Coffee Market Report November 07 2019

The National Coffee Growers Federation in Colombia have reported that the country’s coffee production for the month of October was 283,000 bags or 26% higher than the same month last year, at a total of 1,369,000 bags. This is the first month of the new October 2019 to September 2020 coffee year and tends to suggest a positive start to the country’s main coffee harvest. 

The National Coffee Growers Federation in Colombia have also reported that the country’s coffee exports for the month of October were 135,000 bags or 12.5% higher than the same month last year, at a total of 1,211,000 bags. This is the first month of the new October 2019 to September 2020 coffee year and with an increase in production but a decrease in exports compared to the previous year shows us that the negative sentiment within the coffee terminal markets is still prevalent. 

The December to January contracts arbitrage between the New York and London markets broadened yesterday; to register this at 46.67 usc/Lb.  This equates to 43.21% 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 2,170 bags yesterday; to register these stocks at 2,227,087 bags, with 87.3% of these certified stocks being held in Europe at a total of 1,943,375 bags and the remaining 12.7% being held in the USA at a total of 283,712 bags.  There was a smaller in number decrease to the number of bags pending grade to this exchange, by 914 bags; to register these pending grading stocks at 10,596 bags. 

The Certified Robusta coffee stocks held against the London exchange have been reported to decrease by 13,667 bags over the weeks of trade leading up to Monday 4th November, to see these stocks registered at 2,629,167 bags, on the day. 

The commodity markets were mixed mostly softer in trade yesterday, to see overall macro commodity index taking a soft sideways track for the day. The Coffee, Wheat, Gold and Silver markets ended the day on a positive note, while the Oil, Natural Gas, Sugar, Cocoa, Cotton, Copper, Orange Juice, Corn and Soybean markets ended the day on a softer note.  The Reuters Equal Weight Continuous Commodity Index that is related to 17 markets is 0.549 % lower; to see this index registered at 407.168.   The day starts with the U.S. Dollar steady, trading at 1.285 to Sterling, at 1.106 to the Euro and with the US Dollar buying 4.083 Brazilian Real. 

The London and New York markets started the day yesterday trading on a modest positive note, both markets retained this positive stance into the early afternoon trade. As the afternoon progressed Both the London and the New York markets started to gain late in the day support to move into positive territory and accentuate the gains for the day, settling near the highs of the day at the close. 

The London market ended the day on a positive note, and with 68.4% of the earlier gains of the day intact, while the New York market ended the day on a likewise positive note, and with 91.6% of the earlier gains of the day intact. This steady close for the markets is likely to inspire confidence and on would expect to see 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.                                                

NOV   1316 + 13                                                          DEC    108.00 + 2.20  

JAN    1352 + 13                                                          MAR   111.55 + 2.10  

MAR   1372 + 16                                                          MAY   113.80 + 2.15

MAY   1390 + 16                                                          JUL    115.90 + 2.15

JUL    1410 + 16                                                          SEP    117.70 + 2.05

SEP    1431 + 15                                                          DEC   120.20 + 2.00

NOV   1451 + 13                                                          MAR   122.75 + 1.95

JAN    1473 + 13                                                          MAY   124.35 + 1.90

MAR   1497 + 12                                                          JUL    125.90 + 1.85