Coffee Market Report August 14 2019

The November to December contracts arbitrage between the London and New York markets narrowed yesterday; to register this at 38.28 usc/Lb.   This equates to 39.40% 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 3,289 bags yesterday; to register these stocks at 2,362,191 bags.  There was meanwhile a larger in number decrease by 6,875 bags to the number of bags pending grading for this exchange; to register these pending grading stocks at 18,228 bags. 

The commodity markets were mixed in trade yesterday, to see the overall macro commodity index taking a modest positive track for the day. The Oil, Natural Gas, Sugar, Coffee, Cotton, Copper and Soybean ended the day on a positive note, while the Cocoa, Orange Juice, Wheat, Corn, Gold and Silver markets ending the day on a softer note.  The Reuters Equal Weight Continuous Commodity Index that is related to 17 markets is 0.28% higher; to see this index registered at 382.36.   The day starts with the U.S. Dollar steady and trading at 1.205 to Sterling, at 1.117 to the Euro and with the US Dollar buying 3.964 Brazilian Real. 

The coffee markets took a similarly positive track during trade yesterday, with the influential speculative and fund sector driving direction, supported by a degree of underlying commercial buying activity.  The overall macro reflecting a more positive day in the markets assisted confidence on the day, as did the Brazil Real which registered a stronger day against the US Dollar.   A stronger Brazil Real discourages producer selling as prices are less attractive in local currency terms. 

The London and New York markets started the day yesterday trading with modest buoyancy, with both markets moving into positive territory for the early afternoon trade. As the afternoon progressed the New York market and with a marginally firmer Brazil Real in play started to attract support and moved higher with into positive territory with the London marker following suit, but with both markets soon hitting a ceiling and limiting gains for the day.  The New York market posting hefty volumes of trade ahead of first notice day in the prompt month, next week. 

The London market ended the day on a positive note and with 85.7% of the earlier gains of the day intact, while the New York market ended the day on a likewise positive note and with 91.2% of the earlier gains of the day intact.  This positive close might assist towards some degree of confidence and to set the markets for a follow through steady start for early trade today, against the prices set yesterday, as follows:  

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

SEP    1305 + 35                                            SEP      96.35 + 2.60

NOV   1332 + 36                                             DEC     99.70 + 2.40

JAN    1356 + 34                                             MAR   103.30 + 2.35  

MAR   1385 + 34                                             MAY   105.65 + 2.30

MAY   1414 + 33                                             JUL    107.85 + 2.30

JUL    1441 + 31                                             SEP    109.90 + 2.25

SEP    1466 + 28                                             DEC   112.95 + 2.25

NOV   1490 + 24                                             MAR   115.95 + 2.20

JAN    1513 + 20                                             MAY   118.05 + 2.20

MAR   1533 + 13                                             JUL    120.05 + 2.25