Coffee Market Report January 07 2019

The latest Commitment of Traders report from the New York arabica coffee market will not be published during the US Federal Government partial shutdown. The advisory issued by the US Commodity Futures Trading Commission has noted that it will resume publication of these reports when the Federal Government operations return to normal.

The latest Commitment of Traders report from the London robusta coffee market has seen the Speculative Managed Money sector of this market increase their net short sold position by 171 Lots during the week of trade leading up to Monday, 31st December; to register a short-sold position of 25,784 Lots on the day. This net short sold position which is the equivalent of 4,297,333 bags, has most likely been increased, following the period of mixed trade that has since followed.

The March to March contracts arbitrage between the London and New York markets widened on Friday, to register this at 31.52 usc/Lb., while this equates to 31.02% price discount for the London Robusta coffee market.

The Certified washed Arabica coffee stocks held against the New York exchange registered a decrease by 5,482 bags on Friday to register these stocks at 2,451,431 bags. There was an increase of 4,032 bags in the number of bags pending grading for the exchange, to register these pending grading stocks at 59,420 bags.

The commodity markets took an overall positive track on Friday, the latest round of US employment data, prospective trade tariff discussions scheduled this week, along with an overall improvement in the US stock market performance, assisted to buoy sentiment. The US Dollar lost some ground against a basket of other major currencies. It was a positive day for the Oil markets, Sugar, Cotton, Copper, Wheat, Corn, Soybean, Platinum and Palladium markets were all positive on the day, although it was a softer finish for Cocoa, Coffee, Orange Juice, Gold and Silver markets. The Reuters Equal Weight Continuous Commodity Index that is made up from 17 markets is 0.888% higher; to see this index registered at 397.56. The day starts with the U.S. Dollar steady and trading at 1.2745 to Sterling, at 1.1423 to the Euro and the US Dollar buying 3.713 Brazilian Real, while North Sea Oil is steady at US$ 56.57 per Barrel.

The coffee markets opened the day on Friday on a mildly softer note in London, followed by a narrowly positive opening in New York, where the markets drifted unchanged in low volume of trade for the duration of the early session. The lack of fundamental news within the markets was evident as the markets slipped back into negative territory by midsession to be met with buy stop triggers in New York and a relatively quick recovery back towards par as the day progressed. London tracked New York to the low of the day around midsession, with renewed buying activity providing a boost back toward, although not quite reaching, par as the day drew to a close, to finish on the lower side of the days’ trading range. The last quarter of the day saw trade volumes improve in New York and this market tracked upwards to par where levels remained within a narrow range for the rest of the session and toward the very end of the day slipped back, to settle within the middle of the days’ trading range. The markets set the close on Friday in mildly softer territory, as follows:

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

JAN   1,525 - 12               MAR 101.60 - 0.55
MAR  1,545 - 11               MAY 104.65 - 0.50
MAY  1,562 - 11               JULY 107.50 - 0.45
JULY 1,578 - 11               SEPT 110.30 - 0.45
SEPT 1,595 - 10              DEC  114.15 - 0.50
NOV   1,613 - 9                MAR 117.85 - 0.55
JAN   1,631 - 8                 MAY  120.30 - 0.55
MAR  1,652 - 8                JULY  122.60 - 0.55
MAY   1,674 - 7                SEPT 124.85 - 0.55
JULY  1,691 - 7                DEC  128.05 - 0.55