Coffee Market Report April 13 2020

The latest Commitment of Traders report from the New York arabica market has seen the Non-Commercial Speculative sector decrease their net long position within the market by 1.60% over the week of trade leading up to Tuesday 7th. April: to register a new net long position of 8,701 Lots which is the equivalent of 2,466,695 bags.  This net long position has most likely been little changed following the period of mixed trade though toward the latter half of the week, overall firmer trade that since followed.  

The London market shall remain closed for the Easter Bank Holiday today, while the New York market shall trade for a shortened day’s trade.   Many coffee producer and consumer countries are observing a national holiday today, and one might not expect arabica producers to be very active within the New York market for the day.  

The July to July contracts arbitrage between the London and New York markets narrowed on Thursday; to register this at 64.45 usc/Lb.  This equates to 53.82% 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 42,249 bags on Thursday; to register these stocks at 1,905,211 bags, with 90.5% of these certified stocks being held in Europe at a total of 1,723,954 bags and the remaining 9.5% being held in the USA at a total of 181,257 bags.  There was meanwhile a smaller in number decrease by 3,245 bags to the number of bags pending grading for this exchange; to register these pending grading stocks at 23,186 bags. 

The commodity markets were slightly firmer in trade on Thursday, to see overall macro commodity index taking a sideways track for the day. The Sugar market ended the day on a positive note, while the Coffee and Cocoa markets ended the day on a softer note  The Reuters Equal Weight Continuous Commodity Index that is related to 17 markets is 0.3614% higher; to see this index registered at 342.8649.   The day starts with the U.S. Dollar steady, trading at 1.247 to Sterling, at 1.094 to the Euro and with the US Dollar buying 5.107 Brazilian Real.     

The London and New York Markets started the day on Thursday trading close to par on a soft note, Both the London and the New York markets maintained this soft track into the early afternoon trade. As the afternoon progressed the London market fell deeper into negative territory only to recover slightly towards the back end of trade, while the New York market saw a recovery mid trade with buying support buoying this rally but it was short lived and the New York market closed on a negative note for the day. 

The London market ended the day on a negative and with 78.6% of the earlier losses of the day intact, while the New York market ended the day on a likewise negative note and with 41.82% of the earlier losses of the day intact. This softer close for the markets is unlikely to inspire confidence and one might expect to see only a near to steady start for the New York market trading solo for the day, against the prices set on Thursday, as follows: 

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

JUL    1219 – 11                                                                    JUL    119.75 – 1.15 

SEP    1232 – 10                                                                    SEP   120.95 – 1.20 

NOV   1248 – 10                                                                    DEC   122.40 – 1.15

JAN    1266 – 9                                                                       MAR  123.60 – 1.20 

MAR   1283 – 7                                                                       MAY  124.45 – 1.25  

MAY  1299 – 6                                                    JUL   125.35 – 1.20 

JUL    1317 – 5                                                                       SEP    126.20– 1.20

SEP   1338 – 3                                                    DEC  127.60 – 1.20