Coffee Market Report March 05 2020

The Brazil government have reported that the country’s coffee exports for the month of February were 282,300 bags or 9.13% lower than the same month last year, at a total of 2,810,200 bags. The large decrease in reported exports for this month due to the larger biennial bearing production in 2018 coffee year, to similarly reflect the increased exports of Conilon robustas, to consumer markets over the same month in the previous year. 

The National Coffee Growers Federation in Colombia have reported that the country’s coffee production for the month of February was 105,000 bags or 9.49% lower than the same month last year, at a total of 1,001,000 bags.   This has contributed to the countries cumulative production for the first five months of the present October 2019 to September 2020 coffee year to be 535,000 bags or 8.81% higher than the same period in the previous coffee year, at a total of 6,606,000 bags. 

The National Coffee Growers Federation in Colombia have also reported that the country’s coffee exports for the month of February were 167,000 bags or 13.4% lower than the same month last year, at a total of 1,079,000 bags.   This has contributed to the country’s cumulative coffee exports for the first five months of the present October 2019 to September 2020 coffee year to be 150,000 bags or 2.45% lower than the same period in the previous coffee year, at a total of 5,596,000 bags. 

The May to May contracts arbitrage between the London and New York markets narrowed yesterday; to register this at 59.12 usc/Lb.  This equates to 49.95% 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 8,069 bags yesterday; to register these stocks at 2,119,664 bags, with 89.8% of these certified stocks being held in Europe at a total of 1,903,447 bags and the remaining 10.2% being held in the USA at a total of 216,217 bags.  There was meanwhile no change to the number of bags pending grading for this exchange; to register these pending grading stocks at 0 bags. 

The commodity markets were mixed in trade yesterday, to see overall macro commodity index taking a sideways track for the day. The Cocoa, Coffee and Sugar markets ended the day on a softer note.  The Reuters Equal Weight Continuous Commodity Index that is related to 17 markets is 0.1217% lower; to see this index registered at 390.2521.   The day starts with the U.S. Dollar steady, trading at 1.288 to Sterling, at 1.113 to the Euro and with the US Dollar buying 4.585 Brazilian Real. 

The London and New York markets started the day yesterday trading on a negative note, both markets continued on this soft track into the early afternoon trade. As the afternoon progressed the New York market started to attract selling pressure to move deeper into negative territory only to recover slightly and bounce back off the lows of the day and close on a negative note, while the London market followed suit in a more sedate manner to also close on a negative note for the day. 

The London market ended the day on a negative note and with 77.4% of the earlier losses of the day intact, while the New York market ended the day on a likewise negative note and with 71.7% of the earlier losses of the day intact.  This softer close for the markets is unlikely to inspire confidence and with a marginally weaker Brazil Real in play, one might not expect much better than a hesitant steady start to early trade today, against the prices set yesterday, as follows:   

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

MAR   1285 – 20                                                                         MAR  117.15 – 3.90

MAY   1307 – 24                                                                         MAY  118.40 – 3.80

JUL    1323 – 23                                                                         JUL    120.40 – 3.80

SEP    1340 – 22                                                                         SEP   122.35 – 3.70

NOV   1356 – 22                                                                         DEC   124.60 – 3.70

JAN    1371 – 23                                                                         MAR  126.70 – 3.70

MAR   1386 – 23                                                                         MAY  127.80 – 3.80

MAY   1405 – 23                                                                         JUL    128.80 – 3.90

JUL    1426 – 23                                                                         SEP    129.80 – 3.95