Coffee Market Report January 31 2017

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 increase their net long position within the market by 16.14% over the week of trade leading up to Tuesday 24th. January; to register a net long position of 25,741 Lots.   Meanwhile the longer term in nature Index Fund sector of this market increased their net long position within the market by 0.98%, to register a net long position of 35,059 Lots on the day.
Over the same week, the Non-Commercial Speculative sector of this market increased their long position within the market by 34.45%, to register net long position of 25,281 Lots.   This net long position which is the equivalent of 7,167,051 bags has most likely been further increased, following the period of mixed but overall more positive trade which has since followed and likewise, that of the Managed Money fund sector of the market.
The latest Commitment of Traders report from the London robusta coffee market has seen the Speculative Non-Commercial sector of this market increase their net long position within this market by 1.81% during the week of trade leading up to Tuesday 24th. January; to register a record high net long position of 47,058 Lots.  This net long position which is the equivalent of 7,843,000 bags has most likely been increased further, following the period of mixed but overall more positive trade that has since followed.
The May to May contracts arbitrage between the London and New York markets narrowed yesterday, to register this at 51.64 usc/Lb., while this equates to 33.59% price discount for the London robusta coffee market.  This relatively narrow arbitrage is now becoming less of an attractive factor for the roasters who have considered robusta coffees to be an opportunist discount component, within their mostly arabica coffee blends.
The Certified washed Arabica coffee stocks held against the New York exchange were seen to increase by 3,340 bags yesterday; to register these stocks at 1,291,366 bags.  The certified stocks reported an increase of 4,818 bags to the number of bags pending grading for this exchange; to register these pending grading stocks at 42,166 bags.
The commodity markets had a mixed day yesterday, as the energy markets posted another negative day as while the U.S. Dollar lost ground against other major currencies on the day and the traditional safe haven Gold markets posted a positive day.  The U.S. Federal Reserve meetings begin today with announcements following the meetings anticipated tomorrow.  Apart from the precious metals; Gold, Silver, Platinum, Palladium and Orange Juice, the rest of the board finished on a negative note. The Reuters Equal Weight Continuous Commodity Index that is made up from 17 markets is 0.66% lower, to see this Index registered at 427.78.   The day starts with the U.S. Dollar near to steady and trading at 1.251 to Sterling and 1.07 to the Euro, while North Sea Oil is softer in early trade and is selling at $ 54.40 per barrel.
 
The London and New York markets started the day yesterday on a softer note in both markets, which continued into the early afternoon session.  There was a relatively low volume of trade in London as the main robusta producer markets remained closed for Tet New Year celebrations in Vietnam and the lack of producer sellers seemingly assisting this market to recovery lost ground toward the latter half of the day although moves toward positive were met with sellers waiting at the top of the day to cap the day.  This market set the close, hardly changed on the day. The New York market reflected a degree of volatility brought about by the news of better rain dispersion across the arabica growing areas in Brazil, while macro influence upon the market of the weaker U.S. Dollar assisted perhaps, to set the floor and a recovery toward the latter half of the session but still in negative territory, near to the middle of the day’s trading range in this market, to set the close yesterday, hardly changed in London but on a steady note, and a steady to softer note in New York, as follows:
LONDON ROBUSTA US$/MT                          NEW YORK ARABICA USc/Lb.
JAN      2252 – 1   
MAR     2237 – 1                                                MAR   151.15 – 1.25
MAY     2250 Unch                                            MAY   153.70 – 1.20
JUL      2257 + 1                                                JUL     156.05 – 1.15
SEP      2261 + 1                                                SEP    158.30 – 1.15
NOV     2263 + 2                                                DEC    161.40 – 1.15
JAN      2262 + 3                                                MAR   164.30 – 1.15
MAR     2260 + 2                                                MAY   165.95 – 1.15
MAY     2262 + 2                                                JUL    167.50 – 1.10
JUL      2272 + 2                                                SEP    168.90 – 1.20