Coffee Market Report March 10 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 turn their net short position within the market to a net long position  over the week of trade leading up to Tuesday 3rd.March; to register a new net long position of 172 Lots.  Meanwhile the longer term in nature Index Fund sector of this market increased their net long position within the market by 6.5%, to register a net long position of 50,861 Lots on the day. 

Over the same week, the Non-Commercial Speculative sector of this market decreased their net short sold position within the market by 80.1%; to register a new net short position of 3,229 Lots which is the equivalent of 915,407 bags.  This position has most likely been further decreased, following the period of mixed but overall soft sideways trade that has since followed. 

The May to May contracts arbitrage between the London and New York markets broadened yesterday; to register this at 52.64 usc/Lb.  This equates to 48.21% 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 909 bags yesterday; to register these stocks at 2,111,582 bags, with 89.8% of these certified stocks being held in Europe at a total of 1,896,115 bags and the remaining 10.2% being held in the USA at a total of 215,467 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 softer in trade yesterday, to see overall macro commodity index taking a negative track for the day. The Coffee market ended the day on a positive note, while the Cocoa and Sugar markets ended the day on a softer note.  The Reuters Equal Weight Continuous Commodity Index that is related to 17 markets is 3.6499% lower; to see this index registered at 365.4378.   The day starts with the U.S. Dollar steady, trading at 1.305 to Sterling, at 1.136 to the Euro and with the US Dollar buying 4.723 Brazilian Real. 

The London and New York markets started the day yesterday trading on a very negative note, both markets continued on this negative track into the early afternoon trade. As the afternoon progressed the New York market started to attract buying support to bounce off the lows of the day and move into positive territory only to hit a ceiling and settle on a modest positive note for the day. The London market followed suit in a more sedate manner to see the market settle on a modest, near to par note for the day. 

The London market ended the day on a modest positive note and with 40% of the earlier gains of the day intact, while the New York market ended the day on a likewise positive note and with 51.4% of the earlier gains of the day intact.  This close and with the late recovery for the markets, might inspire some degree of confidence, but with the Brazil Real marginally softer again, one might not expect better than a near to steady start for early trade today, against the prices set yesterday, as follows:   

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

MAY   1247 + 2                                                                         MAY  109.20 + 1.80

JUL    1262 – 2                                                                         JUL    111.15 + 1.85

SEP    1283 unch                                                                     SEP   113.10 + 1.85

NOV   1303 + 1                                                                         DEC   115.55 + 1.80

JAN    1322 + 2                                                                         MAR  117.75 + 1.75

MAR   1338 + 3                                                                         MAY  118.85 + 1.65

MAY   1358 + 4                                                                         JUL    119.85 + 1.65

JUL    1380 + 6                                                                         SEP    120.85 + 1.65