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 increase their net long position by 4.90% within this market over the week of trade leading up to Tuesday 13th February 2024; to register a new long position at 50,539 Lots. The longer term in nature Index Fund sector of this market increases their net long position by 3.26% within the market, to register a new net long position of 55,334 Lots on the day.

Over the same week, the Non-Commercial Speculative increased their net long position by 8.94% within the market over the week of trade leading to Tuesday 13th February 2024: to register a new net long position of 38,602 lots, which is the equivalent of 10,790,408 bags. This net long position has most likely been marginally decreased following the period of mixed but overall softer trade that has since followed.

The certified washed arabica coffee stocks held against the New York Exchange continue to register gradual daily increase for three consecutive days, climbing from more than twenty-year lows recorded earlier in the year, to register a still comparatively low 307,262 bags yesterday. This marks a drawdown of 484,441 bags or 61.19% from the same time last year when the certified washed arabica coffee stocks registered 791,703 bags on 19th February 2023. These daily released figures are received by the speculative sector of the markets, as an indication of arabica coffee availability, or lack thereof, in the consumer markets where these exchange certified coffee stocks are held. These certified stocks stored in consumer country warehouses, are usually stored for extended periods of time, and accumulate discounts which would have added incentive for price pressured roasters to draw from these comparatively less expensive certified stocks over the same time.

The Certified washed Arabica coffee stocks held against the New York arabica market that was closed yesterday, maintained the same figures as Friday, to register these stocks at 307,262 bags, with 98.44% of these certified stocks being held in, Europe at a total of 302,457 bags and the remaining 1.56% being held in the USA at a total 4,805 Bags. Of this, a total 114,094 bags, or 37.13% of the coffees registered and stored in consumer country certified warehouses of the exchange, are Brazil washed arabica, and a further 39.12% of these certified coffees, originating from Honduras. There was meanwhile a 2,240 bags decrease to the number of bags pending grading to the exchange; to register 65,717 bags pending grading on the day.

The Certified Robusta coffee stocks held against the London Exchange were seen to decrease by 80,167 bags during the week up to the 16th February 2024, to register a comparatively low total of 326,667 bags. This is 732,333 bags or 69.15%, lower than the same time last year.

Many commodity markets in the U.S.A. were closed yesterday for the Presidents Day national holiday, which left the London Robusta Coffee market trading solo for the day.

The May 2024 to May 2024 contract arbitrage between the London and New York markets narrowed yesterday, to register this at 42.82 Usc/Lb. This equates to 22.94% price discount for the London Robusta coffee.

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 muscle. The US dollar traded firmer on the day. The London Robusta Coffee, Cocoa and Gold markets ended the day on a positive note, while the Silver, Platinum and Palladium markets ended the day on a softer note. The day starts with the U.S. Dollar trading at 1.258 Sterling, at 1.077 the Euro and with the US Dollar buying 4.956 Brazil Real.

The London market trading solo for the day yesterday, started the day trading on a firmer note carrying through the momentum from the close on Friday. The London market continued to trend in a firmer direction, buoyed by support throughout the morning session. As the afternoon progressed the market was seen to hit a ceiling to limit the gains for the day, this saw the London market drop back from the earlier highs and settle into a range during the late afternoon session. The London market was seen to settle on a firmer note, following a modest volume day, at the close with most of the earlier gains for the day intact.

The London market ended the day on a positive note with 60% of the earlier gains of the day intact, while the New York market ended the day on a likewise positive note with 62% of the earlier gains of the day intact. This firmer close for the London market trading solo for the day the day, might assist to indicate some degree of direction and provide support to see the markets set for a follow through steady start to 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: 19/02/2024                                       Close: 16/02/2024

MAR   3280 + 49                                         MAR      190.85 + 1.55
MAY   3172 + 31                                         MAY      186.70 + 1.55
JUL     3101 + 25                                         JUL        185.60 + 1.50
SEP     3038 + 22                                         SEP        185.45 + 1.55
NOV   2975 + 21                                         DEC       185.70 + 1.85
JAN    2924 + 20                                         MAR      185.95 + 1.95
MAR  2896 + 20                                         MAY      186.40 + 1.95
MAY  2876 + 20                                         JUL        186.60 + 1.95