Coffee Market Report

by | 12 Nov 2020

The Vietnam Customs Authority have reported that Vietnam’s coffee exports for the month of October are down by 8.4% from the previous month, to total 1,522,867 bags. This number proving to be marginally higher than the 1.50 million bags that had been initially forecast for the month’s coffee exports.  The report also states that for the first ten months of 2020, Vietnam coffee exports are 1.2% lower than the same period last year at a total of 22,333,333 bags. 

The Coffee Exporters Association in Brazil Cecafé have reported that the countries green coffee exports for the month of October were 14.41% higher than the same month last year, to total 3.8 million bags, this number made up of 3.33 million bags of Arabica Coffee up 12.36% from the same month last year and 471,793 bags of Robusta Coffee up 31.35% 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 four months of the July 2020 to June 2021 Brazil coffee year, to be 9.65% higher, overall at the end of October than the same period in the previous coffee year at a total of 13.75 million bags, this higher number of green coffee exports can be attributed to the larger biennially bearing Brazil 2020 coffee crop.

The December 2020 to January 2021 contract arbitrage between the New York and London markets widened yesterday: to register this at 45.91 usc/Lb.  This equates to 42.08% price discount for the London Robusta coffee market.  

The Certified washed Arabica coffee stocks held against the New York exchange was seen to increase by 6,747 bags yesterday, to register these stocks at 1,192,616 bags, with 93.7% of these certified stocks being held in Europe at a total of 1,117,850 bags and the remaining 6.3% being held in the USA at a total 74,766 bags.  There was meanwhile a smaller in number 4,973 bags decrease to the number of bags pending grading for this exchange; to register these pending grading stocks at 59,866 bags.  

The Certified Robusta coffee stocks held against the London exchange have been reported to increase by 100,333 bags over the weeks of trade leading up to Monday 9th. November, to see these stocks registered at 2,186,833 bags, on the day. 

It was a neutral day overall on the commodity markets yesterday, to see the overall macro commodity index taking something of a sideways track for the day. The Cocoa and Coffee markets ended the day on a positive note, while the Sugar market ended the day on a softer note.  The Reuters Equal Weight Continuous Commodity Index that is related to 17 markets is 0.2467% lower; to see this index registered 423.2636.  The day starts with the U.S. Dollar, trading at 1.319 Sterling, at 1.763 the Euro and with the US Dollar buying 5.391 Real.

The New York and London markets started the day yesterday trading to a modestly positive side of par and with both markets taking a positive track, into the early afternoon trade. As the afternoon progressed both markets started to pick up support, to add some value. The markets did though hit something of a nearby ceiling and to attract selling pressure at the highs, to limit the gains of the day.  

The London market ended the day on a positive note with 96.43% of the earlier gains of the day intact, while the New York market ended the day on a likewise positive note with 55.38% of the earlier gains of the day intact. This firmer close might inspire some degree of confidence to possibly set the markets for a hesitant steady start to early trade today, against the prices set yesterday, as follows:  

 

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

JAN   1393 + 27                                                       DEC   109.10 + 1.80

MAR   1406 + 27                                                                MAR   111.95 + 1.95

MAY   1419 + 27                                                                  MAY  113.80  + 1.95

JUL     1435 + 27                                                                 JUL    115.45  + 1.95

SEP     1452 + 27                                                                  SEP    116.95  + 1.90

NOV    1469 + 26                                                                  DEC    118.80 + 1.80

JAN     1485 + 26                                                                 MAR   120.50 + 1.75

MAR    1502 + 26                                                                   MAY     121.45 + 1.75