Coffee Market Report February 11 2020

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 long position within the market by 76.86% over the week of trade leading up to Tuesday 4th. February; to register a new net long position of 4,424 Lots.  Meanwhile the longer term in nature Index Fund sector of this market decreased their net long position within the market by 11.96%, to register a net long position of 49,650 Lots on the day. 

Over the same week, the Non-Commercial Speculative sector of this market turned their net long position into a net short position within the market; 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 March to March contracts arbitrage between the London and New York markets broadened yesterday; to register this at 43.11 usc/Lb.  This equates to 42.98% 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 1,802 bags yesterday; to register these stocks at 2,166,601 bags, with 89.4% of these certified stocks being held in Europe at a total of 1,937,818 bags and the remaining 10.6% being held in the USA at a total of 228,783 bags.  There was meanwhile a larger in number decrease by 4,390 bags to the number of bags pending grading for this exchange; to register these pending grading stocks at 16,875 bags. 

The commodity markets were mixed in trade yesterday, to see overall macro commodity index taking a sideways track for the day. The Sugar, New York Arabica Coffee, Cotton, Copper, Orange Juice, Soybean, Gold and Silver markets ended the day on a positive note, while the Oil, Natural Gas, Cocoa, London Robusta Coffee, Wheat and Corn markets ended the day on a softer note.    The Reuters Equal Weight Continuous Commodity Index that is related to 17 markets is 0.3159% lower; to see this index registered at 398.2352.   The day starts with the U.S. Dollar steady, trading at 1.291 to Sterling, at 1.091 to the Euro and with the US Dollar buying 4.325 Brazilian Real.

The London market started the day yesterday trading close to par on a modest negative note, while the New York market started the day yesterday trading close to par on a modest positive note, both markets maintained their respective stance into the early afternoon trade. As the afternoon progressed the New York market started to gain some buying support to move deeper into positive territory for the day and to close near to the highs of the day’s trade, while the London market maintained a modest negative track to close on a softer note for the day. 

The London market ended the day on a modest negative note and with 81.8% of the earlier losses of the day intact, while the New York market ended the day on a modest positive note and with 82.9% of the earlier gains of the day intact.  This mixed close does little to indicate direction, but with the firmer close in New York one might think the markets are due for only a hesitant steady start for early trade today, against the prices set yesterday, as follows:   

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

MAR   1261 – 9                                                                      MAR  100.30 + 1.95

MAY   1285 – 5                                                                      MAY   102.10 + 1.60

JUL    1304 – 6                                                                      JUL    104.25 + 1.55

SEP    1325 – 5                                                                      SEP    106.25 + 1.45

NOV   1346 – 4                                                                       DEC   109.00 + 1.40

JAN    1365 – 4                                                                       MAR  111.65 + 1.35

MAR   1385 – 4                                                                       MAY  113.20 + 1.35

MAY   1405 – 4                                                                       JUL    114.60 + 1.40

JUL    1426 – 5                                                                       SEP    115.85 + 1.40