The analysts Safras & Mercado have reported than an estimated 48% of the new Brazil coffee crop has already been harvested. Based on their forecast for a new crop of 61.10 million bags, the report would indicate that so far approximately 29.35 million bags of the new crop coffee is harvested. The coffee made up of around 14 million bags of conilon robusta coffee, which starts harvest earlier in the seasonal year, and approximately 15.35 million bags of arabica coffee estimated to be harvested thus far.

Meanwhile weather conditions within Brazil are expected to remain cool and dry in the days to come, with temperatures in the mid to low teens in degrees Celsius. There has been a wet front forecast to reach the coffee growing belt during the second week of July however this is not expected to bring with it any substantial volume of rains and only scattered light showers in isolated areas, something that will be monitored by the market players in the days to come.

The Vietnam Customs Authority have reported that Vietnam’s coffee exports for the month of June have registered 3.50% lower from the previous month, at 2,290,050 bags. This number is proving to be slightly lower than the 2.47 million bags that had been initially forecast for the month’s coffee exports. This sees the cumulative export performance for the first nine months of the current October 2021 to September 2022 coffee year in Vietnam, the largest producer of robusta coffee at 2,696,950 bags or 13.92% higher than the same period in the previous year, at a total 22,066,467 bags.

The General Statistics office of Vietnam have at the same time reported the country’s coffee revenue value for the first six months of the 2022 calendar year, is reported at 48.50% higher than the same period in the previous year, at a total of approximately 2.30 billion US Dollars.

In the meantime, though and with good volumes of the past crop coffees already sold, there is evidence of price resistance within the internal market of Vietnam and with the farmers and internal traders holding back for higher value for their remaining stocks as internal demand continues to grow.

The current Indonesia April 2022 to March 2023 that is mainly made up of robusta coffees, is flowing to consumer markets, estimated by independent forecasters to potentially reach a total 10.60 million bags. This number made up of approximately 9.30 million bags of robusta coffee and 1.30 million bags of Arabica Coffee. There remains strong internal competition between this country’s domestic roasting and soluble manufactures and the export market, though the new crop is seen to be sufficient to allow this producer to continue to fuel their own strong domestic demand as well as to potentially increase exports to consumer markets.

The September 2022 to September 2022 contract arbitrage between the London and New York markets widened yesterday to register this at 130.72 usc/Lb. This equates to 59.72% price discount for the London Robusta coffee market. This wide arbitrage may be viewed by price sensitive roasters as an attractive alternative discount for Robusta against the comparatively higher value arabica coffee.

The Certified washed Arabica coffee stocks held against the New York exchange were seen to decrease by 8,768 bags yesterday, to register these stocks at 805,077 bags, with 93.39% of these certified stocks being held in Europe at a total of 751,858 bags and the remaining 6.61% being held in the USA at a total 53,219 Of this, a total 333,262 bags, or 41.40% of the coffees registered and stored in consumer country certified warehouses of the exchange, Brazil washed arabica, and a further 47.48% of these certified coffees, originating from Honduras. There was meanwhile a 6,720 bags decrease to the number of bags pending grading to the exchange; to register 3,200 bags pending grading on the day.

It was an overall firmer day on the commodity markets yesterday, with the leading in influence Oil market trending in a positive direction, supported by a pause in the US Dollars recent rally. The Sugar, Corn, Soybean, Wheat, Gold, Silver, Palladium and Platinum market ended the day on a firmer note, while the Coffee and Cocoa markets ended the day on a softer note. The day starts with the U.S. Dollar trading at 1.201 Sterling, at 1.015 the Euro and with the US Dollar buying 5.339 Brazil Real.

The New York and London markets started the day yesterday trading on a firmer note, the markets would oscillate around par for the remainder of the early morning session before finding some degree of support to trend in a firmer direction throughout the mid-morning session. As the afternoon progressed both the New York and the London markets buoyed by some degree of buying support moved in a positive direction, this saw both markets hit a ceiling for the day, limiting the gains to see the market capped. The New York and London markets dropped back from the mid-afternoon highs to trend back towards par during the late afternoon session. This saw both the New York and the London markets settle near to unchanged on the day, recovering most of the day’s lows.

The London market ended the day on a negative note with 68.75% of the earlier losses of the day intact, while the New York market ended the day on a likewise negative note with 35.29% of the earlier losses of the day intact. This follow through softer close for the markets, with the markets recovering most of the earlier losses of the day to settle near to unchanged for might indicate that the markets are due for a hesitant steady start to early trade today, against the prices set yesterday, as follows:

LONDON ROBUSTA US$/MT                NEW YORK USC/LB.

SEP 1944 – 11                                            SEP 218.90 – 0.30
NOV 1947 – 9                                            DEC 216.05 – 0.20
JAN 1943 – 8                                             MAR 213.30 – 0.15
MAR 1947 – 6                                           MAY 211.55 – 0.10
MAY 1941 – 5                                           JUL 210.15 + 0.05
JUL 1940 – 5                                             SEP 208.85 + 0.30
SEP 1940 – 5                                             DEC 207.70 + 0.55
NOV 1939 – 5                                           MAR 205.85 + 0.65