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 7.32% within this market over the week of trade leading up to Tuesday 15th. October 2024; to register a new long position at 56,201 Lots. The longer term in nature, Index Fund sector of this market decreased their net long position by 2.03% within the market, to register a new net long position of 51,863 Lots on the day.
Over the same week, the Non-Commercial Speculative increase their net long position by 12.86% within the market over the week of trade leading to Tuesday 15th. October 2024: to register a new net long position of 40,656 lots, which is the equivalent of 11,525,796 bags. This net long position has most likely been little changed further following the period of overall sideways trade that has since followed.
The National Coffee Growers Federation in Colombia have reported that the country’s coffee production for the coming 2024/2025 coffee year is expected to increase by 15.05% from the current year to total around 13 million bags. The report also states that an additional 100,000 hectares of coffee will be replaced with new varieties this year, bringing the total area under coffee in Colombia to 842,000 hectares. With a focus on increasing productivity levels to reach 17 bags per hectare, with an increase in the use of inputs such as fertiliser. The National Coffee Growers Federation have reported that the country’s cumulative coffee exports for the full October 2023 to September 2024 coffee year is 1,082,000 bags or 10.09% higher than the 2022/23 coffee year, at a total of 12,749,000 bags.
The National Coffee Institute of Costa Rica (ICAFE) have estimated that coffee production for the current October 2024 to September 2025 coffee year will be 1.70 million bags of coffee, up 5.59% from the 2023/2024 coffee year. ICAFE have likewise forecasted that green coffee exports from the 2024/2025 year will reach 1.32 million bags or marginally higher than the 2023/2024 year. ICAFE will soon release the exports for September 2024, to complete the 2023/24 coffee year. Cumulative coffee exports for the first eleven months of the October 2023 to September 2024 coffee year are reported at 0.23% lower than the same period in the previous year, at a total of 921,507 bags.
The weather reports from Brazil indicate that the main arabica coffee districts in Southeast Brazil have been in receipt of good rains over the recent days, and it is forecast to see these rains continue over the next week, assisting to keep temperatures in the mid-twenties in degrees Celsius.
The Certified washed Arabica coffee stocks held against the New York exchange were seen to increase by 252 bags yesterday, to register these stocks at 849,961 bags, with 98.03% of these certified stocks held in Europe at a total of 833,187 and the remaining 1.97% being held in the USA at a total 16,774 Bags. Of this, a total 397,244 bags, or 46.74% of the coffees registered and stored in consumer country certified warehouses of the exchange, are Brazil washed arabica, and a further 33.65% of these certified coffees, from Nicaragua. The pending grading stocks were seen to increase by 5,055 bags, to register 94,404 bags pending grading on the day.
The November 2024 to December 2024 contract arbitrage between the London and New York markets widened yesterday, to register this at 44.09 Usc/Lb. This equates to 17.52% price discount for the London robusta coffee.
It was mixed but firmer day on the commodity markets yesterday, with the leading in influence Oil market firmer on the day, ahead of the next US Federal Reserve Policy meeting due to take place during the first week of November. The Cocoa, Corn, Soybean, Sugar, Gold and Silver markets ended the day on a firm note, while the Coffee, Wheat, Platinum and Palladium markets ended the day on a softer note. The day starts with the U.S. Dollar trading at 1.299 Sterling, at 1.082 the Euro and with the US Dollar buying 5.689 Brazil Real.
The New York and London markets started the day yesterday trading to the south of par, pressured lower from the outset of the day’s session. The markets continued to attract resistance to drop further below par accentuating the loses for the day, setting a low for the day. As the afternoon progressed the volume increased, to contribute to the day’s direction with speculative selling pressuring the New York market lower as stops were triggered along the way. The London market followed suit, and the markets continued to project lower with a measure of speculative long liquidation to accentuate the losses for the day’s trade. The afternoon session saw the markets rebound from the lows of the day to recover some of the earlier losses, in fair volumes on the day. The New York market recovered some of the losses to settle on a softer note at the close, albeit within a relatively wide range on the day whilst the London market recovered more than half of the earlier losses to settle on a softer note at the close.
The London market ended the day on a negative note with 70.62% of the earlier losses of the day intact, while the New York market ended on a likewise negative note, with 60.54% of the earlier losses of the day intact. This softer close for both New York and London markets, with the markets pressured lowered throughout the session to see the markets settle with more than half of the earlier losses of the day intact, might see the markets pressured for a follow through hesitant start to early trade today, as follows:
LONDON ROBUSTA US$/MT NEW YORK USC/LB.
NOV 4577 – 125 DEC 251.70 – 5.60
JAN 4503 – 112 MAR 250.45 – 5.55
MAR 4405 – 107 MAY 248.55 – 5.50
MAY 4324 – 106 JUL 245.35 – 5.45
JUL 4237 – 103 SEP 241.65 – 5.40
SEP 4165 – 99 DEC 235.85 – 5.15
NOV 4088 – 98 MAR 230.90 – 4.90
JAN 4008 – 98 MAY 226.55 – 4.50
