Coffee Market Report
The latest Commitment of Traders report from the New York arabica coffee market has seen the Non-Commercial Speculative sector of this market increase their net short sold position within the market by 38.66% during the week of trade leading up to Tuesday 29th. August; to register a net short sold position of 26,362 Lots on the day. This net short-sold position which is the equivalent of 7,473,510 bags has most likely been little changed to perhaps marginally decreased again, following the period of mixed but overall steadier trade, which has since followed.
The National Coffee Institute in Honduras have reported that the country’s coffee exports for the month of August were 221,092 bags or 93.76% higher than the same month last year, at a total of 456,903 bags. This improved performance the National Coffee Institute report, has seen the countries cumulative coffee exports for the first eleven months of the present October 2016 to September 2017 coffee year increase by 1.94 million bags over the same period in the previous coffee year, to total 7.08 million bags.
Within the same report the National Coffee Institute in Honduras have forecast that with this month’s exports, that they foresee that the country’s coffee exports for the present coffee year shall end up approximately 2.1 million bags higher than the previous coffee year, at a total of 7.2 million bags. This being a remarkable performance in terms of the fact that Honduras is only a relatively small nation, with a land mass of only 112,492 square kilometres.
The National Coffee Institute in Costa Rica has reported that the country’s coffee exports for the month of August were 15,442 bags or 16.99% lower than the same month last year, at a total of 75,428 bags. This modest number the Coffee Institute reports, has contributed to the country’s cumulative coffee exports for the first eleven months of the present October 2016 to September 2017 coffee year to being approximately 187,000 bags lower than the same period in the previous coffee year, at a total of 1.01 million bags.
Albeit that if one is to add up the month by month coffee export reports from the National Coffee Institute in Costa Rica since October last year, the eleven-month total would calculate to a higher 1,085,335 bags. This relatively small dip in Costa Rican fine washed arabica coffee exports is however and not matter which number might be correct, insignificant in terms of the surge in exports from Honduras, which contributes to rising consumer market supply from the Mexican and Central American producer bloc and is starting to reflect, in terms of the steadily rising number of coffees being held within the Certified stocks of the New York exchange.
The Ministry of Trade in Brazil have reported that the countries coffee exports for the month of August were 249,172 bags or 9.49% lower than the same month last year, at a total of 2,375,452 bags. This dip and with the new crop coffees now readily available, might not be a reflection of the lower arabica coffee crop this year, but might be more related to the combination of difficulties within the port of Santos that has delayed many shipments over the past few weeks.
The November to December contracts arbitrage between the London and New York markets broadened on Friday, to register this at 35.66 usc/Lb., while this equates to 27.63% price discount for the London Robusta coffee market.
The Certified washed Arabica coffee stocks held against the New York exchange were seen to increase by 7,184 bags on Friday; to register these stocks at 1,715,082 bags. There was meanwhile a smaller in number 3,932 bags decrease in the number of bags pending grading for this exchange; to register these pending grading stocks at 78,833 bags.
The commodity markets had a mixed day on Friday and with many of the U.S.A. based markets tending to be quiet ahead of the long weekend that comes with today’s Labour Day public holiday for the country, to see the overall macro commodity index taking a sideways track for most of the day. The Natural Gas, Cocoa, Cotton, Copper, Wheat, Soybean, Gold and Silver markets had a day of buoyancy, while the Oil, Sugar, Coffee and Corn markets had a softer day’s trade. The Reuters Equal Weight Continuous Commodity Index that is made up from 17 markets is 0.3% higher, to see this Index registered at 406.63. The day starts with the U.S. Dollar steady and trading at 1.295 to Sterling and at 1.189 to the Euro, while North Sea Oil is near to steady and is selling at $ 53.05 per barrel.
The London and New York markets started the day on Friday marginally south of par and with both the markets trading either side of par into the early afternoon trade, which seemed to set the pace for the day. As the afternoon both markets moved briefly moved up into positive territory before coming under pressure to move south of par and with a further short lived positive correction, prior to the markets taking a sideways modestly negative track through to the close.
The London market ended the day on a negative note and with 83.3% of the earlier losses of the day intact, while the New York market ended the day on a modestly negative note and with 35.3% of the earlier losses of the day intact. The New York market shall be close for the day and leaving the London market to trade solo for the day and one might expect to see little excitement for the market for the day and perhaps a hesitantly steady start for the day against the prices set on Friday, as follows:
LONDON ROBUSTA US$/MT NEW YORK ARABICA USc/Lb.
SEP 2071 – 5 SEP 127.75 – 0.40
NOV 2059 – 10 DEC 129.05 – 0.30
JAN 2035 – 8 MAR 132.65 – 0.20
MAR 2024 – 10 MAY 134.95 – 0.25
MAY 2031 – 9 JUL 137.30 – 0.25
JUL 2050 – 8 SEP 139.60 – 0.25
SEP 2055 – 7 DEC 142.90 – 0.20
NOV 2059 – 7 MAR 146.05 – 0.20
JAN 2065 – 7 MAY 148.00 – 0.20
MAR 2070 – 7 JUL 149.95 – 0.20
