Coffee Market Report March 07 2019


7th March, 2019.
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 within the market by 1.97% during the week of trade leading up to Tuesday 26th. February; to register a short-sold position of 25,111 Lots on the day. This net short position which is the equivalent of 4,185,167 bags has most likely been little changed, following the period of mixed but overall sideways trade that has since followed.

The Certified Robusta coffee stocks held against the London exchange were seen to decrease by 22,000 bags or 1.10% over the week of trade leading up to Monday 4th. March, to see these stocks registered at 1,973,833 bags, on the day.

The May to May contracts arbitrage between the London and New York markets registered at 29.21 usc/Lb., while this equates to 30.59% price discount for the London Robusta coffee market.

The Certified washed Arabica coffee stocks held against the New York exchange increased by 3,925 bags yesterday; to register these stocks at 2,484,615 bags. The number of bags pending grading to the exchange were increased by 920 bags on the day, to register these pending grading stocks at 38,476 bags.

The commodity markets had a mixed and mostly softer day yesterday, ahead of the European Central Bank meeting to be held today and anticipated announcements of the Eurozone growth and inflation forecasts to follow. The US Dollar held steady yesterday while it was a softer day for the Oil markets. The rest of the board with the exception of the remarkable recovery in Cocoa, a positive result for Sugar and a softer finish for Soybean and Wheat markets, were fairly flat on the day; Gold and Palladium settled on the upside, while Cotton, Copper, Orange Juice, Corn, Silver, and Platinum finished in negative territory. The Reuters Equal Weight Continuous Commodity Index that is made up from 17 markets is 0.49% lower; to see this index registered at 399.76. The day starts with the U.S. Dollar steady and trading at 1.317 to Sterling, at 1.139 to the Euro and with the US Dollar buying 3.84 Brazilian Real.

It was a comparatively subdued day on the coffee markets yesterday, the London Robusta market opened in mildly positive territory followed by a narrowly softer opening in New York. The day progressed in a tight range in both markets, London held a range of US$ 8.00 between the high and low throughout the session and close near to the day high in positive territory. Participation in New York similarly held in a narrow range in negative territory through the morning session with a degree of underlying buying support coming to the floor as the America’s opened their business day, to recover early losses and move back through par briefly around midsession where levels were held in a relatively narrow range into the afternoon. A general lack of fresh fundamental news accompanied by a late in the day weather report signifying continued conducive weather conditions to prevail across the vast Brazil coffee growing areas and with the next coffee crop developing toward harvest in a few months’ time. This provided little inspiration for the latter half of the already modest participation session in New York, as the Brazil Real lost ground to the US Dollar to see this market drift lower and finish at the lows on the day, to see the markets set the close yesterday, as follows:

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

MAR 1,516 + 5         MAR 95.50 - 0.95
MAY 1,532 + 5          MAY 98.70 - 0.95
JULY 1,540 + 2         JULY 101.30 - 1.00
SEPT 1,555 + 1        SEPT 104.00 - 0.95
NOV 1,571 + 1          DEC 107.80 - 0.95
JAN 1,587 + 1           MAR 111.60 - 0.90
MAR 1,604 + 1          MAY 114.05 - 0.85
MAY 1,622 + Unch    JULY 116.35 - 0.85
JULY 1,639 + Unch   SEPT 118.60 - 0.85
SEPT 1,658 + Unch  DEC 121.85 - 0.90

Kindest regards,
Natasha