I. & M. Smith (Pty) Ltd. since 1915
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I. & M. Smith (Pty) Ltd.

Coffee Market Report

26 Feb 2021

The Ugandan Coffee Development Authority UCDA have reported that their country’s coffee exports for the month of January were 23,103 bags or 4.92% lower than the same month last year, at a total of 446,550 bags. Uganda Robusta exports registered a 5.65% increase in exports when compared to the same month last year, to total 398,160 bags, whereas Arabica exports registered a decrease by 47.84% to a total 48,400 bags exported in January this year. The UCDA likewise report that the cumulative exports for the first four months of the October 2020 to September 2021 coffee year are 109,090 bags or 6.74% higher than the same period in the previous year, at a total of 1,727,437 bags.

The May-to-May contract arbitrage between the London and New York markets widened yesterday: to register this at 73.10 usc/Lb. This equates to 52.19% 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 2,059 bags yesterday, to register these stocks at 1,762,415 bags, with 94.5% of these certified stocks being held in Europe at a total of 1,665,385 bags and the remaining 5.5% being held in the USA at a total 97,030 bags. There was meanwhile a larger in number 11,210 bags increase to the number of bags pending grading for this exchange; to register these pending grading stocks at 94,544 bags.

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 0.80% lower; to see this index registered 507.09. The day starts with the U.S. Dollar, trading at 1.397 Sterling, at 1.216 the Euro and with the US Dollar buying 5.531 Real.

The New York and London markets started the day yesterday trading close to par on a modest softer note, both markets quickly gained momentum in the early afternoon session to see the markets trend firmer for the morning. As the afternoon progressed the New York market buoyed by buying support rallied firmer only to hit a ceiling and drop back from the highs of the early afternoon session, the market continued to trade on a modest firmer note before gaining momentum late in the day to see the market settle near to the highs of the day. The London market followed suit albeit in a more sedate manner to also see the market settle near to the highs of the day.

The London market ended the day on a modest positive note with 81.25% of the earlier gains of the day intact, while the New York market ended the day on a likewise positive note with 87.50% of the earlier gains of the day intact. This firmer close, and with both markets settling near to the highs of the day one might think that the markets are due for a steady start for early trade today, against the prices set yesterday, as follows:

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

MAR 1459 + 12                                        MAR 139.20 + 3.55
MAY 1476 + 13                                         MAY 140.05 + 2.80
JUL 1495 + 13                                           JUL 141.85 + 2.80
SEP 1510 + 13                                           SEP 143.50 + 2.75
NOV 1524 + 14                                         DEC 144.90 + 2.65
JAN 1537 + 14                                          MAR 145.90 + 2.60
MAR 1553 + 14                                        MAY 146.30 + 2.55
MAY 1569 + 14                                        JUL 146.70 + 2.60