The latest Commitment of Traders report from the New York arabica coffee market has seen the shorter term in nature Managed Money fund sector of this market switch their net long position to a new net short position within this market over the week of trade leading up to Tuesday 1st. November 2022; to register a new net short position at 10,386 Lots. Meanwhile the longer term in nature Index Fund sector of this market cut their net long position by 0.36% within the market, to register a new net long position of 35,354 Lots on the day.    

Over the same week, the Non-Commercial Speculative increase their net short position by 373.09% within the market over the week of trade leading to Tuesday 1st. November 2022: to register a net short position of 14,590 lots, which is the equivalent of 4,136,200 bags. This net short position has most likely been marginally extended, following the period of mixed but overall sideways trade that has since followed.

The Vietnam Customs Authority have reported that Vietnam’s coffee exports for the month of October have registered 13.70% lower from the previous month, at 1,330,550 bags. This number is proving to be on par with the 1.33 million bags that had been initially forecast for the month’s coffee exports.  This sees the cumulative export performance for the first ten months of the 2022 calendar year in Vietnam, the largest producer of robusta coffee at 10.80% higher than the same period in the previous year, at a total 23,333,333 bags.

The General Statistics office of Vietnam have at the same time reported the country’s coffee revenue value for the first ten months of the 2022 calendar year, is reported at 33.70% higher than the same period in the previous year, at a total of approximately 3.30 billion US Dollars.

The December 2022 to January 2023 contract arbitrage between the New York and London markets narrowed yesterday to register this at 86.59 usc/Lb. This equates to 50.77% 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 18,652 bags yesterday, to register these stocks at 406,638 bags, with 86.90% of these certified stocks being held in Europe at a total of 353,360 bags and the remaining 13.10% being held in the USA at a total 53,278. Of this, a total 253,546 bags, or 62.39% of the coffees registered and stored in consumer country certified warehouses of the exchange, Brazil washed arabica, and a further 30.58% of these certified coffees, originating from Honduras. There was meanwhile a 15,913 bags decrease to the number of bags pending grading to the exchange; to register 155,852 bags pending grading on the day.

It was a mixed day on the commodity markets yesterday, as macroeconomic data and inflation concerns weigh on sentiment and influence speculative direction within the markets. The Cocoa, Gold, Platinum and Palladium markets ended the day on a positive note. The Coffee, Sugar, Corn, Soybean, Wheat and Silver markets ended the day on a softer note. The day starts with the U.S. Dollar trading at 1.149 Sterling, at 1.000 the Euro and with the US Dollar buying 5.157 Brazil Real.

The New York market started the day yesterday trading on a modest near to par softer note, while the London market started the day trading to the north of par on a modest firmer note. Both the New York and the London markets oscillated around par for the remainder of the early morning session, before taking a softer track into the mid-morning session. The late morning session saw the markets continue to project lower, trending in a softer direction pressured by some degree of selling in the market. As the afternoon progressed, both the New York and the London came under severe selling pressure. The markets continued to project lower with further long liquidation selling to accentuate the losses for the day’s trade. Late in the day both the New York and London markets would hit a floor, before finding support to recover some of earlier losses of the day. This saw both the New York and the London market settle on softer notes respectively at the close.

The London market ended the day on a negative note with 50% of the earlier losses of the day intact, while the New York market ended the day on a likewise negative note with 55.91% of the earlier losses of the day intact. This very soft close for the markets, albeit that the New York and London markets recovered around half of the earlier losses of the day during a relatively heavy trade volume day, might see the markets set 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.

JAN     1851 – 18                                      DEC    170.55 – 5.20
MAR   1833 – 17                                      MAR   166.05 – 5.60
MAY   1820 – 15                                      MAY   164.90 – 5.30
JUL     1813 – 14                                      JUL     163.90 – 5.05
SEP     1807 – 13                                      SEP     162.85 – 4.95
NOV   1800 – 12                                      DEC    161.80 – 4.70
JAN    1807 – 14                                      MAR   161.90 – 4.45
MAR  1815 – 14                                      MAY    162.05 – 4.35