The November 2022 to December 2022 contract arbitrage between the London and New York narrowed yesterday to register this at 113.70 usc/Lb. This equates to 52.92% price discount for the London Robusta coffee market. This wide arbitrage may 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 9,760 bags yesterday, to register these stocks at 575,455 bags, with 90.04% of these certified stocks being held in Europe at a total of 518,158 bags and the remaining 9.96% being held in the USA at a total 57,297. Of this, a total 354,347 bags, or 61.58% of the coffees registered and stored in consumer country certified warehouses of the exchange, Brazil washed arabica, and a further 27.79% of these certified coffees, originating from Honduras. There were meanwhile a 1,610 bags decrease to the number of bags pending grading to the exchange; to register 3,120 bags pending grading on the day.

It was a mixed but overall softer day on the on the commodity markets yesterday, with the expectations of further interest rate hikes to come after the US Federal Reserve September Policy meetings weighing on the market. The Wheat, Silver, Platinum and Palladium markets ended the day on a positive note, while the Coffee, Cocoa, Corn, Sugar, Soybean and Gold markets ended the day on a softer note. The day starts with the U.S. Dollar trading at 1.151 Sterling, at 0.996 the Euro and with the US Dollar buying 5.164 Brazil Real.

The New York and London markets started the day yesterday trading on a modest near to par firmer note, the markets attracted a degree of selling pressure which saw both the New York and the London markets trend in a softer direction. The mid-morning session saw the markets briefly recover the early losses to trend back towards par, this was however short lived. As the afternoon progressed, both the New York and the London markets would be pressured by the late morning resistance to drop back from the modest highs of the morning and see the market trend in a softer direction for the remainder of the day. The late afternoon session saw some degree of long liquidation pressure on the markets to push both the New York and the London markets lower. The New York market was seen to settle on a softer note, near to the lows of the day at the close, while the London market recovered some of the earlier losses to settle on a modest softer note at the close.

The London market ended the day on a negative note with 56.25% of the earlier losses of the day intact, while the New York market ended the day on a likewise negative note with 87.97% of the earlier losses of the day intact. This follow through softer close for the markets, does little to indicate direction, with the New York market settling near to the lows of the day, on 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  2230 – 9                                        DEC 214.85 – 5.85
JAN 2219 – 11                                        MAR 210.15 – 5.30
MAR 2193 – 13                                      MAY 206.85 – 5.15
MAY 2181 – 14                                      JUL 204.05 – 5.15
JUL 2171 – 14                                        SEP 201.70 – 5.30
SEP 2162 – 14                                        DEC 199.60 – 5.35
NOV 2150 – 14                                      MAR 197.85 – 5.30
JAN 2145 – 14                                       MAY 196.95 – 5.00