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 increase their net short position by 153.59% within this market over the week of trade leading up to Tuesday 10th. January 2023; to register a new net short position at 30,172 Lots. Meanwhile the longer term in nature Index Fund sector of this market increased their net long position by 3.94% within the market, to register a new net long position of 36,163 Lots on the day.

Over the same week, the Non-Commercial Speculative increased their net short position by 114.70% within the market over the week of trade leading to Tuesday 10th. January 2023: to register a net short position of 31,070 lots, which is the equivalent of 8,808,207 bags. This net short position has most likely been increased following the period of mixed but overall softer trade that has since followed.

The Coffee Exporters Association in Brazil Cecafé have reported that the countries green coffee exports for the month of December were 16.57% lower than the same month last year, to total 2.86 million bags, this number made up of 2.81 million bags of arabica coffee down 14.62% from the same month last year and 55,490 bags of Conilon robusta coffee down 61.32% from the same month last year.

The Coffee Exporters Association in Brazil, Cecafé have also reported the cumulative exports of green coffee for the first six months of the current July 2022 to June 2023 Brazil coffee year, to be narrowly lower overall, when compared to the same time in the previous coffee year, at a total of 17.47 million bags.

The majority of commodity markets in the U.S.A. were closed yesterday for the Martin Luther King national holiday, which left the London Robusta Coffee market trading solo for the day.

The March 2023 to March 2023 contract arbitrage between the London and New York markets narrowed yesterday to register this at 65.20 usc/Lb. This equates to 42.97% 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 5,146 bags on Friday, to register these stocks at 850,724 bags, with 94.36% of these certified stocks being held in Europe at a total of 802,781 bags and the remaining 5.64% being held in the USA at a total 47,943. Of this, a total 466,010 bags, or 54.79% of the coffees registered and stored in consumer country certified warehouses of the exchange, Brazil washed arabica, and a further 41.20% of these certified coffees, originating from Honduras. There was meanwhile a 16,284 bags decrease to the number of bags pending grading to the exchange; to register 139,161 bags pending grading on the day.

With most of the U.S.A. commodity markets off the field of player yesterday, the remaining open markets had a quiet day yesterday, but with the overall commodity index for these markets showing a degree of softer trade. The Sugar market ended the day on a positive note, while the London Robusta Coffee, Cocoa, Gold, Silver, Platinum and Palladium markets ended the day on a softer note. The day starts with the U.S. Dollar trading at 1.219 Sterling, at 1.085 the Euro and with the US Dollar buying 5.147 Brazil Real.

The London market trading solo for the day yesterday, started the day yesterday trading close to par on a negative note and remained in a narrow range for the limited volume traded throughout the day. The afternoon progressed with the markets holding near unchanged, the late afternoon saw the market coming under pressure and seen to fall back into what would be considered modest negative territory. This saw the London market settle on a modest softer note at the close.

The London market ended the day yesterday on a modest negative note with 56.25% of the earlier losses of the day intact, while the New York market was closed for the day. This modest near to unchanged close for the London market trading solo for the day, does little to indicate direction, and one might think that the markets are due for little better than a hesitant steady start for early trade today, against the prices set in London yesterday and New York on Friday, as follows:

LONDON ROBUSTA US$/MT              NEW YORK USC/LB.
Close: 16/01/2023                                    Close: 13/01/2023

MAR   1907 – 9                                       MAR   151.70 + 2.30
MAY   1871 – 8                                       MAY   152.55 + 2.40
JUL     1847 – 10                                     JUL      153.10 + 2.50
SEP     1828 – 11                                     SEP      153.45 + 2.60
NOV   1816 – 11                                     DEC     153.65 + 2.70
JAN    1810 – 11                                     MAR    154.10 + 2.75
MAR  1808 – 11                                     MAY     154.55 + 2.80
MAY  1814 – 11                                     JUL       154.90 + 2.75