Coffee Market Report October 22 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 increase their net short sold position within the market by 21.01% over the week of trade leading up to Tuesday 15th. October; to register a new net short sold position of 65,270 Lots.  Meanwhile the longer term in nature Index Fund sector of this market decreased their net long position within the market by 0.04%, to register a net long position of 41,305 Lots on the day. 

Over the same week, the Non-Commercial Speculative sector of this market increased their net short sold position within this market by 22.6%; to register a new net short sold position of 58,590 Lots. This net short-sold position which is the equivalent of 16,610,005 bags has most likely been further increased, following the period of mixed but overall softer trade that has since followed and likewise, that of the Managed Money Fund sector of the market. 

The December to January contracts arbitrage between the New York and London markets broadened yesterday; to register this at 39.92 usc/Lb.  This equates to 41.43% 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 3,513 bags yesterday; to register these stocks at 2,259,671 bags, with 86.9% of these certified stocks being held in Europe at a total of 1,964,971 bags and the remaining 13.1% being held in the USA at a total of 294,700 bags.  There was a larger in number decrease to the number of bags pending grade to this exchange, by 4,752 bags; to register these pending grading stocks at 32,458 bags.

The commodity markets were softer in trade on yesterday, to see overall macro commodity index taking a soft sideways track for the day. The New York Arabica Coffee and Copper markets ended the day on a positive note, while the Oil, Natural Gas, Sugar, Cocoa, London Robusta Coffee, Cotton, Orange Juice, Wheat, Corn, Soybean, Gold and Silver markets ended the day on a softer note.  The Reuters Equal Weight Continuous Commodity Index that is related to 17 markets is 0.452 % lower; to see this index registered at 399.539.   The day starts with the U.S. Dollar steady, trading at 1.299 to Sterling, at 1.115 to the Euro and with the US Dollar buying 4.128 Brazilian Real. 

The London and New York markets started the day yesterday trading on a modest positive note, both the London and the New York market maintained this stance into the early afternoon trade. As the afternoon progressed the New York market with buying support gained traction with the London market following suit in a more sedate manner. Both the New York and the London market however fell back from the highs of the day to trade in negative territory for the late afternoon trade. 

The London market ended the day on a modest negative note, and with 53.8% of the earlier losses of the day intact, while the New York market ended the day on a modest positive note, and with 50% of the earlier gains of the day intact. This close is unlikely to inspire confidence and one would think with the Brazil Real showing signs of weakness, is likely to set the markets for little better than a near to steady start for early trade today, against the prices set yesterday, as follows:   

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

NOV   1209 – 7                                                            DEC      96.35 + 0.65

JAN    1244 – 7                                                            MAR     99.70 + 0.60

MAR   1269 – 5                                                            MAY   101.90 + 0.55

MAY   1293 – 5                                                            JUL    103.90 + 0.45

JUL    1318 – 5                                                            SEP    105.65 + 0.40

SEP    1344 – 5                                                            DEC   108.35 + 0.35

NOV   1372 – 5                                                            MAR   110.95 + 0.25

JAN    1399 – 6                                                            MAY   112.55 + 0.20

MAR   1427 – 5                                                            JUL    114.10 + 0.15