The International Coffee Organisation ICO have reported that the global coffee exports for the month of June were 6.66% lower than the same month in the previous year, at a total of 9.39 million bags. This they say, has contributed to the cumulative global coffee exports for the first nine months of the October 2022 to September 2023 coffee year to be 6.52% lower than the same period in the previous year, at a total of 84.02 million bags.

The International Coffee Organisation ICO have maintained their forecast for global coffee supply at 1.70% higher than the previous year at a total of 171.27 million bags for the October 2022 to September 2023 coffee year. The International Coffee Organisation have likewise maintained their forecast for global consumption for the October 2022 to September 2023 coffee year, to grow by 1.66% from the previous year to reach a total of 178.53 million bags. Therefore, the global coffee markets are indicated to have a coffee year deficit of 7.26 million bags heading into the October 2023 to September 2024 coffee year.

The ICO reported a decrease in exports from Brazil during June, which registered a 15.50% drop in exports when compared to the same month in the previous year, to register 2.64 million bags during June. There was a comparative increase in exports from Asia as Vietnam, India and Indonesia cumulatively registered a 0.50% decrease in exports, when compared to the same month in the previous year to total 3.63 million bags during June. Within the ICO report, exports for June were seen to have decreased by 0.60% year on year from Africa to a total 1.27 million bags.

The ICO report includes within the total global exports, the export figures, from Mexico and the traditional washed arabica Central American bloc; Costa Rica, Guatemala, Honduras, Nicaragua and El Salvador, to report for June that exports were 4.60% lower than the same period in the previous year to total 1.86 million bags.

For the most part, the largest robusta producer and exporter to consumer markets, Vietnam, is sold and limited activity within the internal market. Within the Vietnam interior meanwhile, farmers will soon start to look toward the start of the new crop harvest. So long as weather conditions remain seasonally normal and conducive, the harvest can be expected to gradually start toward the end of the rain season, traditionally around October each year. This new October 2023 to September 2024 robusta coffee crop from Vietnam is forecast to be in the region of 29.30 million bags or 3.55% larger than the current October 2022 to September 2023 coffee year.

The focus of the Coffee markets remain on Brazil at this time. The month of August, which is seasonally, the last of the winter months, weather forecasters indicate temperate weather conditions for the next fortnight, to likely dampen any residual cool weather speculative activity within the coffee terminal markets as the frost window comes to an end. Speculative focus will soon be turning once more upon the longer-term forecasts and weather prospects for the onset of the new spring and summer rain season for Brazil, to come in the last quarter of the year, to trigger the flowering for the next 2024 crop to come.

The Certified washed Arabica coffee stocks held against the New York exchange were seen to decrease by 60 bags yesterday, to register these stocks at 527,942 bags, with 98.23% of these certified stocks being held in, Europe at a total of 518,615 bags and the remaining 1.77% being held in the USA at a total 9,327. Of this, a total 159,492 bags, or 30.21% of the coffees registered and stored in consumer country certified warehouses of the exchange, Brazil washed arabica, and a further 64.93% of these certified coffees, originating from Honduras. There was meanwhile no change to the number of bags pending grading to the exchange; to register 0 bags pending grading on the day.

The September 2023 to September 2023 contract arbitrage between the London and New York markets narrowed yesterday to register this at 44.77 usc/Lb. This equates to 27.17% price discount for the London Robusta coffee market.

It was a softer day on the commodity markets yesterday, with the US Dollar gaining ground to reach a four week high against a basket of other currencies, a firmer Dollar is seen to be a bearish factor for commodities traded in other currencies. The Soybean and Palladium markets ended the day on a positive note, the Gold market remained unchanged on the day, while the Coffee, Cocoa, Corn, Wheat, Sugar, Silver and Platinum markets ended the day on a softer note. The day starts with the U.S. Dollar trading at 1.273 Sterling, at 1.095 the Euro and with the US Dollar buying 4.918 Brazil Real.

The New York market started the day yesterday trading to the south of par on a modest softer note, while the London market started the day trading to the north of par on a firmer note. The markets oscillated to either side of par for the remainder of the early morning session. The late morning session saw the New York market attract some degree of buying support to trend firmer, while the London followed suit albeit in a more sedate manner. As the afternoon progressed, the markets continued to trend in a firmer direction, before hitting a ceiling during the mid-afternoon session to limit the gains for the day. The markets dropped back from the earlier modest highs, weighed by selling in what was mainly technical trade to see the New York market drop back below par, with the London market following suit. The markets continued on a downward trajectory, accentuating the losses along the way. The selling activity started to wane toward the end of the days’ trade, to see the New York market recover some of the earlier losses of the day, while the London market narrowly recovered some of the earlier losses of the day. This saw both the New York and the London market settle in negative territory although above the lows on the day, in both markets.

The London market ended the day on a negative note with 85.29% of the earlier losses of the day intact, while the New York market ended the day on a likewise negative note with 74.58% of the earlier losses of the day intact. This softer close for the markets, does little to indicate direction with both the New York and London markets retaining most of the losses of the day, one might think that the markets are due for little better than a follow through hesitant start to trade today, against the prices set yesterday, as follows:

LONDON ROBUSTA US$/MT       NEW YORK USC/LB.

SEP     2645 – 29                              SEP     164.75 – 2.20
NOV   2516 – 16                              DEC    164.00 – 2.35
JAN    2437 – 9                                MAR   165.05 – 2.25
MAR  2399 – 6                                MAY   165.80 – 2.25
MAY  2381 – 6                                JUL     166.35 – 2.30
JUL    2367 – 8                                SEP     167.00 – 2.45
SEP    2361 – 8                                DEC    168.10 – 2.65
NOV  2358 – 8                                MAR   169.00 – 2.55