Coffee Market Report March 11 2019

The latest Commitment of Traders report from the New York arabica coffee market has seen the Non-Commercial Speculative sector of this market increase their net short sold position within the market by 0.99% over the week of trade leading up to Tuesday 5th. March; to register a new net short sold position of 75,184 Lots.   This net short-sold position which is the equivalent of 21,314,331 bags has most likely been little changed to perhaps marginally increased again, following the period of mixed but overall softer trade which has since followed. 

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 3.93% during the week of trade leading up to Tuesday 5th. March; to register a short-sold position of 26,099 Lots on the day.  This net short position which is the equivalent of 4,349,833 bags has most likely been little changed, following the period of mixed but overall sideways trade that has since followed. 

The 7th. annual Buôn Ma Thuột Coffee festival was opened by the countries Deputy Prime Minister on Saturday, with festival to continue throughout this week.   The focus of the festival is upon improved technology and sustainability programs to improve quality, yields and the image of Vietnamese coffees, so as to improve relative profitability for the countries coffee farming industry. 

The National Coffee Association in the U.S.A. have reported that they assess that 61% of the coffee being consumed within this leading coffee consumer market is considered to be gourmet coffee, while they see little change to the volume of coffee being consumed over the past year.  Noting that within this well-developed coffee consumer market that it is more a factor that consumers are giving consideration to the quality of their coffee, rather than increasing their consumption. 

The May to May contracts arbitrage between the London and New York markets broadened on Friday, to register this at 29.10 usc/Lb., while this equates to 29.54% 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 3,069 bags on Friday; to register these stocks at 2,491,683 bags.  There was meanwhile, a smaller in number 970 bags decrease to the number of bags pending grading for this exchange; to register these pending grading stocks at 34,865 bags. 

The commodity markets were mixed in trade on Friday, to see the overall macro commodity index taking something of a sideways track for the day.   The Sugar, Cocoa, Coffee, Cotton, Wheat, Gold and Silver markets ended the day on a positive note, while the Oil, Natural Gas, Copper, Orange Juice, Corn and Soybean markets ended the day on a softer note.  The Reuters Equal Weight Continuous Commodity Index that is made up from 17 markets is 0.39% lower; to see this index registered at 399.04.   The day starts with the U.S. Dollar steady and trading at 1.297 to Sterling, at 1.123 to the Euro and with the US Dollar buying 3.867 Brazilian Real. 

The London and New York coffee markets bounced back from the previous day’s lows, with slow producer selling activity assisting to buoy the market values.  Pulling both markets back up the values of the end of last month, which sees the markets on something of a sideways track for the present. 

The London market ended the day on a positive note and with 96.2% of the earlier gains of the day intact, while the New York market ended the day on a likewise positive note and with 94.3% of the earlier gains of the day intact.  This recovery and positive end to the week and along with the evidence of the net short sold status of the speculative sector of the New York market and a hint of being over sold, might assist towards some degree of confidence.   To set the markets for a steady start for early trade today, against the prices set on Friday, as follows: 

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

MAR   1514 + 25                                            MAR     95.30 + 1.65

MAY   1530 + 25                                            MAY     98.50 + 1.65

JUL    1540 + 23                                             JUL    101.20 + 1.65

SEP    1556 + 22                                            SEP    104.00 + 1.70

NOV   1573 + 22                                            DEC    107.85 + 1.70

JAN    1590 + 22                                            MAR   111.65 + 1.65

MAR   1608 + 22                                            MAY   114.10 + 1.70

MAY   1627 + 22                                            JUL    116.35 + 1.65

JUL    1646 + 22                                            SEP    118.55 + 1.65

SEP    1665 + 22                                            DEC   121.80 + 1.60