Coffee Market Report
The world’s largest coffee cooperative Cooxupé, in Brazil, have come forth with a report this week, that it exported 4.50 million bags during the 2023 calendar year, this number 2.30 million bags or 33.82% lower than the 2022 year. The main contributing factor, as reported, was that internal prices remained low during the last quarter of the year and some producers decided to hold onto their coffees, along with the continued shipping backlogs and congestion from the ports of Brazil with increased freight costs and limited container equipment availability continuing to plague this leading exporter of agricultural products. Cooxupé also reported that total revenue fell from 10.10 billion Reais in 2022 to 6.40 billion Reais in 2023.
Cooxupé expects that they shall be in receipt of 13.33% more coffee from this year's biennially bearing harvest. The report indicates that their expectation is to receive 6.80 million bags of coffee from their farmers. The reports also forecasts that the cooperative expects coffee exports for the coming year to be 22.22% higher than 2023 at a total of 5.50 million bags.
With a long weekend ahead, the London market will be closed tomorrow and again on Monday in observance of Easter, while the New York market shall be closed tomorrow and to trade solo for a shortened trading day on Monday.
The Certified washed Arabica coffee stocks held against the New York arabica market were seen to decrease by 1,500 bags yesterday, to register these stocks at 583,879 bags, with 99.64% of these certified stocks being held in, Europe at a total of 581,794 bags and the remaining 0.36% being held in the USA at a total 2,085 Bags. Of this, a total 308,694 bags, or 52.87% of the coffees registered and stored in consumer country certified warehouses of the exchange, are Brazil washed arabica, and a further 19.87% of these certified coffees, originating from Honduras. The pending grading stocks were seen to increase by 20,470 bags; to register 90,983 bags pending grading on the day.
The May 2024 to May 2024 contract arbitrage between the London and New York markets narrowed yesterday, to register this at 29.22 Usc/Lb. This equates to 15.33% price discount for the London Robusta coffee.
It was a mixed day on the commodity markets yesterday, with key US inflation data due out later today ahead of the Good Friday Holiday tomorrow which will see many of the markets closed for the day. The Coffee, Cocoa, Gold and Silver markets ended the day on a positive note, while the Corn, Sugar, Soybean, Wheat, Platinum and Palladium markets ended the day on a negative note. The day starts with the U.S. Dollar trading at 1.263 Sterling, at 1.082 the Euro and with the US Dollar buying 4.992 Brazil Real.
The New York and London markets started the day yesterday carrying through momentum from the close on Tuesday to trade on firmer notes respectively. Both markets attracted support during the early morning session to track mildly firmer for the remainder of the morning session before gaining momentum, as support was seen to build during the late morning session. As the afternoon progressed the New York market hit a ceiling to limit the gains for the day with sellers returning to the floor. The New York market was weighed lower before finding support late in the day to see the market rally and gain momentum quickly towards the close. The London market continued a firmer path carrying upward momentum into the afternoon session. The London market dropped back from the late afternoon highs to settle on a firmer note, while the New York market continued to build momentum towards the close, to settle on a firmer note.
The London market ended the day on a positive note with 70.15% of the earlier gains of the day intact, while the New York market ended the day on a likewise positive note, with 58.43% of the earlier gains of the day intact. This firmer close for the markets, might provide some degree of support and direction, albeit that both the New York and the London markets fell back from the highs of the morning session but were seen to gain momentum towards the close, one might think that the markets are due for a follow through steady start to early trade today, against the prices set yesterday, as follows:
LONDON ROBUSTA US$/MT NEW YORK USC/LB.
MAY 3559 + 94 MAY 190.65 + 2.60
JUL 3467 + 92 JUL 189.90 + 2.65
SEP 3385 + 83 SEP 189.45 + 2.65
NOV 3295 + 70 DEC 189.05 + 2.55
JAN 3210 + 56 MAR 189.60 + 2.65
MAR 3155 + 50 MAY 190.50 + 2.65
MAY 3103 + 41 JUL 190.80 + 2.60
JUL 3023 + 18 SEP 190.40 + 2.50
