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 cut their net long position within this market by 9.07% over the week of trade leading up to Tuesday 29th. March; to register a new net long position 24,632 Lots. Meanwhile the longer term in nature Index Fund sector of this market cut their net long position within the market by 0.58%, to register a net long position of 39,248 Lots on the day.

Over the same week, the Non-Commercial Speculative sector cut their net long position by 15.69% within the market over the week of trade leading up to Tuesday 29th. March: to register a net long position of 15,734 lots, which is the equivalent of 4,460,519 bags. This net long position has most likely been little changed following the period of mixed but overall sideways trade that has since followed.

The latest Commitment of Traders report from the London Robusta coffee market has seen the Speculative Managed Money Sector of this increase their net long position by 3.37% within the market over the week of trade leading up to Tuesday 29th. March 2022: to register a new net long position of 20,079 which is the equivalent of 3,346,500 bags. This net long position has most likely been increased marginally following the period of mixed but overall firmer that has since followed.

The May 2022 to May 2022 contract arbitrage between the London and New York markets widened yesterday to register this at 133.89 usc/Lb. This equates to 58.06% 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 5,002 bags yesterday, to register these stocks at 1,089,844 bags, with 95.11% of these certified stocks being held in Europe at a total of 1,036,510 bags and the remaining 4.89% being held in the USA at a total 50,334. Of this, a total 545,793 bags, or 50.08% of the coffees registered and stored in consumer country certified warehouses of the exchange, Brazil washed arabica, and a further 43.27% of these certified coffees, originating from Honduras. There were meanwhile 6,072 bags decrease to the number of bags pending grading to the exchange; to register 14,994 bags pending grading on the day.

It was a mixed day on the commodity markets yesterday, as macroeconomic signals point towards higher inflation, with investors waiting news from the next US Federal Reserve policy meeting due to be released tomorrow which may provide direction on potential interest rate hikes. The Sugar, New York Arabica Coffee, Wheat, Soybean, Corn, Gold and Palladium markets ended the day on a positive note, while the Cocoa, London Robusta Coffee, Silver and Platinum markets ended the day on a softer note. The day starts with the U.S. Dollar trading at 1.312 Sterling, at 1.096 the Euro and with the US Dollar buying 4.595 Brazil Real.

The New York market and London markets started the day yesterday trading on a modest softer note, both markets quickly dropped back to be set on a softer path for the remainder of the morning session. the markets would trend lower to hit a floor limiting the losses for the day. as the afternoon progressed the markets were seen to attract a degree of support which saw the markets trend in a positive direction. This momentum was carried through to the late afternoon session. The London market was seen to drop back and settle on a modest near to unchanged firmer note at the close, while the New York market carried the early momentum through to the close to settle on a firmer note.

The London market ended the day on a modest near to unchanged negative note with 18.92% of the earlier losses of the day intact, while the New York market ended the day on a positive note with 63.77% of the earlier gains of the day intact. This mixed but overall follow through firmer close for the markets might indicate some degree of direction, with the New York market gaining momentum late in the day, one might think that the markets are due for a steady start to early trade today, against the prices set yesterday, as follows:

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

MAY 2132 – 7                                            MAY 230.60 + 2.20
JUL 2122 – 8                                              JUL 230.60 + 2.15
SEP 2116 – 4                                              SEP 229.80 + 2.05
NOV 2109 – 4                                            DEC 227.65 + 2.15
JAN 2100 – 3                                             MAR 225.40 + 2.50
MAR 2098 – 2                                            MAY 223.50 + 2.70
MAY 2095 – 2                                            JUL 220.80 + 2.90
JUL 2092 – 2                                              SEP 217.55 + 2.95