Coffee Market Report January 22 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 28.54% during the week of trade leading up to Tuesday 16th. January; to register a net short sold position of 55,050 Lots on the day. This net short-sold position which is the equivalent of 15,606,431 bags has most likely been once again decreased, following the period of mixed but overall more buoyant trade, which has since followed. 

The latest Commitment of Traders report from the London robusta coffee market has seen the Speculative Non-Commercial sector of this market decrease their net short sold position within this market by 12.79% during the week of trade leading up to Tuesday 16th. January; to register a net short sold position of 23,177 Lots on the day.  This net short sold position which is the equivalent of 3,862,833 bags has most likely been further reduced, following a period of mixed but overall more buoyant trade, which has since followed. 

There were reports of storm damage to one of the ICE Futures exchange certified warehouses in Antwerp, which has forced the exchange to Flag the 28,537 bags of certified stocks within the warehouse, for checking and suspended these coffees from deliveries against the futures contracts.  This though and with the New York Certified stocks growing daily, has had no effect upon market sentiment. 

The March 2018 to March 2018 contracts arbitrage between the London and New York markets broadened on Friday, to register this at 41.60 usc/Lb., while this equates to 34.31% 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 5,140 bags on Friday; to register these stocks at 2,017,306 bags.  There was meanwhile a larger in number 7,720 bags decrease to the number of bags pending grading for this exchange; to register these pending grading stocks at 33,029 bags.  

The commodity markets had another mixed day on Friday, with the overall macro commodity index taking a sideways to marginally softer track for most of the day.   The Sugar, New York arabica Coffee, Cotton, Orange Juice, Corn, Soybean, Gold and Silver markets had a day of buoyancy, while the Oil, Natural Gas, Cocoa, London robusta Coffee, Copper and Wheat markets had a softer day’s trade. The Reuters Equal Weight Continuous Commodity Index that is made up from 17 markets is 0.004% higher; to register this index at 426.34.   The day starts with the U.S. Dollar steady and trading at 1.387 to Sterling, at 1.223 to the Euro and 3.196 to the Brazilian Real, while North Sea Oil is steady and is selling at US$ 68.80 per barrel. 

The London market started the day on Friday on the backfoot and sinking immediately into negative territory, while the New York market started the day on a steady note and remaining mostly to the positive side of par, into the early afternoon trade.   As the afternoon progressed the New York market started to come under some pressure and to move back into negative territory, while the London market and with sell stops coming into play extended its losses and moved deeper into negative territory.  The New York market did however soon attract support and to bounce back sharply from the lows, while the London market remained deep in negative territory for the day. 

The London market ended the day on a negative note and with 86% of the earlier losses of the day intact, while the New York market ended the day on a hesitantly positive note and with 23.1% of the earlier modest gains of the day intact.   This mixed close does little to indicate direction and with the markets lacking any significant supportive fundamental news for the present, the markets are perhaps only due for a hesitantly steady start for early trade today, against the prices set on Friday, as follows: 

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

JAN    1776 – 31   

MAR   1756 – 37                                            MAR   121.25 + 0.15

MAY   1742 – 20                                            MAY   123.70 + 0.15

JUL    1770 – 21                                             JUL   126.10 + 0.20 

SEP    1775 – 20                                            SEP    128.40 + 0.15

NOV   1782 – 20                                            DEC    131.85 + 0.20

JAN    1790 – 19                                            MAR   135.10 + 0.15

MAR   1803 – 20                                            MAY   137.10 + 0.15

MAY   1820 – 21                                             JUL   138.85 + 0.10

JUL    1850 – 21                                             SEP   140.65 + 0.10