Coffee Market Report
The latest Commitment of Traders report from the London robusta coffee market has seen the Speculative Managed Money sector of this market increase their net short sold position within the market by 13.48% during the week of trade leading up to Tuesday 15th. January; to register a short-sold position of 26,841 Lots on the day. This net short position which is the equivalent of 4,473,500 bags has most likely been little changed to perhaps marginally decreased further, following the period of mixed but overall more positive trade that has since followed.
Meanwhile it is still proving difficult for the speculative and fund sectors of the market to assess their strategy in terms of speculative investment into the New York arabica coffee exchange, as it has now been a month since the last Commitment of Traders data from this market was reported for the figures for the 18th. December. These reports having been stalled with the U.S.A. Shutdown of the Federal Government and including the staff of the U.S. Commodity Futures Trading Commission, who have not been publishing the figures.
But one might guess that despite the clarity of these figures out of the volatile New York market, that the speculative and fund sectors of this market are still holding on to a significant net short sold position within this market. Albeit that the recent overall more positive trade might indicate that there has been some degree of short covering activity that might have reduced the net short sold positions of the Managed Money Funds and the Non-Commercial Speculative sectors of this market, which were 53,046 Lots and 60,900 Lots within the last report, respectively.
Today is the Martin Luther King Day holiday in the U.S.A. and this market shall be off the field of play for the day, which is likely to set the London market for something of a dull and low volume day of trade for the day. But with now only ten trading days ahead of the week long shut down of the Vietnam market for the countries Tet holidays, one might expect to see some price fixation activity for the London market coming to the fore.
The March to March contracts arbitrage between the London and New York markets broadened on Friday, to register this at 34.92 usc/Lb., while this equates to 33.27% 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 2,918 bags on Friday; to register these stocks at 2,476,755 bags. There was meanwhile a larger in number 12,827 bags increase to the number of bags pending grading for this exchange; to register these pending grading stocks at 51,541 bags.
The commodity markets had a mixed but mostly more positive day on Friday, to see the overall macro commodity index taking a positive track for the day. The Oil, Sugar, Coffee, Copper, Orange Juice, Corn and Soybean markets ended the on a positive note and the Wheat market was steady for the day, while the Natural Gas, Cocoa, Cotton, Gold and Silver markets ended the day on a softer note. The Reuters Equal Weight Continuous Commodity Index that is made up from 17 markets is 0.6% higher; to see this index registered at 405.62. The day starts with the U.S. Dollar near to steady and trading at 1.287 to Sterling, at 1.138 to the Euro and with the dollar buying 3.750 Brazilian Real.
The London market started the day on Friday on a softer note and the New York market on a positive note, but with the London market soon recovering to trade around par, while the New York market added some more value into the early afternoon trade. As the afternoon progressed the New York market started to trigger buy stops and to accentuate the gains and with the London market moving up into modest positive territory, but with the New York market that had peaked with gains of 3.80 usc/Lb. for the day hitting a ceiling and falling back in late trade.
The London market ended the day on a positive note and with 75% of the earlier gains of the day intact, while the New York market ended the day on a likewise positive note and with 67.1% of the earlier gains of the day intact. The New York market is close today and one might suspect that the London market shall be due for a slow and steady start for early trade today, against the prices set on Friday, as follows:
LONDON ROBUSTA US$/MT NEW YORK ARABICA USc/Lb.
JAN 1525 + 15 MAR 104.95 + 2.55
MAR 1544 + 9 MAY 108.05 + 2.50
MAY 1565 + 9 JUL 110.75 + 2.50
JUL 1582 + 7 SEP 113.45 + 2.40
SEP 1599 + 6 DEC 117.30 + 2.35
NOV 1618 + 6 MAR 121.05 + 2.30
JAN 1635 + 5 MAY 123.35 + 2.20
MAR 1655 + 5 JUL 125.50 + 2.20
MAY 1675 + 5 SEP 127.60 + 2.20
JUL 1691 + 5 DEC 130.65 + 2.25
