Market Reports

The weather conditions within Brazil are being monitored as the first months of harvest in the Brazil Conilon robusta areas is set to begin in the coming weeks, while the arabica harvest is due to begin around mid-year. There are reports of reduced rainfall in the first two weeks of this month for some regions within the vast Brazil coffee growing landscape, to include areas as far apart as Cerrado and Sao Paulo. For the most part soil moisture levels are reported to be normal following the average seasonal rainfall leading up to February. A continuation of rain in the arabica areas is being closely monitored, where the crop is in the development phase and for the most part is not irrigated and is dependent on rainfall. Early reports for the week ahead indicate scattered showers forecast across the arabica growing regions. The rains are seasonally anticipated to taper off within the next couple of months, heading into the traditionally drier winter months.

The external influence and macroeconomic action surrounding the US Dollar against other major currencies, has seen the Brazil Real gain 1.81% in value against the US Dollar during the first two weeks of March and well financed producers continue to limit activity internally with what little coffee from the current July 2024 to June 2025 coffee season remains.

The German Coffee Association, Deutscher Kaffeeverband report this country’s per capita coffee consumption at an average 163 litres a year. According to data from the European Union, Germany imports around 15 million bags of green coffee annually, with re-exports of green coffee accounting for 23% or 3.45 million bags and Value Add finished coffee product exports totalling around 4.23 million bags or 28.45% leaving the balance available for local consumption of coffee. The largest increase seen in the whole bean segment, which grew 2% year on year. The instant coffee segment reported growth of 2% year on year whilst the single serve coffee segment saw an 6% growth in demand during 2024. The growth trend in certified coffee is also evident, as sustainably sourced coffee that carry either Organic, Fairtrade, Rainforest Alliance, or 4C’s labels saw an increase in demand by 8.6% during 2024. This rise in demand may be attributed to increasing consumer awareness of ethical sourcing, environmental sustainability, or social responsibility, as well as the alignment with approaching EUDR. Multinational coffee roasters have thrown their weight behind sustainable sourcing and continue to push this agenda forward, likely contributing toward the growth in this segment, with perhaps the affordability levels to carry their publicly communicated responsible sourcing policies, and sustainability commitments within the coffee sector.

The Certified washed Arabica coffee stocks held against the New York exchange were seen to increase by 3,626 bags yesterday, to register these stocks at 803,032 bags, with 96.76% of these certified stocks held in Europe, at a total of 776,985 bags and the remaining 3.24% being held in the USA at a total 26,047 Bags. Of this, a total 525,426 bags or 65.43% of the coffees registered and stored in consumer country certified warehouses of the exchange, are Brazil washed arabica, and a further 9.40% of these certified coffees, from Peru. The pending grading stocks posted a decrease of 3,392 bags on the day, to register 32,960 bags pending grading on the day.

The May 2025 to May 2025 contract arbitrage between the London and New York markets widened yesterday, to register this at 141.91 Usc/Lb. This equates to 36.04% price discount for the London robusta coffee.

It was a mixed but overall softer day overall on the commodity markets yesterday, with investor focus shifting to the consumer price index CPI data due to be released later today in the U.S.A. According to a Reuters poll, February’s CPI data is expected to have climbed 0.3%, indicating the likelihood for an interest rate cut to come during the second half of the year. This while investors await US Consumer Price Index Data due out later today. The Coffee, Sugar, Gold, Silver and Platinum markets ended the day on a firmer note, while the Cocoa, Corn, Sugar, Soybean, Wheat and Palladium markets ended the day on a softer note. The day starts with the U.S. Dollar trading at 1.292 Sterling, at 1.090 the Euro and with the US Dollar buying 5.810 Brazil Real.

The New York and London markets opened the day on a positive note, with the markets continuing to trade in firmer territory throughout the remainder of the early morning session in limited trade volume. The New York market fell back off the highs of the morning for a brief period during the late morning session. The London market continued to trade in positive territory, making gains throughout the session. As the afternoon progressed, the New York market found support to trend in a firmer direction, where buyers returned to the floor in the absence of sellers, the day tracked higher quickly to trigger buy stops along the way. This firmer action continued in both the New York and London markets as the day progressed. The upward moment in New York was capped late in the day, to see the market settle on a firm note at the close with most of the earlier gains of the day intact, ahead of options expiry in the New York market on Friday. The London market followed suit to also settle on a firm note at the close, with most of the earlier gains of the day intact.

The London market ended the day on a positive note with 83.50% of the earlier gains of the day intact, while the New York market ended the day on a likewise positive note, with 84.79% of the earlier gains of the day intact. The firmer close for the markets, with both the New York and London markets trading in firmer territory to settle near to the highs of the day, albeit in a comparatively light volume day. With the speculative sector at the helm and technical moves in play, the markets might be in for a follow through steady start to early trade today, against the prices set yesterday, as follows: