The largest individual washed arabica coffee producer country, Colombia, is forecast to produce 12.20 million bags of coffee for the current October 2023 to September 2024 coffee year. Looking ahead to the forthcoming October 2024 to September 2025 coffee year, it has been forecasted that there will be an anticipated marginal 1.65% increase on that of the previous coffee production year, at a total of 12.40 million bags. The weather forecast models are predicting the La Nina weather phenomenon to possibly come to the fore toward the latter end of the calendar year, which would imply a potentially wet start to the October 2024 to September 2025 coffee year.

Within the largest producer country of this quality washed arabica producer sector, Honduras, the forecast is that the new crop to come from this washed arabica producer for the forthcoming October 2024 to September 2025 coffee year, is at an anticipated to remain stable from the current 2023/24 coffee production year. The new arabica crop which is due to start harvest toward the end of the year, is forecast to come in at 5.30 million bags, according to the latest forecast published by U.S. Department of Agriculture Global Agricultural Network. This country and others within the Central American producer block have experienced labour shortages in harvest season, as the pattern of migration from rural areas to urban environments accentuates the scarcity of available field workers over the sensitive timing of the annual harvest season in these countries. These countries for the most part continue the traditional and labour-intensive practice of selective hand harvest of ripe cherry, a practice that is an essential process in the production of high quality washed arabica production.

Mexico, independent forecasters estimate ahead of season that this producer will reach 3.35 million bags, or marginally higher than the current coffee year. The quality washed arabica coffee producer Guatemala is foreseen to be on par with their production in the current coffee year, and the forecast for the coming October 2024 to September 2025 coffee year to reach a total of 3.00 million bags. Other, neighbouring Central American washed arabica quality coffee producers, Nicaragua forecast to reach 2.52 million bags production, Costa Rica, estimated to reach 1.10 million bags, along with the approximate mostly steady 550,000 bags estimated to come from El Salvador.

The export season for Mexico and Central America is drawing to a close, with two months left of the current October 2023 to September 2024 coffee year. With news coming to the fore that coffee availability from these countries starting to tighten, earlier in the twelve-month export cycle than last year.

The Peruvian new crop washed arabica coffee year which spans from April 2024 to March 2025, was ahead of harvest forecast by the USDA to be potentially 0.50% larger than the previous crop and estimated to potentially reach 4.20 million bags. While internally, and as is a similar patten in Central America, domestic consumption is seen to be on the low side. In Peru local consumption is forecast at a relatively modest 240,000 bags, thus, releasing most new crop coffee to a relatively steady export flow to non-producer coffee consumer markets, and this country’s largest export market is consistently, the USA.

The Certified washed arabica coffee stocks held against the New York arabica market were seen to increase by 2,495 bags yesterday, to register these stocks at 814,801 bags, with 98.08% of these certified stocks held in, Europe at a total of 799,158 bags and the remaining 1.92% being held in the USA at a total 15,643 Bags. Of this, a total 412,981 bags, or 50.68% of the coffees registered and stored in consumer country certified warehouses of the exchange, are Brazil washed arabica, and a further 15.43% of these certified coffees, from Honduras. The pending grading stocks were seen to increase by 13,425 bags on the day; to register 26,330 bags pending grading on the day.

The September 2024 to September 2024 contract arbitrage between the London and New York markets widened yesterday, to register this at 35.35 Usc/Lb. This equates to 15.06% price discount for the London robusta coffee.

It was a mixed day overall on the commodity yesterday, with newly released economic data showing that the U.S. economy grew faster than expected in the second quarter and inflation pressures subsided, a consensus in the markets for the likelihood of a September interest rate cut from the Federal Reserve. The Coffee, Corn, Sugar and Soybean markets ended the day on a firm note, while the Cocoa, Wheat, Gold, Silver, Platinum and Palladium markets ended the day on a negative note. The day starts with the U.S. Dollar trading at 1.286 Sterling, at 1.086 the Euro and with the US Dollar buying 5.645 Brazil Real.

The New York and London markets started the day yesterday in muted volume, trading in softer territory respectively. The markets continued to trade around par before dropping into softer territory for the remainder of the morning session. The New York market pressured by long liquidation pushed below chart levels, to trigger buy stops to contribute a degree of resistance and buoyancy by midsession. The London market traded within a comparatively narrow range in positive territory before gaining support to track upward in a low volume morning trade setting. The arrival of the America’s at the start of their business day brought technical buying activity back to the floor and with the steady positive stance in London, the New York arabica market moved through par into positive territory for the rest of the session. The London robusta market followed suit to track firmer through the afternoon session. The New York market with spread activity prevalent to contribute toward the heavy volume posted on the day, failed to break through the next speculative chart gap higher, and both markets set the close on a firm note at the close, with most of the earlier gains of the day intact.

The London market ended the day on a positive note with 93.15% of the earlier gains of the day intact, while the New York market ended on a likewise positive note, with 82.56% of the earlier gains of the day intact. This firmer close for the markets, in fair volume in London and heavy volume in New York. One might think that the markets are due for a steady start to early trade today, against the prices set yesterday, as follows:

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

SEP         4395 + 68                                  SEP          234.70 + 3.55
NOV       4242 + 66                                  DEC         233.55 + 3.45
JAN        4066 + 60                                   MAR       232.15 + 3.35
MAR      3922 + 56                                   MAY       229.65 + 3.25
MAY      3817 + 56                                   JUL         227.50 + 3.25
JUL        3722 + 57                                   SEP         225.45 + 3.35
SEP        3642 + 55                                   DEC        222.95 + 3.35
NOV      3585 + 55                                   MAR       220.60 + 3.60