Coffee Market Report March 05 2019

The National Coffee Institute in Costa Rica has reported that the country’s coffee exports for the month of February were relatively flat when compared to the same month in the previous coffee year. The February export figures are reported at 108,413 bags, an increase of 0.30% on that of the same month last year.

With the current Brazil crop that is a biennial bearing record coffee crop flowing to consumer markets, this larger biennial bearing crop is already considered to be factored in to the markets and the focus has perhaps turned to the prospects for supply from the next and lower biennial bearing crop that is developing in Brazil. The latest in the round of these estimates, to come from the respected Rabobank who have released their forecast for the lower biennially bearing Brazil 2019 crop at an estimated 57.60 million bags, subsequent to the crop survey conducted. This estimate is related to a relatively large new conilon robusta coffee crop estimate at 19.5 million bags and a new arabica coffee crop at 38 million bags. This forecast may be viewed to be within the median estimate for the coming year, following a Reuters Poll conducted earlier including leading trade and market analyst forecasts, at 55 million bags.

The Certified washed Arabica coffee stocks held against the New York exchange declined by 275 bags yesterday; to register these stocks at 2,478,495 bags. The number of bags pending grading to the exchange were unchanged on the day, to register these pending grading stocks at 33,226 bags.

It was a mixed and overall lower day for the commodity markets, the latest round of economic data indicators from USA influencing a lower day overall, the US Dollar buoyant as the markets anticipate the next round of China and USA tariff negotiations. It was a firmer day for the Oil markets, Corn, Orange Juice, Soybean, the exceptions across the commodities board which finished the day in softer territory, Sugar, Cocoa, Coffee, Cotton, Copper, Wheat Gold, Silver, Platinum and Palladium, all lower on the day. The Reuters Equal Weight Continuous Commodity Index that is made up from 17 markets is 0.70% lower; to see this index registered at 399.90. The day starts with the U.S. Dollar steady and trading at 1.315 to Sterling, at 1.132 to the Euro and with the US Dollar buying 3.77 Brazilian Real.

The coffee markets started the day on a buoyant note and in mildly positive territory in thin trade. The early morning session in New York faltering, to slip back through par with a mild recover to the positive ahead of the America’s opening for their business day. London continued in thin trade through the morning session in the the afternoon, hardly changed around par. The participating volumes increased in New York and the general overall softer trend across the macro leaned in to weigh on sentiment and value in New York as the afternoon progressed to see both markets slip incrementally lower as the day drew to a close, to finish the day in both markets, at the low of the day and on a softer note, to set the close yesterday as follows:

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

MAR   1,505 - 12                     MAR   94.10 - 2.85
MAY    1,521 - 13                     MAY   97.35 - 2.85
JULY   1,533 - 10                    JULY 100.00 - 2.85
SEPT  1,549 -  7                     SEPT 102.65 - 2.85
NOV    1,565 -  7                     DEC 106.45 - 2.80
JAN     1,581 -  8                     MAR 110.20 - 2.80
MAR    1,598 - 10                    MAY 112.60 - 2.75
MAY    1,616 - 11                    JULY 114.90 - 2.65
JULY   1,632 - 14                    SEPT 117.15 - 2.60
SEPT  1,650 - 15                     DEC 120.45 - 2.55