Coffee Market Report July 06 2017

The Colombian Coffee Federation have reported that the countries coffee production for the month of June to be 109,000 bags or 9.41% lower than the same month last year, at a total of 1,049,000 bags.   This dip in production follows many months of improved production volumes, followed by climatically influenced lower forecast Mitaca harvest and contributes to the countries cumulative coffee production for the first nine months of the present October 2016 to September 2017 coffee year to being 55,000 bags higher than the same period in the previous coffee year, at a total of 10,783,000 bags.

In terms of coffee exports from Colombia the Coffee Federation have reported that the countries coffee exports for the month of June were 32,000 bags higher than the same month last year, at a total of 964,000 bags.   This contributes to the countries cumulative exports for the first nine months of the present October 2016 to September 2017 coffee year to being 654,000 bags or 6.87% higher than the same period in the previous coffee year, at a total of 10,173,000 bags.

The September to September contracts arbitrage between the London and New York markets widened yesterday, to register this at 32.16 usc/Lb., while this equates to a 24.73% 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 3,981 bags on Wednesday; to register these stocks at 1,517,763 bags.  There were meanwhile a larger in number 4,840 bags decrease to the number of bags pending grading for this exchange; to register these pending grading stocks at 52,280 bags.

The markets opened post the U.S.A. Independence Day holiday yesterday in mixed sentiment, as speculative focus on the release of U.S. Federal Reserve minutes were inconclusive and provided little guidance as to the likelihood (or not), of another interest rate hike to be announced within the calendar year.  The U.S. Dollar registered a firmer day and the commodities sector generally softer overall.  It was a lower day for the oil markets, Sugar, Cocoa, Cotton, Copper and a positive day for Coffee, Orange Juice, Wheat, Corn and Soybean markets, similarly a firm day for Gold but a lower day in Silver, Platinum and Palladium markets.  The Reuters Equal Weight Continuous Commodity Index registered a lower 0.356% result on the day and registered at 403.36.  The day starts with the U.S. Dollar steady and trading at 1.2935 to Sterling and at 1.133 to the Euro, while North Sea Oil is steady and is selling at US$ 47.77 per barrel.

The coffee markets opened the day yesterday in positive territory in limited volume, that after a brief spurt upward met with a degree of selling pressure and both markets slipped back in the early morning.  London broke below par briefly before posting a recovery back to positive territory where this market held within a narrow range and relatively modest volume for the rest of the day. Subsequent to the holiday on 4th July, the New York market lead by short covering rose incrementally through the session to touch upon the high of the day in the last couple of hours of trade, to register a reversal almost immediately to the lower as the session drew to a close.   It was a buoyant day for both markets in positive territory, with London in modest volume and New York after a good volume session, finishing the day closer to the days highs in both markets, to set the close yesterday, as follows: 

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

JUL    2192 + 11                                            JUL    127.65 + 1.80 
SEP    2157 +  8                                             SEP   130.00 + 2.30
NOV   2140 +  8                                             DEC   133.40 + 2.30
JAN    2111 +  4                                             MAR   136.80 + 2.20
MAR   2100 +  3                                             MAY   139.10 + 2.20
MAY   2102 +   1                                            JUL    141.30 + 2.25
JUL    2118  +  1                                            SEP    143.35 + 2.25
SEP    2133 +  7                                             DEC   146.15 + 2.15
NOV   2140 + 34                                            MAR   148.85 + 2.15
JAN    2147 + 34                                            MAY   150.45 + 2.15