Coffee Market Report November 12 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 30.31% over the week of trade leading up to Tuesday 5th November; to register a new net short sold position of 40,715 Lots.  Meanwhile the longer term in nature Index Fund sector of this market increased their net long position within the market by 14.6%, to register a net long position of 50,000 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 15.04%; to register a new net short sold position of 58,415 Lots. This net short-sold position which is the equivalent of 16,560,394 bags has most likely been further decreased, following the period of mixed but overall firmer 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 narrowed yesterday; to register this at 43.63 usc/Lb.  This equates to 41.16% 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 462 bags yesterday; to register these stocks at 2,224,799 bags, with 87.2% of these certified stocks being held in Europe at a total of 1,940,258 bags and the remaining 12.8% being held in the USA at a total of 284,541 bags.  There was a larger in number decrease to the number of bags pending grade to this exchange, by 2,475 bags; to register these pending grading stocks at 8,121 bags. 

The commodity markets were softer in trade yesterday, to see overall macro commodity index taking a negative track for the day. The Cocoa market ended the day on a positive note, the Sugar market remained unchanged for the day, while the Oil, Natural Gas, Coffee, Cotton, Copper, 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 0.9201 % lower; to see this index registered at 402.3602.   The day starts with the U.S. Dollar steady, trading at 1.286 to Sterling, at 1.103 to the Euro and with the US Dollar buying 4.153 Brazilian Real. 

The London and New York markets started the day yesterday trading on a modest soft note, The New York market started to attract selling pressure to accentuate the losses for the early afternoon trade, while the London market maintained its modest soft stance into the early afternoon trade. As the afternoon progressed the New York market continued on its negative track to close near the lows for the day, while the London market followed suit in a more sedate manner.

The London market ended the day on a negative note, and with 75% of the earlier losses of the day intact, while the New York market ended the day on a very negative note, and with 87.3% of the earlier losses of the day intact. This close is unlikely to inspire confidence and one would think the markets are due little better than a cautious and hesitant start for early trade today, against the prices set yesterday, as follows:   

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

NOV   1338 – 16                                                           DEC    106.00 – 3.45  

JAN    1375 – 9                                                             MAR   109.45 – 3.40  

MAR   1395 – 11                                                           MAY   111.75 – 3.45

MAY   1414 – 12                                                           JUL    113.95 – 3.45

JUL    1434 – 12                                                           SEP    115.95 – 3.35

SEP    1453 – 12                                                           DEC   118.35 – 3.20

NOV   1472 – 12                                                           MAR   120.80 – 3.10

JAN    1492 – 12                                                           MAY   122.45 – 3.00

MAR   1516 – 12                                                           JUL    124.05 – 2.95