Market Reports

Coffee Market Report October 18 2018

The steadily strengthening Brazil Real has continued to inspire sentiment within the New York market, with good volumes of speculative short covering coming to the fore.  This resulting in the market ticking a four-month high in trade yesterday, with the managed money funds and speculative sectors of the market most likely to have significantly reduced their short-sold positions within this volatile market.   

One might comment though that while the firmer Brazil Real might result in internal market price resistance within Brazil, the rising value of the reference prices of the New York market is assisting to allow for exporters to pay up and offer similar prices that were previously considered acceptable to the arabica coffee farmers.  Thus, suggesting that the firmer Real might not slow the volumes of Brazil sales and exports. 

Meanwhile soon to be hanging over the New York market in the coming months and aside from Brazil, shall be large volumes of new main crop Colombian coffees and along with the new Mexican and Central American coffee crops.   These coffees unless the speculative funds find reason not to remain short within this market, most likely to increase the volumes of price fixation hedge selling and to create something of a price ceiling for the market. 

With a large middle class within China and many of whom are turning towards western culture, there is a steadily growing coffee market within the country.   As there is a steadily increasing coffee farming community, within the South East of the country and with coffee production rising towards 2 million bags per annum.  This is being highlighted by the forthcoming 2018 Asian Coffee Annual Conference that is scheduled to take place over the 11th. and 12th. November, in Mangshi City, Yunnan Province. 

The January 2019 to December 2018 contracts arbitrage between the London and New York markets broadened yesterday, to register this at 41.99 usc/Lb., while this equates to 34.26% price discount for the London Robusta coffee market.   

The Certified washed Arabica coffee stocks held against the New York exchange were seen to increase by 2,280 bags yesterday; to register these stocks at 2,425,284 bags.  There were meanwhile a larger in number 4,221 bags decrease in the number of bags pending grading for this exchange; to register these pending grading stocks at 52,629 bags. 

The commodity markets experienced a mixed day yesterday, but with many markets softening, to see the overall macro commodity index tending softer for the day.   The Natural Gas, Sugar, Cocoa, Coffee and Soybean markets ended the day on a positive note, while the Oil, Cotton Copper, Wheat, Corn, Gold and Silver markets ended the day on a softer note.  The Reuters Equal Weight Continuous Commodity Index that is made up from 17 markets is 0.03% lower; to see this index registered at 420.76.   The day starts with the U.S. Dollar showing a degree of buoyancy and trading at 1.309 to Sterling, at 1.149 to the Euro and with the dollar buying 3.687 Brazilian Real, while North Sea Oil is tending softer and is selling at US$ 80.00 per barrel. 

The London and New York markets both started the day yesterday on a negative note, but this was short lived for the New York market that soon started to attract support and to move up into modest positive territory and to see the markets taking a mixed stance, into the early afternoon trade.   As the afternoon progressed the New York market started to attract more support and with high volumes of buy stops being triggered to add unexpected significant value to the market, which was followed by a recovery into positive territory for the London market.    Both markets managing to retain most of the gains of the day by the close, with gains within the New York market being particularly impressive. 

The London market ended the day on a positive note and with 80.8% of the earlier gains of the day intact, while the New York market ended the day on a very positive note and with 93.3% of the earlier gains of the day intact.   This positive close that comes despite negative fundamentals and a robust U.S. Dollar, assists to paint a positive picture for the charts and is constructive for the market.  But with many confused by the somewhat unexpected rally within the markets, one might expect to see the markets set for a cautious and hesitant start for early trade today, against the prices set yesterday, as follows: 

LONDON ROBUSTA US$/MT                       NEW YORK ARABICA USc/Lb. 

NOV   1755 + 11                                             DEC    122.55 + 4.90

JAN    1776 + 21                                             MAR   126.25 + 4.95

MAR   1789 + 20                                             MAY   128.70 + 5.00

MAY   1804 + 21                                              JUL    131.30 + 4.95

JUL    1818 + 21                                              SEP    133.30 + 4.95

SEP    1833 + 20                                              DEC   136.60 + 4.95

NOV   1846 + 21                                              MAR   139.85 + 4.95

JAN    1858 + 21                                              MAY   141.80 + 4.90

MAR   1872 + 21                                              JUL    143.45 + 4.85

MAY   1884 + 21                                              SEP    145.05 + 4.80


Coffee Market Report October 17 2018

The mostly short covering rally within the New York market and with the perspective on the part of many that the with the prevailing negative coffee fundamentals that the market was oversold, stalled in trade yesterday.  One would think though that with the dismal prices of late that the market has been dictating for the arabica coffee farmers, that producer price fixation selling also played a part in the pressure upon the market. 

Good weather conditions for most of the main coffee districts in Brazil and the early perspective that this shall contribute towards a reasonable 2019 crop for Brazil, is also contributing towards negative sentiment.  Which has already been fuelled by the bumper new crop in Brazil this year, which with good Mexican, Central American and Vietnam crops on the horizon, is bringing to the fore estimates for an over 8 million bags surplus coffee supply for this new October 2018 to September 2019 coffee year. 

The January 2019 to December 2018 contracts arbitrage between the London and New York markets narrowed yesterday, to register this at 38.04 usc/Lb., while this equates to 32.33% price discount for the London Robusta coffee market.   

The Certified washed Arabica coffee stocks held against the New York exchange were seen to decrease by 720 bags yesterday; to register these stocks at 2,423,004 bags.  There were meanwhile a larger in number 3,335 bags decrease in the number of bags pending grading for this exchange; to register these pending grading stocks at 56,850 bags. 

The Certified Robusta coffee stocks held against the London exchange were seen to increase by 17,333 bags or 1.2% over the week of trade leading up to Monday 15th., to see these stocks registered at 1,467,333 bags. 

The commodity markets experienced a mixed day yesterday, but with many markets softening, to see the overall macro commodity index taking a softer track for the day.   The Oil, Natural Gas, Cocoa, London robusta Coffee and Orange Juice markets ended the day on a positive note, while the Sugar, New York arabica Coffee, Cotton, Copper, Wheat, Corn, Soybean, Gold and Silver markets ended the day on a softer note.  The Reuters Equal Weight Continuous Commodity Index that is made up from 17 markets is 0.1% lower; to see this index registered at 420.87.   The day starts with the U.S. Dollar steady and trading at 1.318 to Sterling, at 1.156 to the Euro and with the dollar buying 3.725 Brazilian Real, while North Sea Oil is steady and is selling at US$ 81.40 per barrel. 

The London and New York markets started the day yesterday on a positive note and the New York market started the day around par, but with the both markets slipping back into negative territory, for the early afternoon trade.  As the afternoon progressed both markets moved back to trade around par and while the London market then moved back up into positive territory, the New York market started to come under selling pressure and moved back into negative territory.   

The London market ended the day on a modestly positive note and with 30% of the earlier gains of the day intact, while the New York market ended the day on a negative note and with 66.7% of the earlier losses of the day intact.   This close and the reversal of the fortunes of the New York market is likely to dent confidence and bring to the fore a degree of caution, to perhaps set the market for only a hesitant near to steady start for early trade today.   Against the prices set yesterday, as follows: 

LONDON ROBUSTA US$/MT                       NEW YORK ARABICA USc/Lb. 

NOV   1744 + 6                                               DEC    117.65 – 1.70

JAN    1755 + 3                                               MAR   121.30 – 1.65

MAR   1769 + 2                                               MAY   123.70 – 1.65

MAY   1783 + 3                                                JUL    126.10 – 1.60

JUL    1797 + 6                                                SEP    128.35 – 1.65

SEP    1813 + 10                                              DEC   131.65 – 1.60

NOV   1825 + 10                                              MAR   134.90 – 1.55

JAN    1837 + 10                                              MAY   136.90 – 1.60

MAR   1851 + 10                                              JUL    138.60 – 1.65

MAY   1863 + 10                                              SEP    140.25 – 1.65


Coffee Market Report October 16 2018

The latest Commitment of Traders report from the New York arabica coffee market has seen the shorter term in nature Managed Money fund sector of this market decrease their net short sold position within the market by 16.48% over the week of trade leading up to Tuesday 9th. October; to register a new net short sold position of 77,800 Lots.   Meanwhile the longer term in nature Index Fund sector of this market increased their net long position within the market by 3.4%, to register a net long position of 45,949 Lots on the day. 

Over the same week, the Non-Commercial Speculative sector of this market decreased their net short sold position within this market by 11.23%, to register a net short sold position of 86,266 Lots.  This net short sold position which is the equivalent of 24,456,029 bags has most likely been further reduced, following the period of overall positive trade that has since followed and likewise, that of the managed money fund sector of the market. 

The Green Coffee Association of the U.S.A. have announced that the countries port warehouse stocks decreased by 224,641 bags or 3.37% during the month of September, to register these stocks at 6,438,220 bags at the end of the month.   The overall Green Coffee stocks reported, do not include the in-transit bulk container coffees or the onsite roaster inventories, which with an approximate combined U.S.A. and Canadian weekly consumption that is supported by these stocks of approximately 570,000 bags per week, would conservatively have been at least 1.1 million bags. 

Suggesting that if one is to consider the additional unreported stocks the end month stocks, this would equate to more than thirteen weeks of roasting activity, which most would consider to be a very safe reserve.    Especially so ahead of the pending deliveries from large new Mexican and Central American crop, a new Colombian main crop, a large new Vietnam crop and the ongoing surge of new crop deliveries from Brazil. 

Thus, it is somewhat surprising with no one arguing the fact that there shall be global coffee surplus supply for the coming year, that the market correction has been sustained for some days.  But it is related to speculative short covering and one might think that with the equity markets losing their lustre in the recent days, that it is more a matter of moving money and reducing what was a historic over sold position within the New York market.   Making one think that the markets with pending increased volumes of producer price fixation selling on the horizon, that the markets might already be looking towards a nearby ceiling. 

The January 2019 to December 2018 contracts arbitrage between the London and New York markets broadened yesterday, to register this at 39.88 usc/Lb., while this equates to 33.41% price discount for the London Robusta coffee market.   

The Certified washed Arabica coffee stocks held against the New York exchange were seen to decrease by 525 bags yesterday; to register these stocks at 2,423,724 bags.  There were meanwhile a larger in number 5,435 bags decrease in the number of bags pending grading for this exchange; to register these pending grading stocks at 60,185 bags. 

The commodity markets experienced a slightly softer U.S. dollar and had an overall positive day yesterday, to see the overall macro commodity index on an upside track for the day.  The Oil, Natural Gas, Sugar, Coffee, Cotton, Orange Juice, Wheat, Corn, Soybean, Gold and Silver markets ended the day on a positive note, while the Cocoa and Copper markets ended the day on a softer note.  The Reuters Equal Weight Continuous Commodity Index that is made up from 17 markets is 0.9% higher; to see this index registered at 421.28.   The day starts with the U.S. Dollar steady and trading at 1.315 to Sterling, at 1.158 to the Euro and with the dollar buying 3.735 Brazilian Real, while North Sea Oil is steady and is selling at US$ 81.15 per barrel. 

The London and New York markets started the day yesterday on a positive note and with both markets maintaining a positive track, into the early afternoon trade.  As the afternoon progressed the New York market and with some support coming from the positive nature of the overall macro commodity index, started to attract higher volumes of short covering buying, with buy stops being triggered, to accentuate the gains.  This was followed by increased support and added value for the London market, to see both markets moving on towards a relatively strong end to the day. 

The London market ended the day on a positive note and with 87% of the earlier gains of the day intact, while the New York market started the day on a likewise positive note and with 88.9% of the earlier gains of the day intact.   This close further assists to paint a positive picture for the charts, but is not accompanied by any supportive fundamental news.  Thus, aside from a firmer Brazil Real that is anyhow now countered by higher terminal market prices to provide emotive support, it is difficult to have too much confidence in a steady upside track, which might start to bring to the fore some degree of caution and perhaps only a steady start due for early trade today, against the prices set yesterday, as follows: 

LONDON ROBUSTA US$/MT                       NEW YORK ARABICA USc/Lb. 

NOV   1738 + 25                                             DEC    119.35 + 2.80

JAN    1752 + 27                                             MAR   122.95 + 2.85

MAR   1767 + 26                                             MAY   125.35 + 2.85

MAY   1780 + 26                                              JUL    127.70 + 2.85

JUL    1791 + 25                                              SEP    130.00 + 2.80

SEP    1803 + 24                                              DEC   133.25 + 2.75

NOV   1815 + 23                                              MAR   136.45 + 2.70

JAN    1827 + 21                                              MAY   138.50 + 2.70

MAR   1841 + 19                                              JUL    140.25 + 2.65

MAY   1853 + 19                                              SEP    141.90 + 2.55


Coffee Market Report October 15 2018

The latest Commitment of Traders report from the New York arabica coffee market has seen the Non-Commercial Speculative sector of this market decrease their net short sold position within the market by 11.23% over the week of trade leading up to Tuesday 9th. October; to register a new net short sold position of 86,266 Lots.   This net short-sold position which is the equivalent of 24,456,029 bags has most likely been reduced further, following the sharp positive correction for the market at the end of last week. 

The latest Commitment of Traders report from the London robusta coffee market has seen the Speculative Managed Money sector of this market decrease their net short sold position within this market by 39.55% during the week of trade leading up to Tuesday 9th. October; to register a net short sold position of 19,007 Lots on the day.  This net short sold position which is the equivalent of 3,167,833 bags has most likely been reduced further, following the period of more positive trade, which has since followed. 

The World Coffee Producers Forum that includes over thirty coffee producing countries, is reported to have sent a letter to a number of leading consumer market industries, to voice their concern over the soft nature of the international coffee prices.   The World Coffee Producers Form note that in excess of twenty-five million families globally are suffering from the negative effects of the soft coffee prices, but one would comment that there really noting that the industries can do to control the activities of the speculative funds, who are the main cause for the softer coffee market prices. 

The January 2019 to December 2018 contracts arbitrage between the London and New York markets broadened on Friday, to register this at 38.31 usc/Lb., while this equates to 32.87% price discount for the London Robusta coffee market.   

The Certified washed Arabica coffee stocks held against the New York exchange were seen to increase by 3,645 bags on Friday; to register these stocks at 2,424,249 bags.  There were meanwhile a larger in number 8,047 bags increase in the number of bags pending grading for this exchange; to register these pending grading stocks at 65,624 bags. 

The commodity markets experienced an overall positive day on Friday, to see the overall macro commodity index on an upside track for the day.  The Oil, Sugar, Cocoa, Coffee, Cotton and Copper markets ended the day on a positive note, while the Gold market ended the day on a softer note.  The Reuters Equal Weight Continuous Commodity Index that is made up from 17 markets is 0.61% higher; to see this index registered at 417.54.   The day starts with the U.S. Dollar steady and trading at 1.313 to Sterling, at 1.155 to the Euro and with the dollar buying 3.782 Brazilian Real, while North Sea Oil is steady and is selling at US$ 81.00 per barrel. 

The London and New York markets started the day on Friday on a positive note and with both markets maintaining a positive track, into the early afternoon trade.  As the afternoon progressed the New York market started to attract short covering buying from the speculative fund sector of the market, with buy stops being triggered, to accentuate the losses.  With the lack of Brazil selling pressure that came with Friday’s Nossa Senhora de Aparecida public holiday, most likely assisting to allow the New York market to maintain its buoyancy and followed in a less dramatic manner by the London market.   To set both markets for firm end to the weeks trade. 

The London market ended the day on a positive note and with 81.2% of the earlier gains of the day intact, while the New York market started the day on a very positive note and with 93.6% of the earlier gains of the day intact.   This close does much to point a more positive picture for the charts but the reality is that the oversupply scenario still exists and that Brazil shall return to the field of play today, which with the evidence of a relatively sharp drop in the short-sold positions within both markets, might also bring to the fore a degree of caution and attract some producer price fixation selling activity.   Factors that might hinder the chances of follow through buoyancy during early trade today, against the prices set on Friday, as follows: 

LONDON ROBUSTA US$/MT                       NEW YORK ARABICA USc/Lb. 

NOV   1713 + 22                                             DEC    116.55 + 3.65

JAN    1725 + 26                                             MAR   120.10 + 3.60

MAR   1741 + 27                                             MAY   122.50 + 3.55

MAY   1754 + 27                                              JUL    124.85 + 3.60

JUL    1766 + 27                                              SEP    127.20 + 3.60

SEP    1779 + 28                                              DEC   130.50 + 3.60

NOV   1792 + 28                                              MAR   133.75 + 3.60

JAN    1806 + 28                                              MAY   135.80 + 3.60

MAR   1822 + 28                                              JUL    137.60 + 3.65

MAY   1834 + 28                                              SEP    139.35 + 3.65


Coffee Market Report October 12 2018

The weather reports from Brazil confirm normal rainfall for the main coffee districts so far this month, which is supportive for a fair to good crop for next year.  With further rains due for the weekend, to further support the prevailing lack of concern over the prospects for some problems for the longer term coffee supply from Brazil. 

The Climate Prediction Centre of the U.S.A. National Weather Service have upped their forecast for a new El Niño phenomenon to develop within the Pacific Ocean by the end of year, to now foresee a 70% to 75% chance of this to occur.   There is though no indication as to how severe this might be, as a mild El Niño would not be damaging to the potential crops from the Pacific rim coffee producing countries and likewise, to coffee producers further afield. 

The respected Brazilian analyst Safras & Mercado have estimated that so far approximately 51% of the bumper new crop coffees had been sold by the farmers, with what the estimate to be 48% of the new arabica crop coffee sold and 62% of the new conilon robusta coffee crop coffees sold.   But indications are that with good volumes of sales in hand and with the firmer Brazil Real influencing internal market prices, that there is a degree of internal market price resistance developing and internal market trade is slowing. 

The Brazil market is off the field of play for today, with the country celebrating the Nossa Senhora de Aparecida public holiday, which shall along with the distraction of the Swiss Coffee Trade Association meetings and Dinner, shall dull physical coffee trade for the day. 

Vietnam have been experiencing frequent rains over the past few weeks, but are anticipating the dry winter season to soon kick in and to trigger the start of the new coffee harvest.   This harvest expected to bring to the fore another large new crop, while in the meantime and with the improved reference prices of the international coffee terminal markets, internal market sales of the modest past crop stocks still in hand have picked up in volume. 

The January 2019 to December 2018 contracts arbitrage between the London and New York markets broadened yesterday, to register this at 35.83 usc/Lb., while this equates to 31.74% price discount for the London Robusta coffee market. 

The Certified washed Arabica coffee stocks held against the New York exchange were seen to increase by 6,483 bags yesterday; to register these stocks at 2,420,604 bags.  There were meanwhile a smaller in number 3,511 bags decrease in the number of bags pending grading for this exchange; to register these pending grading stocks at 57,577 bags. 

The commodity markets along with the equity markets, were once again under pressure yesterday, to see the overall macro commodity index having an erratic day.   Sugar, Cocoa, New York arabica Coffee, Cotton, Copper and Gold markets nevertheless ended the day on a positive note and the London robusta Coffee market on a steady note, while the Oil market lead the way for many other markets to end the day on a negative note.  The Reuters Equal Weight Continuous Commodity Index that is made up from 17 markets is 0.12% higher; to see this index registered at 415.01.   The day starts with the U.S. Dollar steady and trading at 1.323 to Sterling, at 1.159 to the Euro and with the dollar buying 3.782 Brazilian Real, while North Sea Oil is showing some degree of buoyancy and is selling at US$ 81.35 per barrel. 

The London and New York markets started the day yesterday on a softer note and with both markets coming under early pressure and with sell stops being triggered, to accentuate the losses, but with both markets soon managing to bounce back from the lows and to enter the early afternoon trade on a more modest negative note.  However as the afternoon progressed the New York market started to attract support and to move up into positive territory which was followed late in the day by a recovery for the London market, to see the New York market end off with some degree of muscle and the London market on something of a sideways track. 

The London market ended the day on a steady note and having recovered the earlier $ 27.00 losses of the day and with 25% of the modest gains of the day intact, while the New York market ended the day on a positive note and with 62.5% of the earlier gains of the day intact.   This close and with Brazil and many of the consumer market industries off the field of play for the day, might well inspire a degree of confidence and set the markets for a steady start for early trade today, against the prices set yesterday, as follows: 

LONDON ROBUSTA US$/MT                       NEW YORK ARABICA USc/Lb. 

NOV   1691 + 9                                               DEC    112.90 + 1.00

JAN    1699 + 1                                               MAR   116.50 + 1.00

MAR   1714 + 1                                               MAY   118.95 + 1.00

MAY   1727 + 1                                                JUL    121.25 + 1.00

JUL    1739 + 1                                                SEP    123.60 + 1.05

SEP    1751 – 1                                                DEC   126.90 + 1.00

NOV   1764 – 2                                                MAR   130.15 + 1.00

JAN    1778 – 2                                                MAY   132.20 + 1.00

MAR   1794 – 2                                                JUL    133.95 + 1.00

MAY   1806 – 2                                                SEP    135.70 + 1.00


Coffee Market Report October 11 2018

The Brazilian Coffee Exporters Association Cecafé have noted that while the country exported 27% more coffee during the month of September when compared to the same month last year, that the 2.73 million bags exported could have been much more, if there had not been the problem of more shipping space availability.   This lack of shipping space presently causing delays in shipments of forward coffee contracts, which Cecafé estimate has reduced the contracted for shipment in September coffee export volumes. 

Meanwhile the Brazilian Agricultural Ministry have forecast that the country that relies on agricultural exports for approximately 50% of its export income, that the agricultural exports for this year shall be worth approximately 100 billion U.S. Dollars.   Noting that that agriculture contributes to approximately 25% of the countries total economy and is presently a strong sector, which shall contribute towards an approximate 1.4% gross national product growth for this year. 

The Indian Coffee Exporters Association have voiced concerns over their ability to maintain market share for Indian coffees for this present October 2018 to September 2019 coffee year, following the devastating rains that hit some of the main coffee growing districts in South West India this year.    Suggesting that the countries exporters might suffer from in excess of a 30% shortage in internal market coffee supply, to fuel their traditional export demand.  But also noting that in terms of the significant global coffee surplus supply that is due for this year, that this is a factor that shall not cause concerns on the part of most of the consumer market industries. 

The physical coffee market is due for something of a long weekend with the annual Swiss Coffee Trade Association taking place over today and tomorrow and with the related Thursday Cocktail Party and the Friday Gala Dinner attracting leading representatives of just about every major consumer market coffee industry player and along with, representatives of every major coffee trade company.   This event that has returned to Geneva this year is now seem to be more of a global coffee event, than a Swiss coffee event. 

The January 2019 to December 2018 contracts arbitrage between the London and New York markets narrowed yesterday, to register this at 34.88 usc/Lb., while this equates to 31.17% price discount for the London Robusta coffee market.   

The Certified washed Arabica coffee stocks held against the New York exchange were seen to increase by 845 bags yesterday; to register these stocks at 2,414,121 bags.  There were meanwhile a larger in number 3,567 bags increase in the number of bags pending grading for this exchange; to register these pending grading stocks at 61,088 bags. 

The commodity markets along with the equity markets, were under pressure yesterday, to see the overall macro commodity index on the back foot for the day.   The Orange Juice and Gold markets nevertheless ended the day on a positive note, while the Oil, Natural Gas, Sugar, Cocoa, Coffee, Cotton, Copper, Wheat, Corn, Soybean and Silver markets ended the day on a softer note.  The Reuters Equal Weight Continuous Commodity Index that is made up from 17 markets is 0.64% lower; to see this index registered at 414.50.   The day starts with the U.S. Dollar steady and trading at 1.321 to Sterling, at 1.155 to the Euro and with the dollar buying 3.755 Brazilian Real, while North Sea Oil is near to steady and is selling at US$ 82.15 per barrel. 

The London and New York markets started the day yesterday with some degree of buoyancy, but with the London market soon coming under pressure and slipping back to trade below par and to see the markets taking a mixed stance, into the early afternoon trade.   As the afternoon progressed and with the negative influences of the soft overall macro commodity index playing its part upon sentiment and along with a weaker Brazil Real coming into play, the New York market came under pressure and slipped back into negative territory.   This triggered sell stops with accelerated the losses for the New York market and followed by similar selling and softness for the London market, but with both markets experiencing a degree of exhaustion and bouncing back from the lows and towards a more modest soft close for the day. 

The London market ended the day on a negative note but having recovered 78.6% of the earlier losses of the day by the close, while the New York market ended the day on a negative note and with 59.5% of the earlier losses of the day intact.   This close and the reversal of the fortunes for the markets and likewise commodity markets in general is likely to inspire some degree of caution and one would think that the coffee markets are due a hesitant and only close to steady start for early trade today, against the prices set yesterday, as follows: 

LONDON ROBUSTA US$/MT                       NEW YORK ARABICA USc/Lb. 

NOV   1682 – 11                                             DEC    111.90 – 1.25

JAN    1698 – 6                                               MAR   115.50 – 1.20

MAR   1713 – 5                                               MAY   117.95 – 1.20

MAY   1726 – 6                                                JUL    120.25 – 1.25

JUL    1738 – 7                                                SEP    122.55 – 1.25

SEP    1752 – 7                                                DEC   125.90 – 1.25

NOV   1766 – 7                                                MAR   129.15 – 1.25

JAN    1780 – 7                                                MAY   131.20 – 1.25

MAR   1796 – 7                                                JUL    132.95 + 1.25

MAY   1808 – 7                                                SEP    134.70 + 1.25


Coffee Market Report October 10 2018

The Vietnam Customs Department have reported that the countries coffee exports for the month of September were lower than originally forecast, to be registered at 2,011,083 bags.   This number they say has contributed to the country’s cumulative coffee exports the first nine months of this year, to be 18.8% higher than the same period in the previous year, at a total of 24,116,667 bags. 

The Vietnam Customs Department have further reported that this has contributed to the country’s coffee exports for the October 2017 to September 2018 coffee year to have been 12.3% higher than the previous coffee year, at a total of 29,916,667 bags. 

Vietnam is now poised for the start of the new crop harvest, which should be well underway within the next few weeks, with mixed forecasts coming to the fore in terms of the size of this new crop but with most still looking towards another large crop.   But with Brazil having harvested a significantly larger new conilon robusta coffee crop this year and potentially due to export between four to five million bags of these coffees, it shall provide for some degree of competition for the Vietnam robusta coffees over the coming months. 

There are concerns though being voiced within the internal market in Brazil over the relatively soft prices that are being dictated by the relatively low value reference prices of the international markets, which with the Brazil Real having firmed against the U.S. dollar are pressuring internal market prices lower.   This has triggered the Brazil Farmers Confederation to approach the Ministry of Agriculture in Brazil to look to direct funding towards assisting farmers to finance the carry of coffee stocks, which shall reduce the pressure to sell of stocks to pay farm debts.   

The Colombian Government and with approximately 540,000 farming families related to coffee are meanwhile already taking active steps to provide finance to assist coffee farmers, but with farm gate prices for many coffee farmers reported to be below cost, it is a complicated issue to find sufficient finance to truly eliminate the negative effects of soft international coffee prices. 

Meanwhile the International Coffee Organisation who had forecast a global coffee deficit supply of 3.56 million bags for the just completed October 2017 to September 2018 coffee year, have revised this and reported that there was in fact a global surplus coffee supply over this period of 2.58 million bags.   This report and ahead of the increased surplus supply that is due for the new October 2018 to September 2019 coffee year that comes with the recently completed bumper Brazil crop, will surely contribute towards the prevailing bearish sentiment within the coffee markets.   Despite the recent short covering positive correction within the markets, which has assisted to buoy prices in the recent days. 

The January 2019 to December 2018 contracts arbitrage between the London and New York markets broadened yesterday, to register this at 35.86 usc/Lb., while this equates to 31.69% price discount for the London Robusta coffee market.   

The Certified washed Arabica coffee stocks held against the New York exchange were seen to increase by 2,870 bags yesterday; to register these stocks at 2,413,276 bags.  There were meanwhile a smaller in number 507 bags decrease in the number of bags pending grading for this exchange; to register these pending grading stocks at 57,521 bags. 

The Certified Robusta coffee stocks held against the London exchange were seen to decrease by 3,500 bags or 0.24% over the week of trade leading up to Monday 8th. October, to see these stocks registered at 1,450,000 bags, on the day. 

The commodity markets were mixed in trade yesterday, but with many markets showing some degree of buoyancy, to see the overall macro commodity index taking an upside track for the day.    The Oil, Natural Gas, Sugar, Cocoa, Coffee, Copper, Wheat, Gold and Silver markets ended the day on a positive note, while the Cotton, Orange Juice, Corn and Soybean markets ended the day on a softer note.  The Reuters Equal Weight Continuous Commodity Index that is made up from 17 markets is 0.22% higher; to see this index registered at 417.15.   The day starts with the U.S. Dollar steady and trading at 1.317 to Sterling, at 1.150 to the Euro and with the dollar buying 3.716 Brazilian Real, while North Sea Oil is showing a degree of early buoyancy and is selling at US$ 85.20 per barrel. 

The London market ended the day on a positive note and with 40% of the earlier gains of the day intact, while the New York market ended the day on a very positive note and with 83.9% of the earlier gains of the day intact.   This close and with the Brazil Real remaining firm, is likely to inspire some degree of confidence and to set the markets for a steady start for early trade today against the prices set yesterday, as follows: 

LONDON ROBUSTA US$/MT                       NEW YORK ARABICA USc/Lb. 

NOV   1693 + 9                                               DEC    113.15 + 1.30

JAN    1704 + 4                                               MAR   116.70 + 1.35

MAR   1718 + 5                                               MAY   119.15 + 1.35

MAY   1732 + 5                                                JUL    121.50 + 1.35

JUL    1745 + 3                                                SEP    123.80 + 1.35

SEP    1759 + 3                                                DEC   127.15 + 1.30

NOV   1773 + 3                                                MAR   130.40 + 1.30

JAN    1787 + 3                                                MAY   132.45 + 1.30

MAR   1803 + 3                                                JUL    134.20 + 1.25

MAY   1815 + 3                                                SEP    135.95 + 1.25


Coffee Market Report October 08 2018

The latest Commitment of Traders report from the New York arabica coffee market has seen the Non-Commercial Speculative sector of this market decrease their net short sold position within the market by 10.92% over the week of trade leading up to Tuesday 2nd October; to register a new net short sold position of 97,175 Lots.   This net short-sold position which is the equivalent of 27,548,681 bags has most likely been reduced further, following the positive correction for the market at the end of last week.

Brazil Real to US Dollar 2008 to 2018:

The January 2019 to December 2018 contracts arbitrage between the London and New York markets narrowed, to register this at 33.56 usc/Lb., while this equates to 30.81% price discount for the London Robusta coffee market.  

The Certified washed Arabica coffee stocks held against the New York exchange were seen to increase by 6,526 bags on Friday, to register these stocks at 2,412,036 bags.  There was an increase of 4,677 bags to the number of bags pending grading for this exchange; to register these pending grading stocks at 61,162 bags.

The commodity markets were mixed in trade on Friday, although many markets reflected a degree of buoyancy, as the US Dollar lost ground while Oil markets posted a steadier day.  It was a positive day for Cocoa, Coffee, Cotton, Wheat, Corn, Soybean, Sugar, Gold, Silver, Platinum and Palladium.  The losers on the day were Copper and Orange Juice.  The Reuters Equal Weight Continuous Commodity Index that is made up from 17 markets is 0.45% higher; to see this index registered at 413.75.  The day starts with the U.S. Dollar trading at 1.31 to Sterling, at 1.151 to the Euro.  The Brazilian Real is trading at 3.8364 to the US Dollar, while North Sea Oil is steady, selling at US$ 83.82 per barrel.

The London and New York started the day on Friday with modest buoyancy, London registered positive trade volumes at the outset with rollover activity out of the prompt month apparent.  New York had a comparatively slower start.  New York held on to positive territory in the morning, with incremental gains assisted by the weaker US Dollar, while London market levels oscillated around par, to slip back into negative territory briefly.  As the day progressed the continuation of a positive track in New York brought about speculative short covering and New York, assisted by the lack of participation from producer sellers against firm Brazil Real which has additionally gained ground against the US Dollar during election month in Brazil, New York touched the highs of the day around midsession. It seemed that the London coffee market was swept along for the ride, as renewed buying activity led to a boost in London and a quick gap higher to a new, higher range, where a degree of consolidation was seen in the last few moments of the day, at the highs of the day, on the close.  It was a hefty volume day for London, and a good volume day in New York, the close set in both markets in positive territory and near to the days high attained in both markets, on Friday, as follows:

London Robusta US$/MT                    New York Arabica Usc/Lb.                              

NOV     1,655    +          39                   DEC     108.95  +         2.00
JAN     1,662    +          47                   MAR    112.40  +          2.00
MAR     1,672    +          47                   MAY     114.85  +        2.05
MAY     1,685    +          47                   JULY    117.20  +         2.00
JULY    1,699    +          47                   SEPT   119.55  +         2.05
SEPT  1,713    +          46                   DEC     122.90  +         2.10 NOV     1,727    +          45                   MAR    126.50  +         2.45
JAN     1,741    +          45                   MAY     128.25  +         2.15
MAR     1,757    +          45                   JULY    130.05  +        2.25
MAY     1,769    +          45                   SEPT   131.80  +         2.35


Coffee Market Report October 06 2018

3rd October, 2018.

The National Coffee Growers Federation in Colombia have reported that the country’s coffee production for the month of September was 178,000 bags or 14.49% lower than the same month last year, at a total of 1,050,000 bags. This has contributed to the countries cumulative production for the present October 2017 to September 2018 coffee year to be 644,000 bags or 4.40% lower than the same period in the previous coffee year, at a total of 13,990,000 bags.

The National Coffee Growers Federation in Colombia have also reported that the country’s coffee exports for the month of September were 32,000 bags or 2.81% lower than the same month last year, at a total of 1,104,000 bags. This has contributed to Colombia’s cumulative coffee exports for the present October 2017 to September 2018 coffee year to be 527,000 bags or 3.90% lower than the same period in the previous coffee year, at a total of 12,956,000 bags.

The January 2019 to December 2018 contracts arbitrage between the London and New York markets narrowed yesterday, to register this at 36.48 usc/Lb., while this equates to 33.58% price discount for the London Robusta coffee market.

The Certified washed Arabica coffee stocks held against the New York exchange were seen to increase by 8,673 bags yesterday; to register these stocks at 2,392,120 bags. There was a decrease by 4,246 bags decrease in the number of bags pending grading for this exchange; to register these pending grading stocks at 59,864 bags.

The commodity markets had a mostly positive day yesterday, the US Dollar registered a positive day while the Euro lost ground on the day. The overall macro commodity index took an upside track for the day. It was a softer day in the Oil, Cotton and Palladium markets, whereas the rest of the board finished the day on a firmer note to include Coffee, Cocoa, Corn, Copper, Orange Juice, Soybean, Wheat, Gold, Silver and Platinum markets. The Reuters Equal Weight Continuous Commodity Index that is made up from 17 markets is 1.37% higher; to see this index registered at 415.07. The day starts with the U.S. Dollar steady at 1.299 to Sterling, at 1.157 to the Euro and with the dollar buying 3.94 Brazilian Real, while North Sea Oil is steady in early trade, selling at US$ 85.21 per barrel.

The London and New York coffee markets started the day with London mildly positive and New York slightly softer territory. The early session saw London break through par into negative territory, whereas both markets managed to move back into positive territory ahead of the Americas opening for business. The latter afternoon session registered incremental increases in both markets as the Brazil Real firmed against the US Dollar contributing to the lack of seller participation on the day. Both markets maintained an upward trajectory as the day drew to a close, with the additional support of the generally bullish sentiment across the commodities board yesterday. The markets closed on a positive note and on the highs realised on the day, to set the close after a buoyant and a hefty volume session, as follows:

London Robusta US$/MT New York Arabica Usc/Lb.

NOV  1,604 + 32              DEC 107.65 + 5.45
JAN   1,591 + 39              MAR 111.00 + 5.40
MAR  1,602 + 40              MAY 113.40 + 5.45
MAY   1,614 + 39             JULY 115.75 + 5.40
JULY  1,629 + 40             SEPT 118.05 + 5.35
SEPT 1,644 + 40              DEC 121.40 + 5.30
NOV  1,657 + 39              MAR 124.65 + 5.20
JAN   1,672 + 39              MAY 126.65 + 5.15
MAR  1,689 + 39             JULY 128.35 + 5.10
MAY   1,701 + 41             SEPT 130.00 + 5.05

Coffee Market Report October 02 2018

The latest Commitment of Traders report from the New York arabica coffee market has seen the shorter term in nature Managed Money fund sector of this market decrease their net short sold position within the market by 3.34% over the week of trade leading up to Tuesday 25th. September; to register a new net short sold position of 105,512 Lots.   Meanwhile the longer term in nature Index Fund sector of this market decreased their net long position within the market by 2.78%, to register a net long position of 44,038 Lots on the day. 

Over the same week, the Non-Commercial Speculative sector of this market decreased their net short sold position within this market by 3.8%, to register a net short sold position of 109,097 Lots.  This net short sold position which is the equivalent of 30,928,516 bags has most likely been further reduced, following the period of mixed but overall positive trade that has since followed and likewise, that of the managed money fund sector of the market. 

The International Coffee Organisation ICO have reported that the global coffee exports for the month of August were 6.3% higher than the same month last year, to total approximately 11.1 million bags.   These exports having contributed to the cumulative global coffee exports for the first eleven months of the present October 2017 to September 2018 coffee year to being 1.6% higher than the same period in the previous coffee year, at a total of 112.52 million bags. 

The European Coffee Federation ECF have reported that the port warehouse stocks held within reporting warehouses in the ports in Belgium, Germany, France and Italy increased by 268,517 bags or 2.34% during the month of August, to register these stocks at the end of the month at 11,758,050 bags.   These stocks do not however include the unreported stocks from the industry on site inventory stocks, the transit bulk container stocks and stocks being held within non-reporting warehouses throughout Western and Eastern Europe. 

The combination of West and East Europe consuming approximately 1.05 million bags of coffee a week, one might guess that the additional stocks that were not included in the report, could contribute as much as 2.5 million bags to the reported stocks.  Thus, indicating that as at the end of August, the European coffee stocks might have been close to the equivalent of in excess of a relatively safe, thirteen and half weeks of Western and Eastern European roasting demand.   

The Indonesian government trade data from Sumatra which is the leading coffee producing island within Indonesia, has reported that the islands robusta coffee exports for the month of September were 174,192 bags or 50.96% lower than the same month last year, at a total of 167,641 bags.   This number and following a similarly modest export performance for the previous months has contributed to the cumulative coffee exports for the October 2017 to September 2018 coffee year to be 3,007,755 bags or 65.24% lower than the same period in the previous coffee year, at a total of 1,602,292 bags. 

The Trade Ministry in Brazil have announced their preliminary coffee export figure for the month of September, to register the countries coffee exports for the month to be 815,124 bags or 37.44% higher than the same month last year, at a total of 2,992,294 bags.  These export volumes no doubt being inflated this year, following the inclusion of the surplus conilon robusta coffee crop within the export numbers. 

The National Coffee Institute in Costa Rica has reported that the countries coffee exports for the just completed October 2017 to September 2018 coffee year were 9.7% higher than the previous coffee year, at a total of approximately 1.22 million bags.    While the National Coffee Institute in Honduras have reported that the countries coffee exports for the just completed coffee year were a modest 1% lower than the previous coffee year, at a total of approximately 7.21 million bags. 

Meanwhile the Honduras National Coffee Institute have forecast that with new coffee trees coming into maturity, they forecast that coffee exports for this new October 2018 to September 2019 coffee year might well exceed 8 million bags.   This forecast and along with the prevailing global surplus coffee supply, contributing towards the prevailing bearish sentiment within the coffee markets. 

The January 2019 to December 2018 contracts arbitrage between the London and New York markets narrowed yesterday, to register this at 31.80 usc/Lb., while this equates to 31.12% price discount for the London Robusta coffee market.   

The Certified washed Arabica coffee stocks held against the New York exchange were seen to increase by 5,578 bags yesterday; to register these stocks at 2,383,447 bags.  There were meanwhile a larger in number 13,667 bags decrease in the number of bags pending grading for this exchange; to register these pending grading stocks at 64,110 bags. 

The commodity markets were mixed in trade yesterday, ut with many markets showing some degree of buoyancy, to see the overall macro commodity index taking an upside track for the day.    The Oil, Natural Gas, Sugar, London robusta Coffee, Wheat, Corn and Soybean markets ended the day on a positive note, while the Cocoa, New York arabica Coffee, cotton, Copper, Orange Juice, Gold and Silver markets ended the day on a softer note.  The Reuters Equal Weight Continuous Commodity Index that is made up from 17 markets is 1.22% higher; to see this index registered at 409.46.   The day starts with the U.S. Dollar showing some degree of buoyancy and trading at 1.300 to Sterling, at 1.154 to the Euro and with the dollar buying 4.018 Brazilian Real, while North Sea Oil is showing a degree of early buoyancy and is selling at US$ 85.55 per barrel. 

The London and New York market started the day yesterday trading close to par and with both markets proceeding to trade close to par, into the early afternoon trade.   As the afternoon progressed the London market picked up some modest support and moved into positive territory, while the New York market slipped back into modest negative territory. 

The London market ended the day on a positive note and with 85.7% of the earlier gains of the day intact, while the New York market ended the day on a negative note but having recovered 76.2% of the earlier losses of the day.   This close provides mixed signals and is likely to inspire little better than a near to steady start for early trade today, against the prices set yesterday, as follows: 

LONDON ROBUSTA US$/MT                       NEW YORK ARABICA USc/Lb. 

NOV   1572 + 18                                             DEC    102.20 – 0.25

JAN    1552 + 11                                             MAR   105.60 – 0.25

MAR   1562 + 7                                               MAY   107.95 – 0.30

MAY   1575 + 5                                                JUL    110.35 – 0.25

JUL    1589 + 4                                                SEP    112.70 – 0.20

SEP    1604 + 4                                                DEC   116.10 – 0.25

NOV   1618 + 4                                                MAR   119.45 – 0.20

JAN    1633 + 4                                                MAY   121.50 – 0.20

MAR   1650 + 4                                                JUL    123.25 – 0.20

MAY   1660 + 4                                                SEP    124.95 – 0.20


Coffee Market Report October 01 2018

The latest Commitment of Traders report from the New York arabica coffee market has seen the Non-Commercial Speculative sector of this market decrease their net short sold position within the market by 3.8% over the week of trade leading up to Tuesday 25th. September; to register a new net short sold position of 109,097 Lots.   This net short-sold position which is the equivalent of 30,928,516 bags has most likely been reduced further, following the sharp positive correction for the market at the end of last week. 

The latest Commitment of Traders report from the London robusta coffee market has seen the Speculative Managed Money sector of this market decrease their net short sold position within this market by 1.26% during the week of trade leading up to Tuesday 25th. September; to register a net short sold position of 35,017 Lots on the day.  This net short sold position which is the equivalent of 5,836.167 bags has most likely been reduced further, following the period of more positive trade, which has since followed. 

With the new crop cherries presently ripening in El Salvador, the Ministry of Agriculture have forecast that the countries new crop shall be the countries largest crop since the devastating Roya or Leaf Rust affected 2013/2014 crop, with an estimate that the new crop shall be 72,749 bags or 10.48% larger than the previous crop.   With this somewhat official new crop forecast, indicating a crop of 766,666 bags and somewhat larger than many private trade and industry forecasts. 

The January 2019 to December 2018 contracts arbitrage between the London and New York markets broadened on Friday, to register this at 32.55 usc/Lb., while this equates to 31.77% price discount for the London Robusta coffee market.  

The Certified washed Arabica coffee stocks held against the New York exchange were seen to increase by 4,918 bags on Friday; to register these stocks at 2,377,869 bags.  There were meanwhile a larger in number 9,575 bags decrease in the number of bags pending grading for this exchange; to register these pending grading stocks at 77,777 bags. 

The commodity markets were mixed in trade on Friday but with many markets showing some degree of buoyancy, to see the overall macro commodity index taking an upside track for the day.    The Oil, Sugar, Coffee, Copper, Orange Juice, Gold and Silver markets ended the day on a positive note, while the Natural Gas, Cocoa, Cotton, Wheat and Soybean markets ended the day on a softer note.  The Reuters Equal Weight Continuous Commodity Index that is made up from 17 markets is 0.53% higher; to see this index registered at 404.50.  The day starts with the U.S. Dollar showing some degree of buoyancy and trading at 1.302 to Sterling, at 1.159 to the Euro and with the dollar buying 4.048 Brazilian Real, while North Sea Oil is showing a degree of early buoyancy and is selling at US$ 83.70 per barrel. 

The London and New York market started the day on Friday with modest buoyancy but with both markets moving back to trade around par, for the early afternoon trade.   As the afternoon progressed and with the New York market leading the way, both markets started to attract support and to move back up into positive territory which brought with it the triggering of short covering buy stops for the New York market.   This came with a relatively high volume of trade for the prompt month in the New York market and assisted to accelerate the gains, with the London market following suit and setting both markets for a strong close for the week. 

The London market ended the day on a positive note and with 80.6% of the earlier gains of the day intact, while the New York market ended the day on a very positive note and with 75.9% of the earlier gains of the day intact.   This sharply positive corrective close does assist to inspire a degree of confidence and one might think that the markets could be due for a follow through steady start, against the prices set on Friday, as follows: 

LONDON ROBUSTA US$/MT                       NEW YORK ARABICA USc/Lb. 

NOV   1554 + 38                                             DEC    102.45 + 3.15

JAN    1541 + 29                                             MAR   105.85 + 3.20

MAR   1555 + 26                                             MAY   108.25 + 3.25

MAY   1570 + 26                                              JUL    110.60 + 3.20

JUL    1585 + 27                                              SEP    112.90 + 3.20

SEP    1600 + 26                                              DEC   116.35 + 3.25

NOV   1614 + 24                                              MAR   119.65 + 3.20

JAN    1629 + 24                                              MAY   121.70 + 3.15

MAR   1646 + 24                                              JUL    123.45 + 3.10

MAY   1656 + 32                                              SEP    125.15 + 3.05


Coffee Market Report September 28 2018

Reports indicate that the recent rains over the major coffee district of the south of Minas Gerais in Brazil resulted in good flowerings for the majority of the farms and with more rains forecast for the coming days, the potential for these flowers to set.   This albeit still early days, bringing to the fore the perspective for follow on good crop for the coming year.    But following this year’s bumper harvest, many would speculate that biennial bearing factors would dictate that the next 2019 crop should be somewhat lower than this year’s crop. 

Meanwhile the Brazil Council of Coffee Exporters Cecafé have reported that Brazil’s cumulative coffee exports for the first eight months of this year were 4.5% higher than the same period in the previous year, at approximately 20.5 million bags.  While one would speculate that following the completion of the harvest of the large new crop and including a significantly higher volume of conilon robusta coffees that were not available in quantity for the second half of last year, that the exports for this year shall eventually prove to be significantly higher than the previous year.

 

With the month of September ending, the General Statistics Department of the Vietnam government have estimated that the coffee exports for the month shall be reasonable in volume, to total approximately 2.17 million bags.   This they say shall contribute to the country’s cumulative coffee exports for the first nine months of this year to be 19.6% higher than the same period in the previous year, to total approximately 24.3 million bags. 

Ahead of the new crop harvest the Vietnam Coffee and Cocoa Association Vicofa, have forecast that due to heavy rain cherry drop and to many farmers having switched from coffee to alternative tree crops, that the new coffee crop shall be approximately 2.3% lower than the previous crop, to total approximately 28.5 million bags.   This forecast is contrary to many other private trade and industry forecasts that might well exceed 30 million bags, but in terms of global coffee supply following the large new Brazil crop and including much higher volumes of conilon robusta coffees, one might not think that this latest forecast shall have much effect upon the presently bearish market sentiment. 

The Ivory Coast as West Africa’s largest robusta coffee producer have reported that the countries coffee exports for the month of August were 15,067 bags or 24.05% higher than the same month last year, at a total of 77,717 bags.   This has contributed to the country’s cumulative coffee exports for the first eight months of this year to be 232,333 bags or 45.82% higher than the same period in the previous year, at a total of 739,383 bags.   Thus, indicating that the country remains on track for the forecast for exports for this year, of in excess of 1 million bags. 

The January 2019 to December 2018 contracts arbitrage between the London and New York markets narrowed yesterday, to register this at 30.72 usc/Lb., while this equates to 30.94% price discount for the London Robusta coffee market.   

The Certified washed Arabica coffee stocks held against the New York exchange were seen to decrease by 5,143 bags yesterday; to register these stocks at 2,372,951 bags.  There were meanwhile a larger in number 8,826 bags decrease in the number of bags pending grading for this exchange; to register these pending grading stocks at 87352 bags. 

The commodity markets were mixed in trade yesterday, to see the overall macro commodity index taking a generally sideways track for the day.    The Oil, Natural Gas, Coffee, Corn and Soybean markets ended the day on a positive note and the Sugar market ended the day on a steady note, while the Cocoa, Cotton, Copper, Orange Juice, Wheat, Gold and Silver markets ended the day on a softer note. The Reuters Equal Weight Continuous Commodity Index that is made up from 17 markets is 0.34% higher; to see this index registered at 402.38.  The day starts with the U.S. Dollar steady and trading at 1.306 to Sterling, at 1.162 to the Euro and with the dollar buying 4.013 Brazilian Real, while North Sea Oil is steady and is selling at US$ 81.70 per barrel. 

The London and New York market dipped back into negative territory during trade yesterday, but with both markets bouncing off the lows of the day.   This brought with it the triggering of short covering buy stops, which assisted the markets to recover back into positive territory and with the New York market in particular, posting some good gains for the day. 

The London market ended the day on a positive note and with 62.5% of the earlier gains of the day intact, while the New York market ended the day on a positive note and with 86.1% of the earlier gains of the day intact.   This close does assist to inspire a degree of confidence and one might think that the markets could be due for a follow through steady start, against the prices set yesterday, as follows: 

LONDON ROBUSTA US$/MT                       NEW YORK ARABICA USc/Lb. 

NOV   1516 + 5                                               DEC      99.30 + 1.55

JAN    1512 + 4                                               MAR   102.65 + 1.50

MAR   1529 + 5                                               MAY   105.00 + 1.50

MAY   1544 + 5                                                JUL    107.40 + 1.55

JUL    1558 + 5                                                SEP    109.70 + 1.50

SEP    1574 + 4                                                DEC   113.10 + 1.50

NOV   1590 + 5                                                MAR   116.45 + 1.50

JAN    1605 + 6                                                MAY   118.55 + 1.45

MAR   1622 + 7                                                JUL    120.35 + 1.45

MAY   1624 + 7                                                SEP    122.10 + 1.50


Coffee Market Report September 27 2018

27th. September, 2018.

The November 2018 to December 2018 contracts arbitrage between the London and New York markets widened yesterday, to register this at 29.21 usc/Lb., while this equates to 29.88% price discount for the London Robusta coffee market.

The Certified washed Arabica coffee stocks held against the New York exchange were seen to increase by 2,652 bags yesterday; to register these stocks at 2,378,094 bags. There was an increase of 5,877 bags in the number of bags pending grading for this exchange; to register these pending grading stocks at 96,178 bags.

It was a generally lower day for the commodity markets yesterday, the anticipated announcement by the US Federal Bank and confirmation of interest hike following the midweek meetings, contributed to a degree of stability, while US Dollar firmed against a basket of other major currencies. It was a softer day for the Oil markets, Sugar, Cocoa, Corn, Wheat, Cotton, Copper, Gold and Silver and a more positive day for Soybean, Wheat, Coffee, Platinum and Palladium. The Reuters Equal Weight Continuous Commodity Index that is made up from 17 markets is 0.606% lower; to see this index registered at 403.76. The day starts with the U.S. Dollar steady and trading at 1.3153 to Sterling, at 1.174 to the Euro and the US Dollar buying 4.03 Brazilian Real, while North Sea Oil is steady in early trade and selling at US$ 82.44 per barrel.

The coffee markets started the day yesterday on a positive note in London followed by a mildly positive start in New York with the latter market in good starting volumes at the outset and the markets traded around unchanged for the first quarter of the session. The morning progressed to register a degree of downward pressure but with London managing to recover to par and stay within a narrow range to the end of the day, New York posted incremental positive moves as the America’s opened for their business day, to see this market climb progressively to the high of the day in the last quarter of the session. Renewed selling pressure returned to New York toward the close, to register the close in positive territory closer to the middle of the days trading range, after a fair volume day. The London robusta market posted a last minute recovery from below par, to finish the light volume and rangebound day, just above par, to set the close in both markets yesterday in positive territory, as follows:

London Robusta US$/MT New York Arabica Usc/Lb.

NOV  1,511 + 4                 DEC   97.75 + 0.65
JAN   1,508 + 4                MAR 101.15 + 0.70
MAR  1,524 + 5                MAY 103.50 + 0.60
MAY   1,539 + 5               JULY 105.85 + 0.55
JULY  1,553 + 5               SEPT 108.20 + 0.50
SEPT 1,570 + 5               DEC 111.60 + 0.45
NOV   1,585 + 4               MAR 114.95 + 0.45
JAN   1,599 + 5                MAY 117.10 + 0.50
MAR   1,615 + 5               JULY 118.90 + 0.50

Coffee Market Report September 27 2018

26th. September, 2018.

The Uganda Coffee Development Authority UCDA has reported that the countries coffee exports for the month of August were 69,388 bags or 16.59% lower than the same month last year, to reach a total of 348,952 bags. This has contributed to the country’s cumulative coffee exports for the first eleven months of the present October 2017 to September 2018 coffee year at 4,010,922 bags or 5.92% lower than the same period in the previous coffee year. The cumulative total value of exports has in the softer coffee market conditions which prevail, have thus far registered a total cumulative decline in value terms of 14.41% for the first eleven months of this year when compared to the same period in the previous coffee year. The cumulative export performance with still one more month of exports to come, would indicate meanwhile, that Uganda, with an approximate 70 to 30 ratio of robusta to arabica coffees, will see coffee exports reach or perhaps exceed 4.3 million bags during this present coffee year.

The November 2018 to December 2018 contracts arbitrage between the London and New York markets narrowed yesterday, to register this at 28.74 usc/Lb., while this equates to 29.60% price discount for the London Robusta coffee market.

The Certified washed Arabica coffee stocks held against the New York exchange were seen to increase by 5,153 bags yesterday; to register these stocks at 2,375,442 bags. There was a decrease by 12,565 bags in the number of bags pending grading for this exchange; to register these pending grading stocks at 90,301 bags.

It was a mixed day on the commodity markets yesterday, as the US Federal Reserve meetings approach the second day, while the US Dollar softened and Oil prices firmed. It was a softer day for Sugar, Cocoa, Coffee, Wheat and Platinum, a firmer day for Gold, Silver and Palladium, a firm day for the Oil markets and a positive close in Soybean, Corn, Cotton and Orange Juice markets. The Reuters Equal Weight Continuous Commodity Index that is made up from 17 markets is 0.1861 higher; to see this index registered at 406.23. The day starts with the U.S. Dollar steady and trading at 1.3184 to Sterling, at 1.176 to the Euro and the US Dollar buying 4.08 Brazilian Real, while North Sea Oil is steady in early trade and selling at US$ 81.70 per barrel.

The coffee markets started the day yesterday on a softer track London pushing above par and drifting either side of unchanged over the morning session. The New York market following a similar softer trend but steady in the early morning and succumb to further downward pressure by midsession. The latter half of the day saw on a mildly softer note in slow opening volumes and in a narrow range as the morning progressed. The sentiment in London turned positive on the front months with positive ma recovery in both markets, London back into positive territory and New York touching par briefly, before overhead selling activity returned to the floor, to drive the markets lower toward end of the day. The close in London, mildly positive on the front months and in New York on a softer note in negative territory to set the close in both markets near to the middle of the day’s trading range, a lighter day in volume terms in London and a fair volume day in New York, as follows:

London Robusta US$/MT New York Arabica Usc/Lb.

NOV  1,507 - 6                  DEC    97.10 - 1.40
JAN   1,504 - 3                  MAR 100.45 - 1.45
MAR  1,519 - 2                  MAY 102.90 - 1.45
MAY   1,534 Unch             JULY 105.30 - 1.45
JULY  1,548 + 2                SEPT 107.70 - 1.40
SEPT 1,565 + 4                DEC 111.15 - 1.40
NOV   1,581 + 7                MA R 114.50 - 1.40
JAN    1,594 + 6                MAY  116.60 - 1.35
MAR  1,610 + 5                 JULY 118.40 - 1.35

Coffee Market Report September 25 2018

The latest Commitment of Traders report from the New York arabica coffee market has seen the shorter term in nature Managed Money fund sector of this market increase their net short sold position within the market by 6.30% over the week of trade leading up to Tuesday 18th. September; to register a new net short sold position of 109,159 Lots. Meanwhile the longer term in nature Index Fund sector of this market decreased their net long position within the market marginally, to register a net long position of 45,296 Lots on the day.

Over the same week the Non-Commercial Speculative sector of this market increased their net short sold position within the market by 7.12%, to register a net short sold position of 113,412 Lots. This net short-sold position which is the equivalent of 32,151,799 bags has most likely been reduced a bit, following the period of overall positive trade, which has since followed.

The European Coffee Federation ECF have issued a lower correction to the report of port warehouse coffee stocks held within reporting warehouses in the ports in Belgium, Germany, France and Italy to have decreased by 27,750 bags during the month of July, to register these stocks at the end of the month at 11,489,533 bags.

The European Coffee Federation ECF have further reported the port warehouse stocks held within European reporting warehouses to have registered an increase on the month of 2.30%, to register these stocks at the end of August, at 11,758,050 bags. These stocks do not however include the unreported stocks from the industry on site inventory stocks, the transit bulk container stocks and stocks being held within non-reporting warehouses throughout Western and Eastern Europe.

The November 2018 to December 2018 contracts arbitrage between the London and New York markets broadened yesterday, to register this at 29.87 usc/Lb., while this equates to 30.33% price discount for the London Robusta coffee market.

The Certified washed Arabica coffee stocks held against the New York exchange were seen to increase by 6,906 bags on Friday; to register these stocks at 2,370,289 bags. There was a decrease by 9,698 bags in the number of bags pending grading for this exchange; to register these pending grading stocks at 102,866 bags.

The commodity markets were mixed in trade yesterday, the trade tensions between China and USA sparked investor concerns and ahead, the start of the two-day US Federal Reserve meeting, where speculation heightens around the subject of potential for further interest rate hikes to come. It was a positive day for the Oil markets, Cocoa, Wheat, Corn and Silver markets, whereas it was a flatter day for Gold and a softer day for Coffee, Sugar, Copper, Cotton, Orange Juice Soybean, Platinum, and Palladium markets. The Reuters Equal Weight Continuous Commodity Index that is made up from 17 markets is 0.1481 higher; to see this index registered at 405.47. The day starts with the U.S. Dollar steady and trading at 1.3102 to Sterling, at 1.174 to the Euro and the US Dollar buying 4.09 Brazilian Real, while North Sea Oil is firm in early trade and selling at US$ 81.53 per barrel.

The coffee markets started the day yesterday on a mildly softer note in slow opening volumes and in a narrow range as the morning progressed. The sentiment in London turned positive on the front months with positive moves pushing this market higher into the afternoon session, to see this market finish the day close to the high attained. The New York arabica market remained steady at just below par which turned softer as the day progressed. The absence of fresh fundamental news to guide direction saw this market drift lower, to break through chart triggering levels toward the very end of the day and a close in this market, on the low of the days’ trade. The markets finish after what might be considered a light to medium volume day, on a positive note in London and a softer note in New York, to set the close yesterday, as follows:

London Robusta US$/MT New York Arabica Usc/Lb.

SEPT     1,596 Unch
NOV      1,513 + 24          DEC 98.50 - 1.40
JAN       1,507 + 14          MAR 101.90 - 1.40
MAR      1,521 + 10          MAY 104.35 - 1.40
MAY       1,534 + 6           JULY 106.75 - 1.35
JULY      1,546 + 1           SEPT 109.10 - 1.40
SEPT     1,561 - 1            DEC 112.55 - 1.35
NOV      1,574  - 2            MAR 115.90 - 1.35
JAN       1,588  - 2            MAY 117.95 - 1.35
MAR      1,605 - 2            JULY 119.75 - 1.40

Coffee Market Report September 24 2018

The latest Commitment of Traders report from the New York arabica coffee market has seen the Non-Commercial Speculative sector of this market increase their net short sold position within the market by 7.12% over the week of trade leading up to Tuesday 18th. September; to register a new net short sold position of 113,412 Lots. This net short-sold position which is the equivalent of 32,151,799 bags has most likely been reduced a bit, following the period of overall positive trade, which has since followed.

The latest Commitment of Traders report from the London robusta coffee market has seen the Speculative Managed Money sector of this market increase their net short sold position within this market by 0.08% during the week of trade leading up to Tuesday 18th. September; to register a net short sold position of 35,465 Lots on the day. This net short sold position which is the equivalent of 5,910,833 bags has most likely been little changed to marginally increased, following the period of mixed but overall softer trade, which has since followed.

The European Coffee Federation ECF have reported that the port warehouse stocks held within reporting warehouses in the ports in Belgium, Germany, France and Italy increased by 72,250 bags or 0.63% during the month of July, to register these stocks at the end of the month at 11,589,533 bags. These stocks do not however include the unreported stocks from the industry on site inventory stocks, the transit bulk container stocks and stocks being held within non-reporting warehouses throughout Western and Eastern Europe.

The combination of West and East Europe consuming approximately 1.05 million bags of coffee a week, one might guess that the additional stocks that were not included in the report, could contribute as much as 2.5 million bags to the reported stocks. Thus, indicating that as at the end of June, the European coffee stocks might have been close to the equivalent of in excess of a relatively safe, thirteen weeks plus of Western and Eastern European roasting demand. This is a contributing factor which supports the prevailing bearish sentiment on the part of the speculative sector of the coffee markets and likewise, contributes to a degree of complacency on the part of the consumer market industries.

The Ministry of Agriculture and Land Development of Colombia and in cooperation with the National Land Agency of Colombia, have announced a plan to promote access to land for up to twenty thousand rural youth, so as to assist them to become new coffee farmers. This program to forward both finance and technical assistance for these prospective coffee farmers, which would further add to the already relatively impressive Colombian coffee crop in the coming years.

The November 2018 to December 2018 contracts arbitrage between the London and New York markets broadened on Friday, to register this at 32.36 usc/Lb., while this equates to 32.39% price discount for the London Robusta coffee market.

The Certified washed Arabica coffee stocks held against the New York exchange were seen to increase by 11,238 bags on Friday; to register these stocks at 2,363,383 bags. There were meanwhile a smaller in number 7,876 bags increase in the number of bags pending grading for this exchange; to register these pending grading stocks at 112,564 bags.

The commodity markets were mixed in trade on Friday, to see the overall macro commodity index taking a steady to positive track for the day. The Oil, Natural Gas, Sugar, New York arabica Coffee, Cotton, Copper, Corn and Silver markets ended the day on a positive note, while the Cocoa, London robusta Coffee, Orange Juice, Wheat, Soybean and Gold markets ended the day on negative note. The Reuters Equal Weight Continuous Commodity Index that is made up from 17 markets is 0.17% higher; to see this index registered at 404.88. The day starts with the U.S. Dollar steady and trading at 1.307 to Sterling, at 1.174 to the Euro and the US Dollar buying 4.05 Brazilian Real, while North Sea Oil is steady and is selling at US$ 79.73 per barrel.

The London market started the day on Friday on a modestly negative note, while the New York market started the day on a steady note and with the London market recovering, to see both markets trading around par for the early afternoon trade. As the afternoon progressed the London market started to come under pressure and dipped back into negative territory, while the New York market attracted support and showed some healthy buoyancy, but to soon hit a ceiling and to fall back into negative territory. The London market continued to take a softer track, while the New York market recovered to move into modest positive territory in late trade.

The London market ended the day on a negative note and with very positive note and with 70.4% of the earlier losses of the day intact, while the New York market ended the day on a positive note and with 15% of the earlier gains of the day intact. This close does little to inspire confidence, but with the evidence of the extensive net short sold status of the New York market their might be a degree of caution, to set the markets for a steady start for early trade today, against the prices set on Friday, as follows:

LONDON ROBUSTA US$/MT NEW YORK ARABICA USc/Lb.

SEP  1596 + 28
NOV  1489 – 19   DEC   99.90 + 0.15
JAN   1493 – 16   MAR 103.30 + 0.20
MAR  1511 – 15   MAY 105.75 + 0.30
MAY   1528 – 14   JUL 108.10 + 0.30
JUL   1545 – 15    SEP 110.50 + 0.35
SEP   1562 – 14   DEC 113.90 + 0.35
NOV   1576 – 14   MAR 117.25 + 0.35
JAN   1590 – 14   MAY 119.30 + 0.35
MAR  1607 – 14   JUL 121.15 + 0.35

Coffee Market Report September 21 2018

The reports from Brazil indicate that many of the main coffee districts in the South East of the country have received reasonable rains over the past week, which is likely to bring some good flowering for the coming week.   This would dictate the need for fair follow on rains for the end of the month and the first half of October to set the flowering and the week by week rainfall reports shall be closely watched, albeit that for the present there are no voices of concern over the possibility of any weather problems for Brazil. 

Meanwhile with large new crop stocks in hand and assistance from a soft currency, the farmers and cooperatives have been steady sellers and exporters are well able to cover their forward sales commitments.   With indications that following a high volume of coffee exports in August, that this month shall prove to be another month of high volume of exports. 

One would think though that following yesterday afternoon’s hardening of the Brazil Real which brought with it slowing Brazil price fixation selling activity and speculative short covering in anticipation of the effects of this, that it shall be a quite end to the week for internal coffee trade in Brazil.   The currency perhaps due for considerable volatility with the forthcoming elections in just over two weeks’ time and to be followed in five weeks’ time, with the run off for the front runners in the Presidential election. 

The November 2018 to December 2018 contracts arbitrage between the London and New York markets broadened yesterday, to register this at 31.35 usc/Lb., while this equates to 31.42% price discount for the London Robusta coffee market.   

The Certified washed Arabica coffee stocks held against the New York exchange were seen to increase by 10,914 bags yesterday; to register these stocks at 2,352,145 bags.  There were meanwhile a larger in number 13.319 bags increase in the number of bags pending grading for this exchange; to register these pending grading stocks at 120,440 bags. 

The commodity markets encountered a softening U.S. dollar yesterday and with many markets adding value later in the day, to see the overall macro commodity index taking a positive track for the day.  The Natural Gas, Cocoa, Coffee, Copper, Orange Juice, Wheat, Corn, Soybean, Gold and Silver markets ended the day on a positive note, while the Oil, Sugar and Cotton markets ended the day on a softer note.  The Reuters Equal Weight Continuous Commodity Index that is made up from 17 markets is 0.73% higher; to see this index registered at 404.17.  The day starts with the U.S. Dollar steady and trading at 1.326 to Sterling, at 1.178 to the Euro and with the dollar buying 4.076 Brazilian Real, while North Sea Oil is steady and is selling at US$ 79.05 per barrel. 

The London market started the day yesterday on a modestly negative note, while the New York market started the day trading around par and with the London market coming back to see both markets entering the early afternoon trade on a steady note.   As the afternoon progressed both markets started to show some modest buoyancy and with the Brazil Real starting to firm further, the New York market lead the way to attract support and finally in later trade to trigger short covering buy stops within both markets.   This accelerated the gains and set both markets for a relatively strong close, but with new selling pressure coming into play and capping the markets for the day. 

The London market ended the day on a very positive note and with 91.3% of the earlier gains of the day intact, while the New York market ended the day on a positive note and with 76.2 of the earlier gains of the day intact.   This close and with the Brazil Real presently holding its firmer rate of yesterday might assist to inspire some degree of confidence and set the markets for a steady start for early trade today, against the prices set yesterday, as follows: 

LONDON ROBUSTA US$/MT                       NEW YORK ARABICA USc/Lb. 

SEP    1568 + 17

NOV   1508 + 21                                             DEC      99.75 + 3.05

JAN    1509 + 17                                             MAR   103.10 + 3.05

MAR   1526 + 16                                             MAY   105.45 + 3.00

MAY   1542 + 15                                              JUL    107.80 + 2.95

JUL    1560 + 15                                              SEP    110.15 + 2.95

SEP    1576 + 15                                              DEC   113.55 + 2.90

NOV   1590 + 15                                              MAR   116.90 + 2.90

JAN    1604 + 15                                              MAY   118.95 + 2.90

MAR   1621 + 14                                              JUL    120.80 + 2.90

 


Coffee Market Report September 20 2018

The coffee markets aside from the building debate between coffee producers as to how to do something about the soft nature of the reference prices of the coffee terminal markets, are devoid of any striking fundamental news.  With the large new Brazil crop this year, the prospects for another large new Vietnam crop soon to start being harvested, steadily rising New York certified stock levels and a weak Brazil Real encouraging new crop sales, continuing to fuel speculative bearish sentiment. 

The problem is that while producers are addressing the global consumer market industries to see what they can do to assist to buoy prices, the very nature of free trade and the stiff competition within the consumer markets, really does not allow for the consumer market industries to assist.  Leaving producers aside from the few that have gained relief from weakening currencies, to have to suffer the pain of selling new crops at close to cost and often, below cost of production. 

There have though been some questions coming to the fore, as to what impact might next months elections in Brazil might have upon the value of the Brazil Real.  With thoughts being voiced that should there be some economic confidence building results coming to the fore, it might assist towards a recovery for the currency.   A factor that would dampen selling spirits on the part of the farmers and coffee cooperatives and in anticipation of this, it would likely encourage some short covering activity to assist to buoy value within the New York market.  

The November 2018 to December 2018 contracts arbitrage between the London and New York markets broadened yesterday, to register this at 29.25 usc/Lb., while this equates to 30.25% price discount for the London Robusta coffee market.   

The Certified washed Arabica coffee stocks held against the New York exchange were seen to increase by 12,827 bags yesterday; to register these stocks at 2,341,231 bags.  There were meanwhile a smaller in number 8,314 bags increase in the number of bags pending grading for this exchange; to register these pending grading stocks at 107,121 bags. 

The Certified Robusta coffee stocks held against the London exchange were seen to increase by 53,500 bags or 4.19% over the week of trade leading up to Monday 17th. September, to see these stocks registered at 1,329,167 bags on the day. 

The commodity markets encountered a steady U.S. dollar yesterday and a mixed days trade, to see the overall macro commodity index taking a steady to positive track for the day.  The Oil, Sugar, New York arabica Coffee, Cotton, Wheat, Corn, Soybean, Gold and Silver markets ended the day on a positive note, while the Natural Gas, Cocoa, London robusta Coffee, Copper and Orange Juice markets ended the day on a softer note.  The Reuters Equal Weight Continuous Commodity Index that is made up from 17 markets is 0.54% higher; to see this index registered at 401.26.  The day starts with the U.S. Dollar steady and trading at 1.315 to Sterling, at 1.168 to the Euro and with the dollar buying 4.130 Brazilian Real, while North Sea Oil is showing a degree of buoyancy and is selling at US$ 80.00 per barrel. 

The London market started the day yesterday on a modestly negative note, while the New York market started the day trading around par but soon losing its way, to join the London market within modestly negative territory into the early afternoon trade.  As the afternoon progressed the London market moved further into negative territory while the New York market attracted some support to recover and move up into positive territory and to set the markets for a mixed close for the day. 

The London market ended the day on a negative note and with 50% of the earlier losses of the day intact, while the New York market ended the day on a positive note and with 63% of the earlier gains of the day intact.   This mixed close and despite some corrective buoyancy for the New York market does little to inspire confidence, but one might think that there shall be some degree of caution and set the markets for a hesitant steady start, for early trade today.   Against the prices set yesterday, as follows: 

LONDON ROBUSTA US$/MT                       NEW YORK ARABICA USc/Lb. 

SEP    1551 + 18

NOV   1487 – 5                                               DEC      96.70 + 0.85

JAN    1492 – 6                                               MAR   100.05 + 0.85

MAR   1510 – 7                                               MAY   102.45 + 0.80

MAY   1527 – 9                                                JUL    104.85 + 0.85

JUL    1545 – 9                                                SEP    107.20 + 0.85

SEP    1561 – 9                                                DEC   110.65 + 0.85

NOV   1575 – 8                                                MAR   114.00 + 0.85

JAN    1589 – 8                                                MAY   116.05 + 0.85

MAR   1607 – 8                                                JUL    117.90 + 0.85


Coffee Market Report September 19 2018

The traditionally conservative Brazil governments agricultural statistics agency CONAB and the new crop harvest close to completion, have revised 3.2% higher from their May 2018 forecast the new Brazil crop.  This crop they now foresee to be 59.87 million bags and made up from 45.9 million bags of arabica coffees and 13.97 million bags of conilon robusta coffees. 

The same report has estimated that this larger crop that they say is 33.13% larger than the previous 2017 crop, they say has been harvested off 2.3% less land than the previous crop.  The report estimating that this year’s crop has come off approximately 2.15 million hectares, which would extrapolate to an overall yield of 1,671 Kgs., per hectare. 

It must be noted though in terms of the official CONAB overall crop report, that their assessment of the previous 2017 crop proved to be between 10% and 14% lower than many other private trade and industry post-harvest and marketing year assessments of the crop, which illustrates the conservative nature of the CONAB report.   A factor that somewhat underpins the many trade and industry new crop forecasts and reports that exceed the 62 million bags mark and with some, significantly higher in number and the report could be seen to be rather bearish for market sentiment. 

West Africa’s leading robusta coffee exporter the Ivory Coast have reported that the countries coffee exports for the month of July were 3,117 bags or 2.83% higher than the same month last year, at a total of 113,183 bags.   This contributes to the country’s cumulative coffee exports for the first seven months of 2018 to be 209,717 bags or 48.72% higher than the same period in the previous year, at a total of 640,183 bags.   Therefore, the country remains on track for exports for the year, which some industry players have forecast to be in excess of 1 million bags. 

The November 2018 to December 2018 contracts arbitrage between the London and New York markets narrowed yesterday, to register this at 28.17 usc/Lb., while this equates to 29.39% price discount for the London Robusta coffee market.   

The Certified washed Arabica coffee stocks held against the New York exchange were seen to increase by 8,583 bags yesterday; to register these stocks at 2,328,404 bags.  There were meanwhile a larger in number 20,181 bags decrease in the number of bags pending grading for this exchange; to register these pending grading stocks at 98,807 bags. 

The Certified Robusta coffee stocks held against the London exchange were seen to increase by 53,500 bags or 4.19% over the week of trade leading up to Monday 17th. September, to see these stocks registered at 1,329,167 bags on the day. 

The commodity markets encountered a steady U.S. dollar yesterday and a mixed days trade, to see the overall macro commodity index taking a steady to positive track for the day.  The Oil, Natural Gas, Cocoa, London robusta Coffee, Copper and Wheat markets ended the day on a positive note, while the Sugar, New York arabica Coffee, Cotton, Orange Juice, Corn, Soybean, Gold and Silver markets ended the day on a softer note.  The Reuters Equal Weight Continuous Commodity Index that is made up from 17 markets is 0.18% higher; to see this index registered at 399.11.  The day starts with the U.S. Dollar near to steady and trading at 1.315 to Sterling, at 1.168 to the Euro and with the dollar buying 4.159 Brazilian Real, while North Sea Oil is showing a degree of buoyancy and is selling at US$ 79.45 per barrel. 

The London market started the day yesterday on a modest negative note, while the New York market started the day trading around par and with the London market recovering to trade around par and the New York market moving north into positive territory, for early afternoon trade.   As the afternoon progressed and with the London market trading quietly on a sideways track around par, the New York market started to attract renewed speculative selling pressure and triggering sell stops, to hit lows last seen in December 2005, before bouncing back from the lows.   While the London market attracted support, to move up into positive territory within late trade. 

The London market ended the day on a positive note and with 86.7% of the earlier gains of the day intact, while the New York market ended the day on a negative note and with 65.9% of the earlier losses of the day intact.   This mixed close does little to inspire confidence, but one might think that the New York market is by now oversold and that once again is due for a steady to corrective start for early trade today, while the London market might start to attract producer selling pressure.   To set the markets for a mixed start for early trade today, against the prices set yesterday, as follows: 

LONDON ROBUSTA US$/MT                       NEW YORK ARABICA USc/Lb. 

SEP    1533 + 12                                             SEP      92.00 – 1.45

NOV   1492 + 13                                             DEC      95.85 – 1.45

JAN    1498 + 12                                             MAR     99.20 – 1.55

MAR   1517 + 11                                             MAY   101.65 – 1.55

MAY   1536 + 11                                              JUL    104.00 – 1.60

JUL    1554 + 11                                              SEP    106.35 – 1.60

SEP    1570 + 11                                              DEC   109.80 – 1.60

NOV   1583 + 10                                              MAR   113.15 – 1.60

JAN    1597 + 10                                              MAY   115.20 – 1.60

MAR   1615 + 10                                              JUL    117.05 – 1.55


Coffee Market Report September 18 2018

The latest Commitment of Traders report from the New York arabica coffee market has seen the shorter term in nature Managed Money fund sector of this market increase their net short sold position within the market by 0.52% over the week of trade leading up to Tuesday 11th. September; to register a new net short sold position of 102,688 Lots.   Meanwhile the longer term in nature Index Fund sector of this market increased their net long position within the market by 4.6%, to register a net long position of 45,660 Lots on the day. 

Over the same week, the Non-Commercial Speculative sector of this market increased their net short sold position within this market by 0.51%, to register a net short sold position of 105,874 Lots.  This net short sold position which is the equivalent of 30,014,810 bags has most likely been further increased, following the period of mixed but overall negative trade that has since followed and likewise, that of the managed money fund sector of the market. 

Meanwhile the new crop cherries in Mexico and Central America are steadily ripening, as is the case for many Colombian farmers, ahead of the new crop for these fine washed arabica coffee producers.   But with the soft nature of the speculatively short sold reference prices within the New York market, these producers are presently looking at something of a coffee crisis and with the potential lack of profitability due to make the full quality of harvest costs difficult to finance.   Even for those countries who have managed to gains some relief, from the softening of their local currency against the U.S. dollar. 

One might not though suggest that the inability to finance usual frequency of ripe cherry picks through the harvest season shall have any impact on the prospects for a follow through good crop from the Mexico, the Central Americans and Colombia, but rather higher than normal percentages of under and over ripe cherries being stripped from the trees.   This to have some negative impact upon the overall quality of the new crop, coming from these fine washed arabica coffee producers. 

The Green Coffee Association of the U.S.A. have announced that the countries port warehouse stocks decreased by 172,768 bags or 2.53% during the month of August, to register these stocks at 6,662,861 bags at the end of the month.   The overall Green Coffee stocks reported, do not include the in-transit bulk container coffees or the onsite roaster inventories, which with an approximate combined U.S.A. and Canadian weekly consumption that is supported by these stocks of approximately 570,000 bags per week, would conservatively have been at least 1.1 million bags.   If one is to consider the additional unreported stocks the end month stocks, this would equate to more than thirteen and half weeks of roasting activity, which most would consider to be a very safe reserve. 

The November 2018 to December 2018 contracts arbitrage between the London and New York markets narrowed yesterday, to register this at 30.21 usc/Lb., while this equates to 31.05% price discount for the London Robusta coffee market.   

The Certified washed Arabica coffee stocks held against the New York exchange were seen to increase by 11,971 bags yesterday; to register these stocks at 2,319,821 bags.  There were meanwhile a larger in number 15,253 bags decrease in the number of bags pending grading for this exchange; to register these pending grading stocks at 118,988 bags. 

The commodity markets encountered a softening of the dollar yesterday, but with most markets nevertheless on the back foot, to see the overall macro commodity index taking a softer track for the day.  The Natural Gas, cocoa, Copper, Gold and Silver markets ended the day on a positive note, while the Oil, Sugar, Coffee, Cotton, Orange Juice, Wheat, Corn and Soybean markets ended the day on a softer note.  The Reuters Equal Weight Continuous Commodity Index that is made up from 17 markets is 0.54% lower; to see this index registered at 398.41.  The day starts with the U.S. Dollar steady and trading at 1.315 to Sterling, at 1.169 to the Euro and with the dollar buying 4.134 Brazilian Real, while North Sea Oil is steady and is selling at US$ 77.60 per barrel. 

The London and New York markets started the day yesterday trading on a softer note and with both markets taking a softer track, into the early afternoon trade.  The London market continued through the afternoon trading mostly south of par, while the New York market with a weak Brazil Real, rain reports out of Brazil came under further pressure and triggered sell stops to extend the gains and set new twelve-year lows. 

The London market ended the day on a negative note and with 71.4% of the earlier losses of the day intact, while the New York market ended the day on a very negative note and with 94.1% of the earlier losses of the day intact.   This close does little to inspire confidence, but one might think that there might be some degree of speculative exhaustion within the New York market, to set the New York market for a modest corrective positive start and the London market for a steady start, for early trade today.  Against the prices set yesterday, as follows: 

LONDON ROBUSTA US$/MT                       NEW YORK ARABICA USc/Lb. 

SEP    1521 – 16                                             SEP      93.45 – 2.00

NOV   1479 – 10                                             DEC      97.30 – 2.40

JAN    1486 – 11                                             MAR   100.75 – 2.40

MAR   1506 – 10                                             MAY   103.20 – 2.35

MAY   1525 – 10                                              JUL    105.60 – 2.35

JUL    1543 – 10                                              SEP    107.95 – 2.40

SEP    1559 – 10                                              DEC   111.40 – 2.35

NOV   1573 – 8                                                MAR   114.75 – 2.35

JAN    1587 – 7                                                MAY   116.80 – 2.35

MAR   1605 – 7                                                JUL    118.60 – 2.30


Coffee Market Report September 17 2018

The latest Commitment of Traders report from the New York arabica coffee market has seen the Non-Commercial Speculative sector of this market increase their net short sold position within the market by 0.51% over the week of trade leading up to Tuesday 11th. September; to register a new net short sold position of 105,874 Lots.   This net short-sold position which is the equivalent of 30,014,810 bags has most likely been little changed, following the period of mixed but overall sideways trade, which has since followed. 

The latest Commitment of Traders report from the London robusta coffee market has seen the Speculative Managed Money sector of this market decrease their net short sold position within this market by 2.48% during the week of trade leading up to Tuesday 11th. September; to register a net short sold position of 35,438 Lots on the day.  This net short sold position which is the equivalent of 5,906,333 bags has most likely been little changed, following the period of mixed but overall sideways trade, which has since followed. 

There are many speculative reports coming to the fore from the Indian coffee states of Kerala and Karnataka, which attempt to calculate the degree of damage that has been done by the recent couple of months of excessive monsoon rains.   These rains having caused landslides and damage from falling trees upon many farms, with reports indicating that the damage to the new crop potential might well exceed 14% and that the forthcoming new coffee crop might be lower than 15 million bags. 

But so far and against the negative impact of the large new Brazil coffee crop this year and ahead of what is forecast to be another bumper new crop from Vietnam, which is due to start being harvested next month, the news from India does little to dent the prevailing bearish sentiment.   It really would need the markets to encounter the fundamental of damaging climatic conditions for one or other of the main coffee producer blocs, for market sentiment to change and thus for the short term, there shall most certainly be a close eye being kept over the rainfall reports out of Brazil. 

However, with the evidence of the extensive short sold status of the speculative sector of the New York market, it is difficult to believe that this can be significantly increased and, in this respect, one might guess that the downside potential of the New York market is somewhat limited.   While the potential for a violent short covering positive reaction within this market that would come with any presently unforeseen negative climatic fundamental news, is a medium-term possibility.   Particularly so, in terms of the erratic and unpredictable global weather conditions. 

The November 2018 to December 2018 contracts arbitrage between the London and New York markets narrowed on Friday, to register this at 32.16 usc/Lb., while this equates to 32.26% price discount for the London Robusta coffee market.   

The Certified washed Arabica coffee stocks held against the New York exchange were seen to increase by 9,144 bags on Friday; to register these stocks at 2,307,850 bags.  There were meanwhile a smaller in number 8,067 bags decrease in the number of bags pending grading for this exchange; to register these pending grading stocks at 134,241 bags. 

The commodity markets encountered some degree of buoyancy developing for the U.S. dollar on Friday, with the majority of the markets tending softer, to see the overall macro commodity index taking a softer track for the day.   The U.S. Oil, Cotton, Wheat and Corn markets nevertheless ended the day on a positive note, while the Brent Oil, Natural Gas, Sugar, Cocoa, Coffee, Copper, Orange Juice, Soybean, Gold and Silver markets ended the day on a softer note.  The Reuters Equal Weight Continuous Commodity Index that is made up from 17 markets is 0.47% lower; to see this index registered at 400.57.  The day starts with the U.S. Dollar steady and trading at 1.309 to Sterling, at 1.163 to the Euro and with the dollar buying 4.174 Brazilian Real, while North Sea Oil is steady and is selling at US$ 77.80 per barrel. 

The London and New York markets started the day on Friday trading south of par but with both markets soon recovering towards par, to move up to trade around par for the early afternoon trade.   As the afternoon progressed the London market continued to trade around par, while the New York market came under pressure and moved down into negative territory and finally in late trade, to be joined by the London market moving down towards a soft close. 

The London market ended the day on a negative note and with 73.3% of the earlier losses of the day intact, while the New York market ended the day on a likewise negative note and with 82.6% of the earlier losses of the day intact.   This close does not assist to paint a pretty picture for the charts and with the soft Brazil Real in play, one might think that the markets are due for little better than a near to steady start for early trade today.   Against the prices set on Friday, as follows: 

LONDON ROBUSTA US$/MT                       NEW YORK ARABICA USc/Lb. 

SEP    1537 – 18                                             SEP      95.45 – 0.95

NOV   1489 – 11                                             DEC      99.70 – 0.95

JAN    1497 – 11                                             MAR   103.15 – 0.90

MAR   1516 – 10                                             MAY   105.55 – 0.90

MAY   1535 – 9                                                JUL    107.95 – 0.90

JUL    1553 – 8                                                SEP    110.35 – 0.85

SEP    1569 – 9                                                DEC   113.75 – 0.90

NOV   1581 – 10                                              MAR   117.10 – 0.85

JAN    1594 – 10                                              MAY   119.15 – 0.85

MAR   1612 – 8                                                JUL    120.90 – 0.90


Coffee Market Report September 14 2018

The Brazil new crop harvest is mostly completed and with scattered rain showers starting to come to many of the main coffee districts, but nothing general and intensive is so far being forecast for the month.   But it is really the month of October that traditionally is the start of the full spring and summer rain season for the Brazil coffee districts and so far, the intermittent rain reports are not a matter of concern.  

Meanwhile the soft nature of the Brazil Real that is trading today at 4.206 to the U.S. dollar has assisted Brazil’s coffee farmers to counter the negative nature of the soft reference prices of the international coffee terminal markets, to see fuel steady internal market selling of new crop coffees.  Albeit that despite the assistance of the soft exchange rate, the internal market coffee prices in Brazil are still not very profitable for many farmers. 

There is though some added assistance, in that aside from the assistance that comes with the exchange rate, the fact that overall coffee farm yields for this year’s new crop were on average 25% higher than the previous crop, it has contributed to lower unit costs of production.   A factor that assists towards profitable coffee sales, for the majority of the Brazilian coffee farmers and will ensure a steady stream of new crop coffees coming to the consumer markets in the coming months. 

The Climate Prediction Centre of the National Weather Service of the U.S.A. in its monthly report, has reported that they foresee a 50% to 55% chance for a new El Niño phenomenon to start to develop in the Pacific Ocean before the end of the year.  Furthermore a 65% to 70% chance for an El Niño to develop early in the coming year, but while this phenomenon can be threatening for coffee production for the Pacific Rim producers and even further afield, this is only if it develops into a severe rather than modes El Niño.  Thus for the present, there is little in the way of market reaction to this possible threat. 

The November 2018 to December 2018 contracts arbitrage between the London and New York markets narrowed yesterday, to register this at 32.61 usc/Lb., while this equates to 32.4% price discount for the London Robusta coffee market.   

The Certified washed Arabica coffee stocks held against the New York exchange were seen to increase by 11,390 bags yesterday; to register these stocks at 2,298,706 bags.  There were meanwhile a smaller in number 10,494 bags decrease in the number of bags pending grading for this exchange; to register these pending grading stocks at 142,308 bags. 

Many of the commodity markets encountered a further softening of the U.S. dollar yesterday, but this did little to assist many of the markets and many markets came under pressure through the day, to see the overall macro commodity index taking a softer track for the day.   The Natural Gas and Copper markets nevertheless ended the day on a positive note, while the Oil, Sugar, Cocoa, Coffee, Cotton, Orange Juice, Wheat, Corn, Soybean, Gold and Silver markets ended the day on a softer note.   The Reuters Equal Weight Continuous Commodity Index that is made up from 17 markets is 0.59% lower; to see this index registered at 402.46.  The day starts with the U.S. Dollar steady and trading at 1.311 to Sterling, at 1.169 to the Euro and with the dollar buying 4.206 Brazilian Real, while North Sea Oil is steady and is selling at US$ 77.90 per barrel. 

The London and New York markets started the day yesterday trading around par, but with the London market soon coming under pressure and moving south into negative territory, while the New York market remained relatively steady and trading around par, into the early afternoon trade.   As the afternoon progressed the New York market and in line with the softening nature of the overall macro commodity index came under pressure and moved back to join the London market within negative territory.  Both markets proceeding to take a negative track, through to the close. 

The London market ended the day on a negative note and with 84.2% of the earlier losses of the day intact, while the New York market ended the day on a likewise negative note and with 80.6% of the earlier losses of the day intact.   This close does not assist to paint a pretty picture for the charts and with the soft Brazil Real in play, one might think that the markets are due for little better than a near to steady start for early trade today.   Against the prices set yesterday, as follows: 

LONDON ROBUSTA US$/MT                       NEW YORK ARABICA USc/Lb. 

SEP    1555 – 27                                             SEP      96.40 – 1.45

NOV   1500 – 16                                             DEC    100.65 – 1.45

JAN    1508 – 13                                             MAR   104.05 – 1.45

MAR   1526 – 12                                             MAY   106.45 – 1.45

MAY   1544 – 12                                              JUL    108.85 – 1.45

JUL    1561 – 12                                              SEP    111.20 – 1.45

SEP    1578 – 12                                              DEC   114.65 – 1.40

NOV   1591 – 12                                              MAR   117.95 – 1.35

JAN    1604 – 11                                              MAY   120.00 – 1.35

MAR   1620 – 11                                              JUL    121.80 – 1.35


Coffee Market Report September 13 2018

Cecafé the Brazilian coffee exporters association have reported that the country exported 768,000 bags or 33.4% more coffee in August this year than the same month last year, at a total of 3,067,000 bags.  These exports Cecafé comment, are the largest monthly volume for the past two years. 

Noticeable within these exports and following a bumper crop this year, was that within these exports the conilon robusta coffees were 508,000 bags or 1,751.7% higher than the same month last year, at a total of 537,000 bags.   Making one guess that with the cup profile of conilon robusta coffees that is somewhat acceptable to the North American roasters but not so for many European roasters, that a percentage of these coffees might be destined for the certified robusta coffee stocks of the London market. 

Potentially with these conilon robusta coffees now coming to the consumer markets, they shall provide a degree of price competition for the forthcoming new Vietnam crop.  While if they start to come to the certified robusta coffee stocks of the London exchange, they might on the longer term prove to be a bit of a negative factor for sentiment within this market in the coming months.   Albeit that presently these stocks which were registered at 1,275,667 bags on the 10th. September, are still relatively modest. 

The November 2018 to December 2018 contracts arbitrage between the London and New York markets narrowed yesterday, to register this at 33.34 usc/Lb., while this equates to 32.65% price discount for the London Robusta coffee market.   

The Certified washed Arabica coffee stocks held against the New York exchange were seen to increase by 12,282 bags yesterday; to register these stocks at 2,287,316 bags.  There were meanwhile a larger in number 19,652 bags decrease in the number of bags pending grading for this exchange; to register these pending grading stocks at 152,802 bags. 

Many of the commodity markets encountered a softening U.S. dollar yesterday which assisted many markets to show some degree of buoyancy, with the overall macro commodity index taking a positive track for the day.   The Oil, Sugar, Cocoa, Coffee, Copper and Gold markets ended the day on a positive note, while the Cotton market ended the day on a softer note.  The Reuters Equal Weight Continuous Commodity Index that is made up from 17 markets is 0.60% higher; to see this index registered at 404.86.  The day starts with the U.S. Dollar showing some degree of buoyancy and trading at 1.303 to Sterling, at 1.162 to the Euro and with the dollar buying 4.161 Brazilian Real, while North Sea Oil is near to steady and is selling at US$ 79.45 per barrel. 

The London and New York markets started the day yesterday trading around par and with both markets remaining close to par, into the early afternoon trade.   As the afternoon progressed the London market started to attract support and moved up into positive territory and soon followed by a move north for the New York market and with both markets triggering buy stops, to accentuate the gains.  The New York market did however start to attract selling at the highs and to fall back a bit for late trade, while the London market retained most of its muscle.  

The London market ended the day on a very positive note and with 88.4% of the earlier gains of the day intact, while the New York market ended the day on a positive note and with 67.3% of the earlier gains of the day intact.  This close and with the ability of the markets to bounce back from the lows and with the funds already well sold short, might assist to inspire some degree of confidence, to set the markets for a follow through steady close for early trade today against the prices set yesterday, as follows: 

LONDON ROBUSTA US$/MT                       NEW YORK ARABICA USc/Lb. 

SEP    1582 + 38                                             SEP      97.85 + 1.65

NOV   1516 + 38                                             DEC    102.10 + 1.65

JAN    1521 + 40                                             MAR   105.50 + 1.65

MAR   1538 + 42                                             MAY   107.90 + 1.60

MAY   1556 + 43                                              JUL    110.30 + 1.60

JUL    1573 + 43                                              SEP    112.65 + 1.60

SEP    1590 + 43                                              DEC   116.05 + 1.60

NOV   1603 + 42                                              MAR   119.30 + 1.55

JAN    1615 + 41                                              MAY   121.35 + 1.60

MAR   1631 + 40                                              JUL    123.15 + 1.65


Coffee Market Report September 12 2018

The latest assessment of the traditionally very conservative Brazil Institute of Geography and Statistics for the new Brazil coffee crop that they now estimate at 57.4 million bags, is proving to be yet another negative nail for sentiment within the coffee markets.  One would usually see this institutes numbers to be approximately 10% below reality and if one is to extrapolate the number, it is supportive for the many other forecasts that had pegged this crop at between 62 million and 64 million bags. 

The forecasts for early spring rains due over the main coffee districts in Brazil and the softening of the Brazil Real relative to the U.S. dollar over and above the prospects for a surplus coffee supply for the new October 2018 to September 2019 coffee year, had its impact within the volatile New York market yesterday.  A market that looks to fundamental news that aside from some problems in India, is nothing but negative in nature. 

This is a dismal situation for coffee farmers in both the Mexican and Central American producer bloc and Vietnam, with their new crop harvest now only a few weeks away from starting, as they focus upon soft reference prices within the coffee terminal markets.  While with the mainstream coffee markets in Europe, North America and Japan having had an extraordinarily hot summer that has impacted upon overall coffee consumption, it has resulted in more than sufficient stocks at hand within these markets, to limit the volumes of nearby demand.  

The November 2018 to December 2018 contracts arbitrage between the London and New York markets narrowed yesterday, to register this at 33.41 usc/Lb., while this equates to 33.26% price discount for the London Robusta coffee market.   

The Certified washed Arabica coffee stocks held against the New York exchange were seen to increase by 11,245 bags yesterday; to register these stocks at 2,275,034 bags.  There were meanwhile a larger in number 17,634 bags decrease in the number of bags pending grading for this exchange; to register these pending grading stocks at 172,454 bags. 

The Certified Robusta coffee stocks held against the London exchange were seen to increase by 32,500 bags or 2.61% over the week of trade leading up to Monday 10th. September, to see these stocks registered at 1,275,667 bags on the day. 

Many of the commodity markets encountered a relatively steady U.S. dollar yesterday and with a mixed day for the markets, to see the overall macro commodity index taking a steady track for most of the day.  The Oil and Gold markets ended the day on a positive note and the London robusta coffee market ended the day on a steady note, while the Sugar, Cocoa, New York arabica Coffee, Cotton and Copper markets ended the day on a softer note.   The Reuters Equal Weight Continuous Commodity Index that is made up from 17 markets is 0.32% lower; to see this index registered at 402.45.  The day starts with the U.S. Dollar steady and trading at 1.300 to Sterling, at 1.158 to the Euro and with the dollar buying 4.152 Brazilian Real, while North Sea Oil is showing a degree of buoyancy and is selling at US$ 79.25 per barrel. 

The London market started the day yesterday trading marginally south of par and the New York market started the day with modest buoyancy and with both the markets heading into the early afternoon trade, on a steady note.    As the afternoon progressed the London market initially added some value and the New York market struggled to maintain par, with the New York market attracting sell stop and heading south on steady negative track and the London market slipping back towards par. 

The London market ended the day on a modestly positive note and with 9.1% of the earlier gains of the day intact, while the New York market ended the day on a negative note and with 55.2% of the earlier losses of the day intact.  This close does little to inspire confidence and one might think that the markets are due for little better than a near to steady start for early trade today, against the prices set yesterday, as follows: 

LONDON ROBUSTA US$/MT                       NEW YORK ARABICA USc/Lb. 

SEP    1544 + 7                                               SEP      96.20 – 1.30

NOV   1478 + 1                                               DEC    100.45 – 0.80

JAN    1481 unch                                           MAR   103.85 – 0.80

MAR   1496 – 1                                               MAY   106.30 – 0.80

MAY   1513 – 2                                                JUL    108.70 – 0.80

JUL    1530 – 2                                                SEP    111.05 – 0.80

SEP    1547 – 2                                                DEC   114.45 – 0.85

NOV   1561 – 1                                                MAR   117.75 – 0.85

JAN    1574 + 1                                                MAY   119.75 – 0.85

MAR   1591 + 1                                                JUL    121.50 – 0.85