Coffee Market Report

by | 11 Feb 2021

The March 2021 to March 2021 contract arbitrage between the London and New York markets narrowed yesterday: to register this at 59.91 usc/Lb. This equates to 49.47% 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 25,401 bags yesterday, to register these stocks at 1,688,231 bags, with 94.90% of these certified stocks being held in Europe at a total of 1,602,670 bags and the remaining 5.10% being held in the USA at a total 85,561 bags.  There was meanwhile a smaller in number 8,084 bags increase to the number of bags pending grading for this exchange; to register these pending grading stocks at 107,113 bags. The Certified Washed Arabica Coffee stocks held against the New York exchange were seen to reach a 8 month high yesterday, this could be seen to dampen speculative sentiment within the market.

It was a firmer day overall on the commodity markets yesterday, to see the overall macro commodity index taking firm something of a sideways track for the day. The Sugar, Cocoa and London Robusta Coffee markets ended the day on a positive note, while the New York Arabica Coffee Market ended the day on a softer note. The Reuters Equal Weight Continuous Commodity Index that is related to 17 markets is 0.07% lower; to see this index registered 487.20.  The day starts with the U.S. Dollar, trading at 1.385 Sterling, at 1.213 the Euro and with the US Dollar buying 5.386 Real.

The New York and London markets started the day yesterday trading on a modest firmer note, both markets continued to trade around par for the remainder of the morning session. As the afternoon progressed the New York market started to attract selling pressure which saw the market set on a softer path for the remainder of the day’s trade, the market briefly recovered although this support was short lived and the market was seen to settle lower at the close. The London market dropped back late in the day however the market bounced off the lows of the day to see settle on a modest firmer note for the day.

The London market ended the day on a modest positive note with 58.33% of the earlier gains of the day intact, while the New York market ended the day on a likewise modest negative note with 68.52% of the earlier losses of the day intact. This mixed close, does little to indicate direction and one might think that the markets are due for little better than a hesitant start to early trade today, against the prices set yesterday, as follows:  

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

MAR    1349 + 7                                     MAR    121.10 – 1.85

MAY     1374 + 9                                     MAY     123.15 – 1.85

JUL      1387 + 7                                     JUL     125.10 – 1.85

SEP     1403 + 8                                    SEP     126.90 – 1.90

NOV     1420 + 8                                     DEC     129.00 – 1.85

JAN     1434 + 7                                     MAR    130.65 – 1.85

MAR    1451 + 7                                     MAY    131.35 – 1.90

MAY     1467 + 7                                     JUL        131.85 – 1.85