The Uganda Coffee Development Authority has reported that the countries coffee exports of the month of July were 134,231 bags or 33.33% lower than the same month last year, at a total of 268,490 bags. This dip in export performance does however follow many months of positive performance earlier in the year.

Therefore, the relatively sharp dip in the volume of coffee exports in July contributes to the countries cumulative coffee exports for the first ten months of the present October 2015 to September 2016 coffee year to be only marginally 32,314 bags or 1.13% lower than the same period in the previous coffee year, at a total of 2,816,619 bags.

This decline in the overall Ugandan coffee exports for the first ten months of the present coffee year is however mostly related to the climatic problems that have affected the central robusta coffee districts of the country, as while the arabica coffee exports over this ten-month period were in fact 19.32% higher, the robusta coffee exports were 7.12% lower for the period. While the ration of arabica to robusta coffee exports was 27.32 to 72.68, as against a ratio of 22.64 to 77.36 over the same period in the previous coffee year.

The Uganda Coffee Development Authority have likewise forecasted that they foresee the month of August to be another poor coffee export performance month, but perhaps more critical of the present in the decline in value of the coffee exports. As despite the improved performance of the relatively higher value arabica coffees for the first ten months of the present coffee year, the value of these exports is US$ 74,468,759.00 or 21.36% lower than the value of the coffee exports over the same period in the previous coffee year, at a total of US$ 274,194,226.00.

The largest coffee cooperative in Brazil Cooxupe have reported that as at Friday last week their members who are arabica coffee farmers in the states of south Minas Gerais and Sau Paulo had harvested 87% of their new crop, as opposed to a 79% factor at the same time last year. Thus indicating that the new arabica coffee crop harvest is well on track to be complete within the next couple of weeks.

In the meantime, the Brazil coffee export house Exportadora Guaxupe have reported that with the new Brazil crop almost complete, that they forecast that this new crop shall bring in 56 million bags of coffee. This is a number that is at the higher end of the range of new crop reports, which tended to take some of the wind out of the sails of the speculative bulls within the New York market yesterday.

Exportadora Guaxupe did however, match many other forecasts that due to biennial bearing factors and following this year’s good arabica coffee crop, that next year’s crop shall be potentially a smaller crop. Thus with the need for Brazil to rebuild the much depleted arabica coffee stocks that were mostly liquidated over the past two years of relatively modest arabica coffee crops, the report could not be seen to be completely bearish towards the fortunes of the market on the longer term.

The November to December contracts arbitrage between the London and New York markets narrowed yesterday, to register this at 61.00 usc/Lb., while this equates to a 42.63% price discount for the London robusta coffee market. This arbitrage remaining relatively attractive to roasters in comparison to arabica coffee prices, continues to inspire support for the robusta coffee sector of the industry.

The Certified washed Arabica coffee stocks held against the New York exchange were seen to increase by 1,220 bags yesterday; to register these stocks at 1,284,134 bags. There was meanwhile a larger in volume 2,165 bags decrease to the number of bags pending grading for this exchange; to register these pending grading stocks at 7,535 bags.

The commodity markets experienced a softer day yesterday, to see the overall macro commodity index taking a softer track for the day. The Natural Gas and Orange Juice markets nevertheless bucked the trend to have a positive day’s trade and the Corn market was steady, while the Oil, Sugar, Cocoa, Coffee, Cotton, Copper, Wheat, Soybean, Gold and Silver market had a softer day’s trade. The Reuters Equal Weight Continuous Commodity Index that is made up from 17 markets is 1.12% lower; to see this Index registered at 419.63. The day starts with the U.S. dollar steady and trading at 1.322 to Sterling and 1.127 to the Euro, while North Sea Oil is showing a degree of buoyancy in early trade and trading at 47.95 per barrel.

The London market and New York markets opened the day yesterday on a hesitantly steady note and with the London market trading near to par, while the New York market remained within a narrow range either side of par into the early afternoon trade. The afternoon brought with it some pressure for the New York market fell back into negative territory, while the London market moved to take a modestly buoyant sideways track to the positive side of par. The negative influences of the softening nature of the macro commodity index and good crop forecasts out of Brazil seemingly had their influence and the New York market came under pressure and with sell stops being triggered, took a sharp negative track and with the more fundamentally stable London market moving back into negative territory. The London market continued to end the day on a soft note and with 57.9% of the earlier losses of the day intact, while the New York market ended the day on a very soft note and with 83% of the earlier losses of the day intact. This overall soft close that contributes to a negative technical picture for the markets is unlikely to inspire little better than a near to steady start for the markets for early trade today against the prices set yesterday, as follows:

LONDON ROBUSTA US$/MT     NEW YORK ARABICA USc/Lb.

SEP 1779 – 12                                 SEP 142.15 – 3.15
NOV 1810 – 11                               DEC 143.10 – 4.15
JAN 1834 – 10                               MAR 146.30 – 4.15
MAR 1848 – 10                              MAY 148.20 – 4.15
MAY 1861 – 10                                JUL 149.85 – 4.15
JUL 1873 – 10                                  SEP 151.35 – 4.20
SEP 1885 – 10                                 DEC 153.35 – 4.25
NOV 1898 – 10                              MAR 155.30 – 4.30
JAN 1907 – 10                               MAY 156.40 – 4.25
MAR 1944 – 10                               JUL 157.40 – 4.25