Coffee Market Report
The late summer rains continue as usual over the main central highland’s coffee districts in Vietnam, heavy rains in this area had caused partial flooding earlier this month in some areas, although this did not damage any coffee trees. With farmers and internal traders having sold most of the past coffee crop, internal prices remain firm with strong internal market price resistance for sales of the remaining unsold coffee stocks. This firm market sentiment within Vietnam may be anticipated to remain unchanged at least until Mid-November when Vietnam’s October 2019 to September 2020 coffee crop harvest will be in full swing.
The Green Coffee Association of the U.S.A. have announced that the countries port warehouse stocks increased by 279,052 bags or 4,09% during the month of July, to register these stocks at 7,099,175 bags at the end of the month. The overall Green Coffee stocks reported, do not include the in-transit bulk container coffees or the onsite roaster inventories, which with an approximate combined U.S.A. and Canadian weekly consumption that is supported by these stocks of approximately 595,000 bags per week, would conservatively have been at least 1.2 million bags.
The November to December contracts arbitrage between the London and New York markets narrowed yesterday; to register this at 36.58 usc/Lb. This equates to 37.33% price discount for the London Robusta coffee market.
The Certified washed Arabica coffee stocks held against the New York exchange were seen to increase by 2,142 bags yesterday; to register these stocks at 2,366,091 bags. There was meanwhile a larger in number decrease by 5,321 bags to the number of bags pending grading for this exchange; to register these pending grading stocks at 17,327 bags.
The commodity markets were mixed in trade yesterday, to see the overall macro commodity index taking something of a sideways track for the day. The Natural Gas, Sugar, Coffee, Cotton, Corn and Gold markets ended the day on a positive note and the Copper market was near to steady for the day, while the Oil, Cocoa, Orange Juice, Wheat, Soybean and Silver markets ended the day on a softer note. The Reuters Equal Weight Continuous Commodity Index that is related to 17 markets is 0.57% lower; to see this index registered at 378.21. The day starts with the U.S. Dollar steady and trading at 1.210 to Sterling, at 1.110 to the Euro and with the US Dollar buying 3.991 Brazilian Real.
The London and New York markets started the day trading either side of par, to see both markets retain this stance into the early afternoon trading on a modest positive note. As the afternoon progressed both markets continued to attract support to trade in positive territory, however both markets fell back from the highs of the day to trade marginally north of par.
The London market ended the day on a modest positive note and with 84.2% of the earlier gains of the day intact, while the New York market ended the day on a likewise modest positive note and with 8.7% of the earlier gains of the day intact. This close and with the Brazil Real showing signs of buoyancy one would expect a near to steady start due for early trade today, against the prices set yesterday, as follows:
LONDON ROBUSTA US$/MT NEW YORK ARABICA USc/Lb.
SEP 1324 + 15 SEP 94.55 + 0.10
NOV 1354 + 16 DEC 98.00 + 0.10
JAN 1378 + 17 MAR 101.50 Unch
MAR 1404 + 14 MAY 103.85 + 0.05
MAY 1429 + 12 JUL 106.05 + 0.05
JUL 1449 + 11 SEP 108.10 + 0.05
SEP 1471 + 11 DEC 111.10 Unch
NOV 1497 + 13 MAR 114.05 – 0.05
JAN 1520 + 13 MAY 116.10 – 0.10
MAR 1542 + 13 JUL 118.00 – 0.20
