I. & M. Smith (Pty) Ltd. since 1915


I. & M. Smith (Pty) Ltd.

Coffee Market Report

04 Apr 2022

The latest Commitment of Traders report from the New York arabica market has seen the Non-Commercial Speculative sector cut their net long position by 15.69% within the market over the week of trade leading up to Tuesday 29th. March 2022: to register a net long position of 15,734 lots, which is the equivalent of 4,460,519 bags. This net long position has most likely been little changed following the period of mixed but overall sideways trade that has since followed.

The Brazil government have reported that the country’s green coffee exports for the month of March were 641,550 bags or 15.93% lower than the same month last year, at a total of 3,385,200 bags. The official breakdown of coffee exports by description for March will soon be released and can be anticipated to illustrate this figure more accurately.

The May 2022 to May 2022 contract arbitrage between the London and New York markets widened on Friday to register this at 131.38 usc/Lb. This equates to 57.52% 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 4,726 bags on Friday, to register these stocks at 1,084,842 bags, with 95.08% of these certified stocks being held in Europe at a total of 1,031,508 bags and the remaining 4.92% being held in the USA at a total 53,334. Of this, a total 545,793 bags, or 50.31% of the coffees registered and stored in consumer country certified warehouses of the exchange, Brazil washed arabica, and a further 40.88% of these certified coffees, originating from Honduras. There were meanwhile a 9,526 bags decrease to the number of bags pending grading to the exchange; to register 21,066 bags pending grading on the day.

It was a softer day on the commodity markets on Friday, as recently released US jobs data underscored bets that the US Federal Reserve would potentially raise interest rates. The New York Arabica Coffee and Palladium markets ended the day on a positive note, while the Sugar, Cocoa, London Robusta Coffee, Corn, Soybean, Wheat, Gold, Silver and Platinum markets ended the day on a softer note. The day starts with the U.S. Dollar trading at 1.312 Sterling, at 1.105 the Euro and with the US Dollar buying 4.658 Brazil Real.

The New York market started the day on Friday trading to the south of par on a modest softer note, while the London market started the day trading on a modest firmer note, both markets would trade to either side of par during the early morning session before early support saw the markets trend in a positive direction. This momentum was carried through to the afternoon, whereby both the New York and the London markets were seen to hit a ceiling limiting the gains for the day’s trade. This saw both markets drop back from the highs of the day and trend back towards par. The New York market was seen to settle on a firmer note at the close with some of the earlier gains of the day intact, while the London market was seen to drop back and trade in softer territory late in the day to settle on a negative note at the close.

The London market ended the day on a negative note with 61.90% of the earlier losses of the day intact, while the New York market ended the day on a positive note with 50% of the earlier gains of the day intact. This mixed but mostly firmer close for the markets might indicate some degree of follow through momentum and direction to possibly set the markets for a steady start to early trade today, against the prices set on Friday, as follows:


MAY 2139 – 26                                          MAY 228.40 + 2.00
JUL 2130 – 22                                            JUL 228.45 + 2.00
SEP 2120 – 17                                            SEP 227.75 + 2.05
NOV 2113 – 11                                           DEC 225.50 + 1.80
JAN 2103 – 7                                              MAR 222.90 + 1.50
MAR 2100 – 7                                            MAY 220.80 + 1.25
MAY 2097 – 8                                            JUL 217.90 + 0.90
JUL 2094 – 10                                            SEP 214.60 + 0.45