Coffee Market Report April 29 2019

The General Statistics Office in Vietnam and with most of the April registrations in hand, have estimated that the coffee exports for the month of April shall be approximately 2.33 million bags and at a value of 235 million U.S. dollars.   This they say shall result in the cumulative exports for the first four months of this year to be 13.5% lower than the same period last year, at a total of in excess of 10.48 million bags.  

The matter of concern and reflective of the soft prices of the reference prices of the coffee terminal markets, is that they report that the revenue from the country’s coffee exports is 22.6% lower than the same period last year, at a total of 1.09 billion U.S. dollars. 

This more significant percentage dip in value of the country’s coffee exports out of Vietnam for the first four months of this year being a common factor for coffee producers in general and contributing to despair upon the part of coffee farmers and including, those producers who have received some partial relief from weaker domestic currency.   With many coffee producers as a result of this, experiencing internal market price resistance from farmers and with many producers experiencing slow export selling activity at present.  

The Ivory Coast as West Africa’s largest robusta coffee producer, has reported that the countries coffee exports for the first three months of this year are 151% higher than the same period last year, at a total of approximately 258,333 bags.     

The July to July contracts arbitrage between the London and New York markets narrowed on Friday, to register this at 30.14 usc/Lb., while this equates to 32.03% 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 1,597 bags on Friday; to register these stocks at 2,466,438 bags.  There were meanwhile no Change to the number of bags pending grading for this exchange; to register these pending grading stocks at 10,260 bags. 

The commodity markets were mixed in trade on Friday, but with the relatively sharp decline in the influential Oil markets contributing towards a modest softening of the overall macro commodity index.   The Natural Gas, Cocoa, Coffee, Copper, Wheat, Corn, Gold and Silver markets ended the day on a positive note, while the Oil, Sugar, Cotton, Orange Juice 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 0.03% lower; to see this index registered at 400.04.   The day starts with the U.S. Dollar near to steady and trading at 1.293 to Sterling, at 1.116 to the Euro and with the US Dollar buying 3.929 Brazilian Real. 

The London and New York markets started the day on Friday trading around par, but with the London market soon picking up a degree of buoyancy and to see the London market taking a positive track and the New York market a steady track, into the early afternoon trade.  As the afternoon progressed, the London market maintained a positive track and finally followed in later trade, by the New York market moving up into positive territory. 

The London market ended the day on a positive note and with 87% of the earlier gains of the day intact, while the New York market ended the day on a likewise positive note and with 71.4% of the earlier gains of the day intact.   This positive close might assist to inspire a degree of confidence and set the markets for a hesitant steady start for early trade today, against the prices set on Friday, as follows: 

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

MAY   1388 + 20                                            MAY     92.70 + 0.65

JUL    1410 + 20                                            JUL       94.10 + 0.75

SEP    1425 + 17                                            SEP      96.50 + 0.75

NOV   1443 + 15                                            DEC    100.15 + 0.65

JAN    1461 + 14                                            MAR   103.80 + 0.60

MAR   1481 + 14                                            MAY   106.10 + 0.55

MAY   1502 + 14                                            JUL     108.30 + 0.50

JUL    1524 + 14                                            SEP     110.35 + 0.45

SEP    1543 + 14                                            DEC    113.40 + 0.40

NOV   1562 + 14                                             MAR   116.40 + 0.35