Coffee Market Report May 04 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 36.52% over the week of trade leading up to Tuesday 28th. April: to register a new net long position of 6,398 Lots which is the equivalent of 1,813,805 bags.  This net long position has most likely been largely decreased following the period of mixed but overall softer trade that since followed.  

The latest Commitment of Traders report from the London Robusta coffee market has seen the Speculative Managed Money Sector of this market increase their net short sold position within the market by 2.76% over the week of trade leading up to Tuesday 28th. April; to register a short-sold position of 34,112 Lots.  This net short sold position is the equivalent of 5,685,333 bags and has most likely been increased following the period of mixed but overall softer trade that has since followed.  

The Indonesian government trade data from Sumatra, which is the leading coffee producing island within Indonesia, has reported that the islands robusta coffee exports for the month of April were 114,078 bags or 158.21% higher than the same month last year, at a total of 186,183 bags.  This contributes to the islands cumulative robusta coffee exports for the first seven months of the present October 2019 to September 2020 coffee year to be 572,457 bags or 53.43% higher than the same period in the previous coffee year, at a total of 1,643,777 bags. 

The July to July contracts arbitrage between the London and New York markets broadened on Friday; to register this at 52.44 usc/Lb.  This equates to 48.48% 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 550 bags on Friday; to register these stocks at 1,819,813 bags, with 90.6% of these certified stocks being held in Europe at a total of 1,648,427 bags and the remaining 9.4% being held in the USA at a total of 171,386.  There was meanwhile no change to the number of bags pending grading for this exchange; to register these pending grading stocks at 25,515 bags. 

The commodity markets were marginally firmer in trade yesterday, to see the overall macro commodity index taking a positive sideways track for the day. The Sugar, London Robusta Coffee, Orange Juice and Gold markets ended the day on a positive note, While the Oil, Natural Gas, Cocoa, New York Arabica Coffee, Cotton, Copper, Wheat, Corn, Soybean and Silver markets ended the day on a softer note.  The Reuters Equal Weight Continuous Commodity Index that is related to 17 markets is 0.1434% higher; to see this index registered at 337.8994.   The day starts with the U.S. Dollar steady, trading at 1.244 to Sterling, at 1.093 to the Euro and with the US Dollar buying 5.486 Brazilian Real.     

The London and New York markets started the day trading close to par on a modest positive note, both markets maintained this firm stance into the early afternoon trade. As the afternoon progressed the London market dropped with some degree of selling pressure but only to recover and trade steadily on a positive track to close on a modest positive note, while the New York market attracted selling pressure to drop into negative territory late in the day. 

The London market ended the day on a modest positive note and with 78.56% of the earlier gains of the day intact, while the New York market ended the day on a negative note and with 0.11% of the earlier losses of the day intact. This mixed close does little to indicate direction and with the Brazil Real still trading soft to the US Dollar one might think the markets are due little better than a hesitant steady start to early trade today, against the prices set on Friday, as follows:   

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

JUL    1205 + 11                                                                 JUL    106.10 – 0.20

SEP    1226 + 11                                                                 SEP   107.25 – 0.25

NOV   1244 + 9                                                                    DEC   109.10 – 0.25

JAN    1262 + 9                                                                    MAR  111.00 – 0.30 

MAR   1279 + 9                                                                    MAY  112.25 – 0.30 

MAY   1296 + 8                                                  JUL   113.45 – 0.30

JUL     1313 + 7                                                                    SEP    114.65 – 0.30

SEP    1333 + 7                                                 DEC  116.25 – 0.30