Coffee Market Report

The November to December contract arbitrage between the London and New York markets narrowed yesterday; to register this at 49.30 usc/Lb. This equates to 44.62% 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 1,100 bags yesterday to register these stocks at 1,104,688 bags, with 93.70% of these certified stocks being held in Europe at a total of 1,035,300 bags and the remaining 6.30% being held in the USA at a total of 69,388 bags. There was meanwhile a larger in number 1,925 bags increase to the number of bags pending grading for this exchange; to register these pending grading stocks at 7,686 bags.

The Certified Robusta coffee stocks held against the London exchange have been reported to decrease by 7,500 bags over the weeks of trade leading up to Monday 21st. September, to see these stocks registered at 1,826,000 bags, on the day.

It was a softer day overall on the commodity markets yesterday, to see the overall macro commodity index taking something of a soft sideways track for the day. The Cocoa and London Robusta Coffee markets ended the day on a positive note, while The Sugar and New York Arabica Coffee markets ended the day on a softer note. The Reuters Equal Weight Continuous Commodity Index that is related to 17 markets is 0.5970% lower; to see this index registered at 403.5416. The day starts with the U.S. Dollar steady, trading at 1.270 Sterling, at 1.166 the Euro and with the US Dollar buying 5.593 Brazilian Real.

The London and New York markets started the day yesterday trading on a modest softer note, both markets soon attracted a degree of buying support to see the markets trend positive for the early morning session. As the afternoon progressed the markets oscillated around par before attracting a degree of selling pressure in the afternoon session, this was short lived as the New York market bounced off the lows of the day to settle on a modest negative note while the London market settled on a modest close to par positive note for the day.

The London market ended the day with on a modest positive note with 50% of the earlier gains of the day intact, while the New York market ended the day on a modest negative note with 9.67% of the earlier losses of the day intact. This mixed close does little to indicate direction, albeit that the New York market climbed back from the lows of the day and with the Brazil Real showing further signs of weakness towards the US Dollar, one might think the markets are due for slightly better than a hesitant steady start to early trade today, against the prices set yesterday, as follows:

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

NOV 1349 + 8 DEC 110.50 – 0.15
JAN 1365 + 8 MAR 112.25 – 0.20
MAR 1378 + 7 MAY 113.70 – 0.25
MAY 1393 + 8 JUL 115.15 – 0.20
JUL 1408 + 8 SEP 116.25 – 0.25
SEP 1424 + 8    DEC 117.50 – 0.30
NOV 1440 + 7 MAR 118.80 – 0.35
JAN 1458 + 8   MAY 119.85 – 0.30