Coffee Market Report June 10 2019

The latest Commitment of Traders report from the New York arabica coffee market has seen the Non-Commercial Speculative sector of this market decrease their net short sold position within this market by 34.16%; over the week of trade leading up to Tuesday 4th. June; to register a new net short sold position of 41,112 Lots.  This net short-sold position which is the equivalent of 11,655,070 bags has most likely been increased again, following the period of overall more negative trade that 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 decrease their net short sold position within the market by 25.93% over the week of trade leading up to Tuesday 4th. June; to register a short-sold position of 25,846 Lots.  This net short sold position which is the equivalent of 4,307,667 bags has most likely been increased again, following the period of overall more negative trade that has since followed. 

Today is the Pentecost or Whit Monday holiday for many countries and including many of the Western European countries, which shall dampen physical coffee trade for the day.   This long weekend holiday does not though, impact upon the USA and the UK and with almost all coffee producers not recognising the holiday, one might expect that the speculative activity within the volatile coffee terminal markets shall continue as usual.   

The September to September contracts arbitrage between the London and New York markets narrowed on Friday, to register this at 37.60 usc/Lb., while this equates to 36.29% 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 3,950 bags on Friday; to register these stocks at 2,384,718 bags.  There was meanwhile no change to the number of bags pending grading for this exchange; to register these pending grading stocks at 1,908 bags. 

The commodity markets were mixed in trade on Friday, with the overall macro commodity index on a marginally softer track for the day.  The Oil, Natural Gas, Cocoa, Gold and Silver markets ended the day on a positive note and the London robusta Coffee market was steady for the day, while the Sugar, New York arabica Coffee, Cotton, Copper, Orange Juice, Wheat, Corn and Soybean markets ended the day on a softer note.  The Reuters Equal Weight Continuous Commodity Index that is related to 17 markets, is 0.32% lower, to see this index registered at 390.94.   The day starts with the U.S. Dollar steady and trading at 1.270 to Sterling, at 1.130 to the Euro and with the US Dollar buying 3.877 Brazilian Real. 

The London market started the day on Friday on a positive note and with the New York market trading around par, but soon joining the London market in positive territory.  This was however short lived and the New York market attracted renewed selling pressure and some sharp losses, while the London market slipped back into modest negative territory for the early afternoon trade.   The London market did though soon bounce back and to take something of a sideways track at around par for the rest of the day, while the New York market made a partial recovery and took a more modest negative sideways track for the day. 

The London market ended the day on a steady note, while the New York market ended the day on a negative note and with 54.1% of the earlier losses of the day intact.   This close provides little indication of direction, but with a lack of supportive fundamental news and evidence of a reduced speculative short position, albeit most likely increased again, one might expect the market markets to be leaning towards the bears.  To set the markets for only a hesitant near to steady start for early trade today, against the prices set on Friday, as follows: 

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

JUL    1430 – 1                                             JUL    100.95 – 1.10

SEP    1455 unch                                         SEP    103.60 – 1.00

NOV   1475 – 2                                             DEC    107.30 – 0.95

JAN    1496 – 2                                             MAR   110.90 – 0.85

MAR   1516 – 2                                             MAY   113.05 – 0.85

MAY   1535 – 2                                              JUL    114.80 – 0.85

JUL    1553 – 2                                              SEP    116.50 – 0.90

SEP    1573 – 2                                              DEC   119.20 – 0.90

NOV   1588 – 3                                              MAR   121.90 – 0.95

JAN    1603 – 3                                              MAY   123.70 – 0.90