The analysts Safras & Mercado have reported than an estimated total 92% 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 56.20 million bags of the new crop coffee have been harvested. The coffee made up of around 22 million bags of conilon robusta coffee, for which the harvest is complete, and approximately 34.20 million bags of arabica coffee estimated to be harvested thus far.

With just about all of the current crop robusta coffee stocks within Vietnam sold, the internal market prices are being seen to increase for what little remaining stocks are in hand. Within the Vietnam interior meanwhile, farmers will soon start to look toward the start of the new crop harvest. So long as weather conditions remain seasonally normal and conducive, the harvest can be expected to gradually start toward the end of the rain season, traditionally around October each year. This new October 2022 to September 2023 robusta coffee crop from Vietnam is forecast to be in the region of 30.50 million bags or 2.06% lower than the current October 2021 to September 2022 coffee year.

The September 2022 to September 2022 contract arbitrage between the London and New York markets narrowed yesterday to register this at 114.23 usc/Lb. This equates to 53.20% 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 increase by 15,433 bags yesterday, to register these stocks at 596,775 bags, with 92.89% of these certified stocks being held in Europe at a total of 554,347 bags and the remaining 7.11 % being held in the USA at a total 42,428 Of this, a total 161,182 bags, or 27.01% of the coffees registered and stored in consumer country certified warehouses of the exchange, Brazil washed arabica, and a further 59.14% of these certified coffees, originating from Honduras. There were meanwhile 15,688 bags decrease to the number of bags pending grading to the exchange; to register 210,441 bags pending grading on the day.

It was a softer day on the commodity markets yesterday, as the commodity markets came under pressure from a firmer US Dollar after the US Federal Reserve’s July meeting minutes indicated that there are further rate hikes to come. The Corn and Palladium market ended the day on a positive note, the Cocoa market remained unchanged on the day, while the Coffee, Sugar, Wheat, Gold, Silver and Platinum 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 5.166 Brazil Real.

The New York market started the day yesterday trading on a modest softer note, while the London market started the day trading on a firmer note. Both the New York and the London markets would be seen to take a firmer stance into the mid-morning session. The markets continued to move upward supported by some degree of buying, this saw both the New York and London markets hit a ceiling during the late morning session to limit the gains for the day. As the afternoon progressed, the markets dropped back to trend towards par. Pressured by selling, the New York and London markets trended in a negative direction. This saw the New York market continue lower to settle near to the lows of the day, while the London market recovered some of the earlier losses to settle on a near to unchanged note at the close.

The London market ended the day on a modest near to unchanged negative note with 33.33% of the earlier losses of the day intact, while the New York market ended the day on a likewise negative note with 88.71% of the earlier losses of the day intact. This follow through softer close for the markets and with the New York market losing ground late in the day to settle near to the lows of the day ahead of first notice day on the prompt month next week Tuesday 23rd August, one might think that the markets are due for little better than a hesitant start to early trade today, against the prices set yesterday, as follows:

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

SEP     2215 – 2                                          SEP      214.70 – 2.75
NOV     2218 – 6                                        DEC     211.85 – 2.55
JAN     2200 – 6                                           MAR     207.65 – 2.50
MAR    2172 – 8                                          MAY     205.05 – 2.50
MAY    2165 – 9                                       JUL      203.10 – 2.45
JUL 2157 – 8                                          SEP 201.65 – 2.55
SEP 2149 – 7                                         DEC 200.40 – 2.45
NOV 2125 – 7                                       MAR 198.95 – 2.45