Coffee Market Report

by | 30 Sep 2020

The November to December contract arbitrage between the London and New York markets widened yesterday; to register this at 50.41 usc/Lb.  This equates to 46.02% 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 1,958 bags yesterday to register these stocks at 1,099,928 bags, with 93.80% of these certified stocks being held in Europe at a total of 1,031,365 bags and the remaining 6.20% being held in the USA at a total of  68,563 bags.  There was meanwhile a smaller in number 975 bags increase to the number of bags pending grading for this exchange; to register these pending grading stocks at 13,971 bags.  

The Certified Robusta coffee stocks held against the London exchange have been reported to decrease by 3,667 bags over the weeks of trade leading up to Monday 28th. September, to see these stocks registered at 1,822,333 bags, on the day.

It was a firmer day overall on the commodity markets yesterday, to see the overall macro commodity index taking something of a positive sideways track for the day. The Sugar, Cocoa and London Robusta Coffee market ended the day on a positive note, the New York Arabica Coffee Market was unchanged on the day. The Reuters Equal Weight Continuous Commodity Index that is related to 17 markets is 0.3231% higher; to see this index registered at 406.7355.   The day starts with the U.S. Dollar steady, trading at 1.284 Sterling, at 1.173 the Euro and with the US Dollar buying 5.632 Brazilian Real.

The New York and London market started the day yesterday trading on a negative note, both markets continued to trade on this softer path for the early morning session, however the morning session soon saw the London and New York markets buoyed by buying support bounce off the lows of the day to trade around par. As the afternoon progressed both the London and the New York markets continued to trade around par with the London market falling back into modest soft territory. The late afternoon session saw the New York market settle around par on a unchanged note for the day albeit there were some hefty volumes traded on the day with 21,158 Lots traded on the New York December Position, while the London market slipped back to close on negative note for the day.

The London market ended the day with on a negative note with 67.65% of the earlier losses of the day intact, while the New York market ended the day unchanged. This mixed close does little to indicate direction and with the Brazil Real showing further signs of weakness towards the US Dollar, one might think the markets are due for slightly better than a hesitant steady start to early trade, against the prices set on yesterday, as follows:  

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

NOV   1304 – 23                                                                        DEC    109.55  Unch 

JAN    1330 – 16                                                                       MAR   111.40 + 0.15 

MAR   1346 – 13                                                                       MAY   112.80 + 0.10

MAY   1362 – 12                                                                        JUL    114.20 + 0.10

JUL     1378 – 12                                                                       SEP     115.35 + 0.20 

SEP    1394 – 13                                                                       DEC    116.50 + 0.25

NOV   1411 – 13                                                                        MAR   117.65 + 0.25

JAN    1429 – 11                                                                        MAY   118.65 + 0.40