Coffee Market Report October 14 2019

The latest Commitment of Traders report from the New York arabica market has seen the Non-Commercial Speculative sector of this market increase their net short sold position within this market by 17.89% over the week of trade leading up to Tuesday 8th. October; to register a new short sold position of 47,787 Lots. This net short-sold position which is the equivalent of 13,547,403 bags has most likely been further decreased, 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 increase their net short sold position within the market by 11.66% over the week of trade leading up to Tuesday 8th. October; to register a short-sold position of 54,853 Lots.  This net short sold position which is the equivalent of 9,142,167 bags has most likely been little changed, following the period of mixed but overall softer trade that has since followed. 

The December to January contracts arbitrage between the New York and London markets broadened on Friday; to register this at 36.41 usc/Lb.  This equates to 38.86% 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 2,451 bags on Friday; to register these stocks at 2,237,904 bags.  There was a larger in number decrease to the number of bags pending grade to this exchange, by 7,425 bags; to register these pending grading stocks at 61,348 bags. 

The commodity markets were mixed in trade on Friday, to see overall macro commodity index taking a firm sideways track for the day. The Oil, Cocoa and New York Arabica Coffee markets ended the day on a positive note, the Sugar markets remained unchanged for the day, while the London Robusta Coffee, Gold, Palladium and Platinum markets ended the day on a softer note.  The Reuters Equal Weight Continuous Commodity Index that is related to 17 markets is 1.231 % higher; to see this index registered at 398.388.   The day starts with the U.S. Dollar steady and trading at 1.261 to Sterling, at 1.103 to the Euro and with the US Dollar buying 4.106 Brazilian Real. 

The London and New York markets started the day on Friday trading around par, both markets showed signs of buoyancy to trade modestly firmer into early afternoon trade. As the afternoon progressed the markets encountered selling pressure and dropped back from the highs of early trade and to dip into negative territory, The New York market attracted late in the day support to end the day on a modest positive note while the London market with no support, stayed on a softer track for much of the late afternoon trade. 

The London market ended the day on a negative note, and with 32.6% of the earlier losses of the day intact, while the New York market ended the day on a modest positive note, and with 23.53% of the earlier gains of the day intact. This close and with prospects of a large Brazil crop next year, there remains a bearish sentiment in the markets.  One would think the markets are due little better than a cautious start to early trade today, against the prices set on Friday, as follows:   

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

NOV   1242 – 15                                                       DEC      93.70 + 0.20

JAN    1263 – 14                                                       MAR     97.35 + 0.20

MAR   1287 – 14                                                       MAY     99.70 + 0.15

MAY   1314 – 14                                                       JUL    101.95 + 0.20

JUL    1341 – 14                                                       SEP    104.00 + 0.20

SEP    1369 – 13                                                       DEC   107.00 + 0.25

NOV   1398 – 12                                                       MAR   109.90 + 0.25

JAN    1426 – 12                                                       MAY   111.70 + 0.25

MAR   1454 – 12                                                       JUL    113.45 + 0.25