Coffee Market Report April 21 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 increase their net long position within the market over the week of trade leading up to Tuesday 14th. April; to register a new net long position of 21,409 Lots.  Meanwhile the longer term in nature Index Fund sector of this market cut their net long position within the market by 0.3%, to register a net long position of 47,587 Lots on the day. 

Over the same week, the Non-Commercial Speculative sector of this market increased their net long position within this market by 12.85%, to register a new net long position of 9,819 Lots which is the equivalent of 2,783,643 bags.  This net long position has most likely been increased following the period of mixed trade but overall softer trade that since followed. 

The July to July contracts arbitrage between the London and New York markets narrowed yesterday; to register this at 61.85 usc/Lb.  This equates to 53.67% 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 7,530 bags yesterday; to register these stocks at 1,886,335 bags, with 90.6% of these certified stocks being held in Europe at a total of 1,708,753 bags and the remaining 9.4% being held in the USA at a total of 177,582 bags.  There was meanwhile a larger in number decrease by 18,161 bags to the number of bags pending grading for this exchange; to register these pending grading stocks at 21,460 bags.  

The commodity markets were very negative in trade yesterday, on the back of the US Brent Crude Oil price tumbling to their lowest point on record, to see the overall macro commodity index taking a negative track for the day. The Cocoa Sugar and Coffee Markets ended the day on a negative note. The Reuters Equal Weight Continuous Commodity Index that is related to 17 markets is 3.7384% lower; to see this index registered at 324.8960.   The day starts with the U.S. Dollar steady, trading at 1.241 to Sterling, at 1.084 to the Euro and with the US Dollar buying 5.317 Brazilian Real.     

The New York and London markets started the day yesterday trading close to par on a modest negative note, both markets continued on this sideways track into the early afternoon trade. As the afternoon progressed both the London and the New York markets briefly attracted buying support, but this support was short lived with both the London and the New York markets slipping back into negative territory to the close. 

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 82.14% of the earlier losses of the day intact. This softer close does little to inspire confidence and with the Brazil Real slipping back against the US Dollar one might expect little 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.                                                 

JUL    1177 – 11                                                                  JUL    115.25 – 2.30

SEP    1195 – 11                                                                   SEP   116.50 – 2.20 

NOV   1213 – 11                                                                   DEC   118.10 – 2.05

JAN    1231 – 10                                                                   MAR  119.55 – 2.00 

MAR   1249 – 9                                                                     MAY  120.30 – 1.95  

MAY   1266 – 9                                                  JUL   121.10 – 1.90

JUL     1283 – 9                                                                     SEP    121.90 – 1.85

SEP    1302 – 11                                                DEC  123.45 – 1.75