Coffee Market Report

The latest Commitment of Traders report from the New York arabica market has seen the Non-Commercial Speculative sector increase their net long position by 4.24% within the market over the week of trade leading to Tuesday 12th March 2024: to register a new long position of 34,029 lots, which is the equivalent of 9,647,071 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 latest Commitment of Traders report from the London Robusta coffee market has seen the Speculative Managed Money Sector increase their net long position by 4.24% within the market over the week of trade leading to Tuesday 12th March 2024: to register a new net long position of 42,989 Lots which is the equivalent of 7,164,833 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 Certified washed Arabica coffee stocks held against the New York arabica market were seen to increase by 20,853 bags on Friday, to register these stocks at 488,678 bags, with 99.13% of these certified stocks being held in, Europe at a total of 484,423 bags and the remaining 0.87% being held in the USA at a total 4,255 Bags. Of this, a total 256,824 bags, or 52.56% of the coffees registered and stored in consumer country certified warehouses of the exchange, are Brazil washed arabica, and a further 24.10% of these certified coffees, originating from Honduras. The pending grading stocks were seen to decrease by 7,093 bags; to register 154,630 bags pending grading on the day.

The May 2024 to May 2024 contract arbitrage between the London and New York markets narrowed on Friday, to register this at 32.91 Usc/Lb. This equates to 17.99% price discount for the London Robusta coffee.

It was a mixed but overall firmer day on the commodity markets on Friday, after newly released economic data, late last week, showed U.S. consumer prices increased above expectations in February and producer prices also showed signs of inflation, leading investors to think that rate cuts may only come later than expected. With the leading in influence Oil markets firmer on the day. The London Robusta Coffee, Cocoa, Corn, Soybean, Sugar, Silver, Platinum and Palladium markets ended the day on a positive note, while the New York Arabica Coffee, Wheat and Gold markets ended the day on a negative note. The day starts with the U.S. Dollar trading at 1.279 Sterling, at 1.089 the Euro and with the US Dollar buying 4.995 Brazil Real.

The New York and London markets started the day on Friday trading in firmer territory, the markets continued to trade to the north of par in modest firmer territory for the remainder of the early morning session. The New York and London markets were seen to hit a modest high for the morning before attracting selling pressure to see the markets drop back from the earlier highs and trade below par for the remainder of the morning session as selling pressure began to build. As the afternoon progressed, the markets continued to see selling pressure build, to see both the New York and the London markets drop back from the earlier highs and trend in a softer direction. The markets found support near to the lows of the day, to rebound and find support trending back towards par, albeit under modest volumes of trade. The London market recovered all of the earlier losses to gain momentum during the late afternoon session to make gains towards the close. The London market settled near to the highs of the day on a firmer note. The New York market recovered half of the earlier losses of the day to settle on a modest softer note on the close.

The London market ended the day on a positive note with 75.61% of the earlier gains of the day intact, while the New York market ended the day on a modest negative note with 50% of the earlier losses of the day intact. This mixed close for the markets, with the London market settling on a firm note albeit back from the highs of the day and the New York market settling on a modest softer note with half of the earlier losses of the day intact, does little to inspire confidence and one might think that the markets are due for a steady start to early trade today, against the prices set on Friday, as follows:

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

MAY   3308 + 31                                         MAY  182.95 – 0.90
JUL     3211 + 28                                         JUL    181.65 – 0.60
SEP     3139 + 26                                         SEP    181.35 – 0.50
NOV   3062 + 26                                         DEC   181.05 – 0.55
JAN    2999 + 27                                         MAR  181.25 – 0.55
MAR  2951 + 27                                         MAY  181.50 – 0.55
MAY  2922 + 27                                         JUL    181.45 – 0.50
JUL    2899 + 27                                         SEP    181.30 – 0.35