Coffee Market Report
The latest Commitment of Traders report from the New York arabica coffee market has seen the shorter term in nature Managed Money fund sector of this market increase their net long position within this market by 7.65% over the week of trade leading up to Tuesday 2nd. March; to register a new net long position of 37,876 lots. Meanwhile the longer term in nature Index Fund sector of this market cut their net long position within the market by 1.30%, to register a net long position of 72,608 Lots on the day.
Over the same week, the Non-Commercial Speculative sector of this market increased their net long position within the market by 2.43% to register a new net long position of 36,285 Lots which is the equivalent of 10,286,637 bags. This net long position has most likely been marginally increased, following the period of softer trade that has since followed.
Speculative sentiment within the New York market remains mildly bullish, with the view being taken that the prospects for a smaller biennially bearing Brazil arabica coffee crop this year, contributing toward a global coffee supply deficit that is being estimated at a median 9.50 million bags, for the coming October 2021 to September 2022 coffee year.
The May-to-May contract arbitrage between the London and New York markets widened yesterday: to register this at 67.45 usc/Lb. This equates to 52.22% 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 8,635 bags yesterday, to register these stocks at 1,815,568 bags, with 94.7% of these certified stocks being held in Europe at a total of 1,719,097 bags and the remaining 5.3% being held in the USA at a total 96,471 bags. There was meanwhile a larger in number 9,280 bags decrease to the number of bags pending grading for this exchange; to register these pending grading stocks at 49,186 bags.
It was a softer day overall on the commodity markets yesterday, to see the overall macro commodity index taking something of a sideways track for the day. The New York Arabica Coffee market ended the day on a positive note, while the Sugar, Cocoa and London Robusta Coffee markets ended the day on a softer note. The Reuters Equal Weight Continuous Commodity Index that is related to 17 markets is 0.45% higher; to see this index registered 493.54. The day starts with the U.S. Dollar, trading at 1.385 Sterling, at 1.186 the Euro and with the US Dollar buying 5.876 Real.
The New York and London markets started the day yesterday trading on a modest softer note, the New York market continued to oscillate around par for the remainder of the morning session, while the London market dropped back further to see the market set on a softer track for the morning session. As the afternoon progressed the New York market gained some momentum attracting a degree of buying support to see the market hit a ceiling limiting the gains for the day, the London market followed suit in a more sedate manner to see the market drop back late in the day to settle on a softer note for the day.
The London market ended the day on a negative note with 86.96% of the earlier losses of the day intact, while the New York market ended the day on a modest positive note with 14.29% of the earlier gains of the day intact. This mixed close, with the New York market retaining a small degree of the earlier in the day gains and the London market settling near to the lows of the day, one might think that the markets are due for little better than a hesitant steady start for early trade today, against the prices set yesterday, as follows:
LONDON ROBUSTA US$/MT NEW YORK ARABICA USc/Lb.
MAY 1361 – 20 MAY 129.15 + 0.30
JUL 1382 – 18 JUL 131.15 + 0.30
SEP 1399 – 16 SEP 133.00 + 0.35
NOV 1414 – 15 DEC 134.85 + 0.45
JAN 1428 – 15 MAR 136.45 + 0.55
MAR 1444 – 15 MAY 137.30 + 0.60
MAY 1460 – 15 JUL 137.85 + 0.60
JUL 1475 – 15 SEP 138.20 + 0.55
