Coffee Market Report June 19 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 33.81% over the week of trade leading up to Tuesday 12th June; to register a new net short sold position of 50,863 Lots. Meanwhile the longer term in nature Index Fund sector of this market decreased their net long position within the market by 4.32%, to register a net long position of 33,398 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 28.57%, to register a net short sold position of 48,050 Lots. This net short sold position which is the equivalent of 13,621,196 bags has most likely been decreased, following the period of mixed but overall buoyant trade that has since followed and likewise, that of the managed money fund sector of the market.

The Commitment of Traders report from the London Robusta coffee market has seen the Speculative Non-Commercial sector of the market increase their net short sold position twice since last reported on 29th May. The position on 5th June registered at 17,497 Lots whereas the latest Commitment of Traders report from the London robusta coffee market has seen the Speculative Non-Commercial sector of this market increase their net short sold position within this market by 31.24% during the week of trade leading up to Tuesday 12th June; to register a net short sold position of 22,964 Lots on the day. This net short sold position which is the equivalent of 3,827,333 bags is likely to be nominally reduced, following the period of mixed trade that has since followed.

The September 2018 to September 2018 contracts arbitrage between the London and New York markets narrowed yesterday, to register this at 40.18 usc/Lb., while this equates to 34.43% 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 4,491 bags yesterday; to register these stocks at 2,052,270 bags. There was meanwhile an increase of 303 bags in the number of bags pending grading for this exchange; to register these pending grading stocks at 23,517 bags.

It was a mixed and overall lower day on the commodity markets yesterday, the news headlines and market speculative focus turned to the latest round of a developing trade tariff spat between the two largest economies U.S.A. and China, which contributed to a degree of uncertainty in the markets. Separately the leading in influence Oil markets registered a surge in value and finished the day on a positive note. The Oil markets positive and the US Dollar mildly firmer, it was a steady day for Gold and Soybean and a softer day for Corn, Cocoa, Coffee, Cotton, Copper, Sugar, Orange Juice, Wheat, Silver, Platinum and Palladium markets. The Reuters Equal Weight Continuous Commodity Index that is made up from 17 markets is 0.519% lower, to see this index registered at 425.28. The day starts with the U.S. Dollar steady and trading at 1.325 to Sterling, at 1.162 to the Euro, with the US Dollar buying 3.74 Brazilian Real, while North Sea Oil is firm in early trade and selling at US$ 75.09 per barrel.

The coffee markets started the day on a hesitantly positive note and as activity increased in the morning session, both markets continued to maintain a positive track. The Brazil Real shed a portion of the overnight gains against the US Dollar as the day progressed, while the overall weight of the macro across the commodity sector is likely to have contributed toward a gradual and etched decline in value in London toward the latter half of the day and so too, in New York which lost the battle for positive territory quite early on in the session to trade below par for much of the afternoon. While London managed to trade mostly in positive territory for the better part of the day, it was an overall softer performance in New York ahead of first notice day 21st June, for the prompt month in this market. The close yesterday after a fair volume day in London and a good volume day registered in New York, set the close in both markets on a softer note near to the lows of the day, as follows:

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


JULY  1,701 - 5                 JULY 114.45 - 0.75
SEPT 1,687 - 3                 SEPT 116.70 - 0.85
NOV   1,693 - 2                 DEC 120.15 - 0.85
JAN    1,701 - 3                 MAR 123.65 - 0.85
MAR  1,713 - 3                  MAY 126.00 - 0.85
MAY   1,725 - 3                 JULY 128.20 - 0.85
JULY  1,736 + 1                SEPT 130.15 - 0.85
SEPT 1,749 + 1                DEC 132.95 - 0.85
NOV   1,763 + 1                MAR 135.75 - 0.85
JAN   1,766 + 1                 MAY 137.45 - 0.85