Coffee Market Report
The latest Commitment of Traders report from the New York arabica market has seen the Non-Commercial Speculative sector decrease their net short position by 10.94% within the market over the week of trade leading to Tuesday 29th. August 2023: to register a new net short position of 27,890 lots, which is the equivalent of 7,906,691 bags. This net short position has most likely been little changed following the period of 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 decrease their net long position by 8.13% within the market over the week of trade leading to Tuesday 29th. August 2023: to register a new net long position of 15,789 Lots which is the equivalent of 2,631,500 bags. This net long position has most likely been little changed following the period of mixed but overall firmer trade that has since followed.
The National Coffee Institute of Honduras (IHCAFE) have reported preliminary data that the country’s coffee exports for the month of August were 91,266 bags or 37.22% higher than the same month last year, at a total of 336,500 bags. This they say has contributed to the cumulative coffee exports for first eleven months of the current October 2022 to September 2023 coffee year to be around 720,000 bags or 16.18% higher than the same period in the previous coffee year, at a total of 5.17 million bags. IHCAFE expects that exports from the current October 2022 to September 2023 crop year are forecast to be 17.45% higher than the previous October 2021 to September 2022 year, to reach a total of 5.52 million bags.
The National Coffee Institute of Costa Rica (ICAFE) have reported that the country’s coffee exports for the month of August were 11,783 bags or 11.10% lower than the same month last year, at a total of 91,884 bags. This they say has contributed to the cumulative coffee exports for the first eleven months of the current October 2022 to September 2023 coffee year to be 7.30% lower than the same period in the previous year, at a total of 953,692 bags.
The Brazil government have reported preliminary data that illustrates the country’s green coffee exports for the month of August were 41.16% higher than the same month last year, at a total of 3.29 million bags. The official breakdown of coffee exports by description for August will soon be released and can be anticipated to illustrate this figure more accurately.
The USA will be observing their Labour Day holiday today, which will see the market closed for the day. Thus, leaving the London market to trade solo for the day.
The Certified washed Arabica coffee stocks held against the New York exchange were seen to decrease by 1,355 bags on Friday, to register these stocks at 483,383 bags, with 98.41% of these certified stocks being held in, Europe at a total of 474,745 bags and the remaining 1.59% being held in the USA at a total 8,683. Of this, a total 130,432 bags, or 26.98% of the coffees registered and stored in consumer country certified warehouses of the exchange, Brazil washed arabica, and a further 68.02% of these certified coffees, originating from Honduras. There was meanwhile no change to the number of bags pending grading to the exchange; to register 0 bags pending grading on the day.
The November 2023 to December 2023 contract arbitrage between the London and New York markets narrowed on Friday to register this at 39.32 usc/Lb. This equates to 25.88% price discount for the London Robusta coffee.
It was mixed day on the commodity markets on Friday, as investors await further cues following newly released US jobs data on potential interest rate hikes to come. The Corn, Sugar, Soybean, Gold and Palladium market ended the day on a positive note, while the Coffee, Cocoa, Wheat, Silver and Platinum markets ended the day on a softer note. The day starts with the U.S. Dollar trading at 1.260 Sterling, at 1.078 the Euro and with the US Dollar buying 4.946 Brazil Real.
The New York and London markets started the day on Friday trading to the south of par on modest softer notes respectively. The markets oscillated to either side of par for the remainder of the early morning session. The late morning session saw the markets begin to attract some degree of selling pressure and start to track lower into the late morning session. As the afternoon progressed, the markets continued to trend in a softer direction, dropping back from the earlier modest highs, weighed by selling in what was mainly technical trade to see the New York market drop back below par, with the London market following suit. The markets continued a downward trajectory, accentuating the losses along the way. The selling activity started to wane toward the end of the days’ trade, to see the New York market narrowly recover some of the earlier losses of the day, while the London market recovered half of the earlier losses of the day. This saw both the New York and the London market settle in negative territory although above the lows on the day, in both markets.
The London market ended the day on a modest negative note with 50% of the earlier losses of the day intact, while the New York market ended the day on a likewise negative note with 91.22% of the earlier losses of the day intact. This follow through softer close, with the markets settling near to the lows of the day, might indicate that the London market is due for a hesitant start to the day, against the prices set on Friday, as follows:
LONDON ROBUSTA US$/MT NEW YORK USC/LB.
NOV 2482 – 7 DEC 151.90 – 2.60
JAN 2383 – 3 MAR 153.25 – 2.40
MAR 2328 Unch MAY 154.20 – 2.40
MAY 2306 – 1 JUL 154.75 – 2.40
JUL 2298 – 1 SEP 155.20 – 2.40
SEP 2292 – 1 DEC 156.15 – 2.45
NOV 2289 – 1 MAR 157.35 – 2.35
JAN 2283 – 1 MAY 158.45 – 2.35
