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


I. & M. Smith (Pty) Ltd.

Coffee Market Report

15 Apr 2019

11th. April, 2019.
The July to July contract arbitrage between the London and New York markets widened yesterday, to register this at 30.89 usc/Lb., while this equates to 31.93% price discount for the London Robusta coffee market.

The Certified washed Arabica coffee stocks held against the New York exchange reported a decrease to the number of bags pending grading for the exchanged yesterday, by 6,467 bags to set these certified stocks which are held within Certified warehouses in U.S.A. and Europe, at a total 2,485,169 bags. The number of bags pending grading for the exchange registered an increase by 320 bags; to register these pending grading stocks at 3,198 bags.

The results on the commodity markets were mixed yesterday, in a continuation of investor concern surrounding China/USA trade tensions in combination with the unresolved Brexit discussions resulting uncertainty. The European Central Bank stated an unchanged outlook and a steadfast policy while the US Dollar lost ground against a basket of other major currencies. It was a softer day for Cotton, Copper, Orange Juice, Wheat, Silver and Palladium markets. It was a positive day for the Oil markets, Coffee, Sugar, Cocoa, Corn, Soybean, Gold and Platinum. The Reuters Equal Weight Continuous Commodity Index that is made up from 17 markets is 0.335% higher on the day; to see this index registered at 412.40. The day starts with the U.S. Dollar trading at 1.307 to Sterling, at 1.128 to the Euro and with the US Dollar buying 3.857 Brazilian Real.

The coffee markets opened the day on a positive note with London slipping back to par in limited volume, New York held above par as the morning activity gathered pace. The midmorning session saw New York take a softer track and through par into negative territory, whereas London tread above par in very limited range. Lacking fresh fundamental news both markets driven by technical speculative investor and fund influence as first notice day approaches with fund rollover seemingly conveying the largest volume in New York. The afternoon progressed in positive territory in both markets though maintained within a narrow trading range. After a comparatively slow morning session New York gathered volume at the end of the day, to finish the day after a good volume day, as did London build on the volume toward the end of the day, the markets set the close yesterday, in positive territory, as follows:

London Robusta US$/MT New York Arabica Usc/Lb.

MAY   1,424 + 4                MAY   94.25 + 0.60
JULY  1,452 + 10              JULY   96.75 + 0.65
SEPT  1,470 + 15              SEPT   99.20 + 0.70
NOV  1,488 + 14               DEC 103.00 + 0.70
JAN   1,507 + 14               MAR 106.70 + 0.70
MAR 1,526 + 14               MAY 109.10 + 0.75
MAY 1,547 + 15               JULY 111.35 + 0.80
JULY 1,568 + 16               SEPT 113.45 + 0.80
SEPT 1,588 + 18               DEC 116.50 + 0.75
NOV 1,606 + 18               MAR 119.55 + 0.70