Coffee Market Report
| The National Coffee Council in El Salvador have announced that the country’s coffee exports for the month of September were 2,108 bags or 22.5% higher than the same month last year, at a total of 11,475 bags. This improved performance has contributed to the countries cumulative exports for the just completed October 2014 to September 2015 coffee year to have been 98,663 bags or 19.77% higher than the previous coffee year, at a total of 597,683 bags.
So far and with the new crop developing the early forecasts are for little change from the past crop at approximately 800,000 bags, which would tend to indicate that El Salvador shall be looking to a similar export performance for this new October 2015 to September 2016 coffee year. This being out of sync with their neighbours in Mexico and Central America, where the focus is upon rising supply from the new late October to March harvest. The Uganda Coffee Development Authority has reported that the country’s coffee exports for the month of September were 78,399 bags or 37.71% higher than the same month last year, at a total of 286,322 bags. This improved performance does however follow some months of relatively modest export volumes and the countries cumulative coffee exports for the just completed October 2014 to September 2015 coffee year are still 43,977 bags or 1.26% lower than the previous coffee year, at a total of 3,455,852 bags. In terms of value however the Ugandan coffee exports for the just completed October 2014 to September 2015 coffee year are still US$ 16,641,786.00 or 4.22% higher than the previous coffee year, at a total of US$ 410,564,121.00. This is even more impressive in terms of the U.S. dollar now earning over 25% more Uganda Shillings than it did at the end of the last coffee year, which means that in terms of domestic currency the country’s coffee farmers are still in receipt of a much improved income in domestic currency for their marginally lower sales volumes during the present coffee year. There has been no further striking news in terms of the pending new cold front and rains for the main Brazil coffee districts in South East Brazil, with this weather factor having little impact upon sentiment with the markets yesterday. Thus most players await with anticipation the weather news from Brazil that shall come to the fore post this coming weekend, as if the prospects of rain prove to be disappointing it shall most certainly start to raise fears of potential damage to the prospects of the next 2016 Brazil crop. A crop that has be close to 60 million bags, if the country is to start to rebuild its stocks that shall be mostly liquidated by the start of the new crop. The second month arbitrage between the markets broadened yesterday, to register this at 56.21 usc/Lb., while this equates to a 43.88% price discount for the London robusta coffee market. This arbitrage remaining relatively attractive to roasters in comparison to arabica coffee prices, but is perhaps due to widen further in time and when Vietnam stocks start to impact in more volume upon the fortunes of the London market. The Certified washed Arabica coffee stocks held against the New York exchange were seen to increase by 5,205 bags yesterday; to register these stocks at 1,896,589 bags. There was meanwhile a larger in volume 5,629 bags decrease to the number of bags pending grading for this exchange; to register these pending grading stocks at 61,284 bags. The Certified Robusta coffee stocks held against the London exchange were seen to decrease by 1,000 bags on Monday 19th. October; to register these stocks at 3,400,500 bags on the day. The commodity markets were mixed and lacklustre in trade yesterday, but with the overall macro commodity index showing a degree of modest buoyancy for the day. The Natural Gas, Cocoa, New York arabica Coffee, Cotton, Wheat, Corn, Soybean, Gold, Silver and Platinum markets had a day of buoyancy, while the Oil, Sugar, London robusta Coffee, Copper and Orange Juice markets had a softer day’s trade. The Reuters Equal Weight Continuous Commodity Index that is made up from 17 markets is 0.29% higher to see this Index registered at 405.48. The day starts with the U.S. Dollar steady and trading at 1.544 to Sterling and 1.138 to the Euro, while North Sea Oil is steady in early trade and is selling at 46.80 per barrel. The London market started the day yesterday on a steady note, while the New York market came under immediate follow through negative pressure, which very quickly had its influence within the London market that slipped back into negative territory and with both markets entering the afternoon trade on a negative track. The New York market did however recover as the afternoon progressed and took a move back into positive territory, while the London market continued to remain a negative track. The New York market did however shed it gains and slip back into negative territory before recovering and taking an erratic and unconvincing positive track towards the close and while the London market remained on its soft track, through to the close. The London market ended the day on a soft note and with 53.6% of the losses of the day intact, while the New York market that might have perhaps gained some degree of support from the positive nature of the macro commodity index, ended the day on a modestly positive note and with 55.2% of the earlier gains of the day intact. This was an unconvincing close and one that does not inspire much in the way of confidence and one might expect little better than a steady start for early trade today against the prices set yesterday, as follows: LONDON ROBUSTA US$/MT NEW YORK ARABICA USc/Lb. NOV 1557 – 25 DEC 124.75 + 0.85 |
