Coffee Market Report September 03 2019

The latest Commitment of Traders report from the New York arabica coffee market has seen the shorter term in nature Managed Money fund sector of this market increased their net short sold position within the market by 1.3% over the week of trade leading up to Tuesday 20th. August; to register a new net short sold position of 47,922 Lots.  Meanwhile the longer term in nature Index Fund sector of this market decreased their net long position within the market by 0.07%, to register a net long position of 40,586 Lots on the day. 

Over the same week, the Non-Commercial Speculative sector of this market decreased their net short sold position within this market by 3.04%; to register a new net short sold position of 46,149 Lots. This net short-sold position which is the equivalent of 13,083,037 bags has most likely been little changed, following the period of mixed but overall sideways trade that has since followed and likewise, that of the Managed Money Fund sector of the market. 

The Brazil government have reported that the country’s coffee exports for the month of August were 728,600 bags or 32.3% higher than the same month last year, at a total of 2,984,500 bags. 

The National Coffee Institute of Costa Rica have reported that the country’s coffee exports for the month of August were 4% lower than the same month last year, at a total of 57,055 bags. This they say has contributed to the cumulative coffee exports for the first eleven months of the present October 2018 to September 2019 coffee year to be 12% lower than the same period in the previous coffee year, at a total of 1.04 million bags. 

The National Coffee Institute of Honduras have reported that the country’s coffee exports for the month of August were 28.3% lower than the same month last year, at a total of 339,566 bags. This they say has contributed to the cumulative coffee exports for the first eleven months of the present October 2018 to September 2019 coffee year to be 4% lower than the same period in the previous coffee year, at a total of 6.63 million bags. 

The Indonesian government trade data from Sumatra which is the leading coffee producing island within Indonesia, has reported that the islands robusta coffee exports for the month of August were 48,080 bags or 16.61% lower than the same month last year, at a total of 241,300 bags.  This contributes to the islands cumulative robusta coffee exports for the first eleven months of the present October 2018 to September 2019 coffee year to be 272,657 bags or 14.06% lower than the same period in the previous coffee year, at a total of 1,666,922 bags. 

The November to December contracts arbitrage between the London and New York markets broadened on yesterday; to register this at 36.57 usc/Lb.   This equates to 37.76% 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 14,675 bags on Friday; to register these stocks at 2,332,924 bags.  There was meanwhile a 8,903 bags increase to the number of bags pending grading for this exchange; to register these pending grading stocks at 16,361 bags. 

The commodity markets lacked the participation of the US markets yesterday, as the country celebart6ed their labour day public holiday. The London Sugar and Cocoa markets ended the day on a positive note, while the London robusta Coffee market ended the day on a softer note. The Reuters Equal Weight Continuous Commodity Index that is related to 17 markets is registered at 383.50.   The day starts with the U.S. Dollar showing some degree of muscle and trading at 1.203 to Sterling, at 1.094 to the Euro and with the US Dollar buying 4.186 Brazilian Real. 

The London market trading solo opened the day yesterday marginally south of par and in thin and lacklustre trade, maintained this stance into the early afternoon trade. As the afternoon progressed the market came under pressure and moved deeper into negative territory, but managed to bounce off the lows and limit its losses in late trade. 

The London market ended the day on a negative note, but having recovered 68.7% of the earlier losses of the day by the close. This close was related to thin trade and provides little indication for direction, but with a weaker Brazil Real in play, one would think that it shall impact upon sentiment and set the markets for little better than a near to steady start for early trade today, against the prices set in London yesterday and New York on Friday, as follows:  

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

SEP    1305 – 7                                                     SEP      93.60 + 1.70

NOV   1329 – 5                                                      DEC      96.85 + 1.60 

JAN    1352 – 3                                                     MAR   100.30 + 1.50 

MAR   1376 – 2                                                      MAY   102.55 + 1.40

MAY   1401 – 1                                                      JUL    104.70 + 1.35

JUL    1426 no change                                         SEP    106.65 + 1.30

SEP    1453 no change                                         DEC   109.60 + 1.30

NOV   1480 no change                                         MAR   112.50 + 1.25

JAN    1507 no change                                         MAY   114.50 + 1.20

MAR   1532 no change                                         JUL    116.45 + 1.15