Coffee Market Report

by | 15 Sep 2021

The Coffee Exporters Association in Brazil Cecafé have reported that the countries green coffee exports for the month of August were 27.92% lower than the same month last year, to total 2.34 million bags, this number made up of 2.10 million bags of arabica coffee down 23.80% from the same month last year and 228,460 bags of Conilon robusta coffee down 51.88% from the same month last year. 

The Coffee Exporters Association in Brazil Cecafé have since reported the cumulative exports of green coffee for the first two months of the current July 2021 to June 2022 Brazil coffee year, to be 19.83% lower, overall, than the previous coffee year at a total of 4.90 million bags. 

The November-to-December contract arbitrage between the London and New York markets narrowed yesterday to register this at 91.87 usc/Lb. This equates to 49.54% price discount for the London Robusta coffee market.  This wide arbitrage will likely be viewed by price sensitive roasters as an attractive alternative discount for robusta against the comparatively higher value arabica coffee.

The Certified washed Arabica coffee stocks held against the New York exchange were seen to decrease by 250 bags yesterday, to register these stocks at 2,161,497 bags, with 94.26% of these certified stocks being held in Europe at a total of 2,037,588 bags and the remaining 5.74% being held in the USA at a total 123,909 bags.  Of this, a total 1,152,510 bags, or 53.31% of the coffees registered and stored in consumer country certified warehouses of the exchange, Brazil washed arabica, and a further 39.18% of these certified coffees, originating from Honduras.  There was meanwhile no change to the number of bags pending grading to the exchange; to register these at 3,200 bags grading stocks. 

The Certified Robusta coffee stocks held against the London exchange have been reported to decrease by 64,167 bags over the week of trade leading up to Monday 13th. September to see these stocks registered at 2,217,667 bags, on the day. 

It was a mixed day on the commodity markets yesterday, as slower than expected inflation data was released in the USA, which saw the US Dollar retreat to some degree. The Sugar, Cocoa, London Robusta Coffee, Wheat, Corn, Gold and Silver markets ended the day on a positive note, while the New York Arabica Coffee, Soybean, Platinum and Palladium markets ended the day on a softer note.  The day starts with the U.S. Dollar trading at 1.380 Sterling, at 1.180 the Euro and with the US Dollar buying 5.240 Brazil Real.  

The New York and London markets started the day yesterday trading on a modest close to par softer note. The markets continued to oscillate around par before gaining some support to trend firmer for the remainder of the morning session.  The markets would soon hit a ceiling for the day limiting the gains to see the markets drop back and set on a softer path for the remainder of the session.  The markets rebounded from the lows of the day to recover some of the earlier in the day losses late in the day, to see the New York market settle on a negative note at the close, while the London market settled on a modest close to par firmer note at the close.  

The London market ended the day yesterday on a modest close to par positive note and with 40% of the gains of the day intact, while the New York market ended the day yesterday on a negative note and with 32.95% of the losses of the day intact. This mixed but mostly softer close does little to inspire confidence, nor does it 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 USC/LB.                                                                                                                 

NOV     2063 + 6                                                  DEC     185.45 – 1.35

JAN      2047 + 5                                                  MAR     188.20 – 1.35

MAR    1994 + 1                                                  MAY     189.35 – 1.30

MAY     1973 Unch                                                JUL      190.15 – 1.30

JUL      1965 – 1                                                  SEP     190.70 – 1.30

SEP      1964 – 1                                                  DEC     191.35 – 1.35

NOV     1968 – 1                                                  MAR    192.00 – 1.25

JAN     1975 – 1                                                  MAY     192.50 – 1.15