Coffee Market Report February 10 2020

The latest Commitment of Traders report from the New York arabica market has seen the Non-Commercial Speculative sector of this market turn their net long position within this market to a net short position over the week of trade leading up to Tuesday 4th February; to register a new net short position of 2,097 Lots which is the equivalent of 594,490 bags.  This position has most likely been further decreased, following the period of mixed but overall softer 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 11.86% over the week of trade leading up to Tuesday 4th February; to register a short-sold position of 27,270 Lots.  This net short sold position is the equivalent of 4,545,000 bags and has most likely been increased, following the period of mixed though overall softer trade that has since followed. 

The March to March contracts arbitrage between the London and New York markets broadened on Friday; to register this at 40.74 usc/Lb.  This equates to 41.42 % price discount for the London Robusta coffee market.   

The Certified washed Arabica coffee stocks held against the New York exchange were seen remain unchanged on Friday; to register these stocks at 2,166,185 bags, with 89.4% of these certified stocks being held in Europe at a total of 1,935,633 bags and the remaining 10.6% being held in the USA at a total of 230,552 bags.  There was meanwhile no change to the number of bags pending grading for this exchange; to register these pending grading stocks at 21,265 bags. 

The commodity markets were mixed in trade on Friday, to see overall macro commodity index taking a sideways track for the day. The Sugar, Cocoa, New York Arabica Coffee, Orange Juice, Wheat, Corn, Soybean and Gold markets ended the day on a positive note, while the Oil, Natural Gas, London Robusta Coffee, Cotton, Copper and Silver markets ended the day on a softer note.    The Reuters Equal Weight Continuous Commodity Index that is related to 17 markets is 0.0559% higher; to see this index registered at 399.4970   The day starts with the U.S. Dollar showing steady, trading at 1.291 to Sterling, at 1.096 to the Euro and with the US Dollar buying 4.321 Brazilian Real. 

The London and New York markets started the day on Friday trading on close to par on a modest positive note, both markets encountered buying support to move deeper into positive territory into the early afternoon trade. As the afternoon progressed both the London and the New York started to attract selling pressure to drop back of the highs of the day’s trade and move into modest positive territory, the London market fell back to trade in modest negative territory for the remainder of the day and to close near to the lows of the days trade while the New York market closed on a modest positive note for the day. 

The London market ended the day on a modest negative note and with 73.3% of the earlier losses of the day intact, while the New York market ended the day on a modest positive note and with 11.4% of the earlier gains of the day intact.  This mixed close does little to indicate direction but with a marginally softer Brazil Real in play on might think the markets are due only a hesitant steady start for early trade today, against the prices set on Friday, as follows:  

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

MAR   1270 – 11                                                                     MAR    98.15 + 0.20

MAY   1290 – 7                                                                       MAY  100.35 + 0.15

JUL    1310 – 6                                                                       JUL    102.55 + 0.15

SEP    1330 – 6                                                                      SEP    104.70 + 0.10

NOV   1350 – 6                                                                       DEC   107.50 + 0.10

JAN    1369 – 6                                                                       MAR  110.35 – 0.05

MAR   1389 – 6                                                                       MAY  111.90 – 0.05

MAY   1409 – 7                                                                       JUL    113.30 – 0.10

JUL    1431 – 8                                                                       SEP    114.50 – 0.05