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