Coffee Market Report November 05 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 decrease their net short sold position within the market by 8.82% over the week of trade leading up to Tuesday 29th. October; to register a new net short sold position of 58,415 Lots.  Meanwhile the longer term in nature Index Fund sector of this market increased their net long position within the market by 0.73%, to register a net long position of 43,645 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 8.30%; to register a new net short sold position of 50,777 Lots. This net short-sold position which is the equivalent of 14,395,054 bags has most likely been further decreased, 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 National Coffee Institute of Costa Rica have reported that the country’s coffee exports for the month of October were 57.8% lower than the same month last year, at a total of 9,204 bags. This is the first month of the new October 2019 to September 2020 coffee which sees the downward trend in coffee exports continue. 

The Brazil government have reported that the country’s coffee exports for the month of October were 127,600 bags or 3.89% lower than the same month last year, at a total of 3,148,100 bags. 

The December to January contracts arbitrage between the New York and London markets broadened yesterday; to register this at 44.41 usc/Lb.  This equates to 42.85% 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 1,005 bags yesterday; to register these stocks at 2,235,507 bags, with 87.3% of these certified stocks being held in Europe at a total of 1,951,795 bags and the remaining 12.7% being held in the USA at a total of 283,712 bags.  There was a larger in number decrease to the number of bags pending grade to this exchange, by 8,982 bags; to register these pending grading stocks at 6,561 bags. 

The commodity markets were mixed in trade yesterday, to see overall macro commodity index taking a modest firm sideways track for the day. The Oil, Natural Gas, Sugar, Cocoa, Copper, Orange Juice and Soybean markets ended the day on a positive note, while the Coffee, Cotton, Wheat, Corn, 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 0.029 % higher; to see this index registered at 408.076.   The day starts with the U.S. Dollar slightly weaker, trading at 1.288 to Sterling, at 1.113 to the Euro and with the US Dollar buying 4.012 Brazilian Real. 

The London market started the day yesterday trading on a modest positive note, while the New York market started the day trading on a modest negative note. Both markets retained their respective stance into the early afternoon trade. As the afternoon progressed Both the London and the New York markets moved into modest soft territory where they would continue to trade for the remainder of the day. 

The London market ended the day on a modest negative note, and with 69.6% of the earlier losses of the day intact, while the New York market ended the day on a likewise negative note, and with 25.9% of the earlier losses of the day intact. This close doesn’t provide much in the way of direction and one would think the markets are due only for another hesitant steady start for early trade today, against the prices set yesterday, as follows:   

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

NOV   1277 – 12                                                          DEC    103.65 – 0.35  

JAN    1306 – 16                                                          MAR   107.25 – 0.30  

MAR   1326 – 13                                                          MAY   109.50 – 0.15

MAY   1342 – 12                                                          JUL    111.55 – 0.10

JUL    1363 – 11                                                          SEP    113.35 – 0.05

SEP    1386 – 11                                                          DEC   115.90  Unch

NOV   1409 – 9                                                             MAR  118.55  Unch

JAN    1432 – 9                                                            MAY   120.25 + 0.10

MAR   1458 – 8                                                            JUL    121.90 + 0.20