Coffee Market Report December 27 2018

The coffee markets remain devoid of any striking supportive fundamental news, while with leading Western European consumer bloc on holiday yesterday, there was mostly only thin trade within the North American commodity markets for the day.   Albeit that the North American equity markets posted a positive correction for the day, post the negative stance that was taken ahead of the Christmas holiday. 

Meanwhile with the combination of a slightly delayed new crop and some degree of internal market price resistance on the part of the farmers, there are presently only very low volumes of new crop Central American coffees being tendered to the certified washed arabica coffee stocks of the New York market.  This one might speculate though is only a short-term factor and that by the second quarter of the coming year, there are likely to be significant volumes due to come to these stocks. 

The March 2019 to March 2019 contracts arbitrage between the London and New York markets broadened on yesterday, to register this at 35.18 usc/Lb., while this equates to 33.86% 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 550 bags on yesterday; to register these stocks at 2,460,669 bags.  There was meanwhile no change to the number of bags pending grading for this exchange; to register these pending grading stocks at 18,341 bags. 

The commodity markets lacked participation from the Western Europeans, but with the overall macro commodity index for the U.S.A. markets taking an upside track for the day.  The Oil, Cocoa and Coffee markets ended the day on a positive note, while the Sugar market was near to steady for the day.  The Reuters Equal Weight Continuous Commodity Index that is made up from 17 markets is 1.33% higher; to see this index registered at 396.28.   The day starts with the U.S. Dollar steady and trading at 1.265 to Sterling, at 1.138 to the Euro and with the dollar buying 3.922 Brazilian Real. 

The New York market trading solo yesterday, started the shortened day of trade in a hesitant manner and with some early losses, before being assisted by the positive sentiment of the buoyancy of the overall macro commodity index and bouncing back into positive territory.   Setting the market on track for a positive close for the day. 

The New York market ended the day on a very positive note and with 94.4% of the earlier gains of the day intact.   This follow through recovery does though encounter the negative aspect of a softer Brazil Real and global participation within the both markets today, but with many players likely to be on holiday.   Thus, one might think that trade shall be slow and with possibly some early buoyancy for the London market and a near to steady start for the New York market, for early trade today.   Against the prices set in London on Monday and in New York yesterday, as follows: 

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

JAN    1485 + 24                                             MAR   103.90 + 1.70

MAR   1515 + 24                                             MAY   107.00 + 1.70

MAY   1534 + 24                                              JUL    109.80 + 1.65

JUL    1551 + 24                                              SEP    112.55 + 1.60

SEP    1570 + 24                                              DEC   116.30 + 1.55

NOV   1590 + 24                                              MAR   120.05 + 1.50

JAN    1608 + 24                                              MAY   122.55 + 1.55

MAR   1630 + 24                                              JUL    124.90 + 1.50

MAY   1653 + 24                                              SEP    127.15 + 1.50

JUL    1670 + 24                                              DEC    130.25 + 1.50