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

Coffee Market Report

02 Sep 2019
The latest Commitment of Traders report from the New York arabica coffee market has seen the Non-Commercial Speculative sector of this market decrease their net short sold position within this market by 3.04%; over the week of trade leading up to Tuesday 27th. August; to register a new net short sold position of 46,149 Lots. This net short-sold position which is the equivalent of 13,083,037 bags has most likely been little changed, following the period of mixed but overall sideways trade that has since followed.

The latest Commitment of Traders report from the London robusta coffee market has seen the Speculative Managed Money Sector of this market decreased their net short sold position within the market by 4.98% over the week of trade leading up to Tuesday 27th. August; to register a short-sold position of 41,587 Lots. This net short sold position which is the equivalent of 6,931,167 bags has most likely been marginally decreased, following the period of mixed but overall more positive trade that has since followed.

Today is Labour day in the USA, which shall see the New York market closed for the day. Thus, one can expect little excitement for the London market trading solo for the day.

The November to December contracts arbitrage between the London and New York markets broadened on Friday; to register this at 36.34 usc/Lb. This equates to 37.52% price discount for the London Robusta coffee market.

The Certified washed Arabica coffee stocks held against the New York exchange were seen to decrease by 14,675 bags on Friday; to register these stocks at 2,332,924 bags. There was meanwhile a 8,903 bags increase to the number of bags pending grading for this exchange; to register these pending grading stocks at 16,361 bags.

The commodity markets were mixed in trade on Friday, with the overall macro commodity index tending softer for the day. The Cocoa, Coffee, Soybean and Silver markets ended the day on a positive note, while the Oil, Natural Gas, Sugar, Cotton, Copper, Orange Juice, Wheat, Corn and Gold markets ended the day on a softer note. The Reuters Equal Weight Continuous Commodity Index that is related to 17 markets is 0.44% lower; to see this index registered at 383.50. The day starts with the U.S. Dollar steady and trading at 1.216 to Sterling, at 1.099 to the Euro and with the US Dollar buying 4.144 Brazilian Real.

The London and New York markets started the day on Friday trading close to par, but with the London market tending mostly to the south of par, while the New York market was tending mostly to the north of par and with the markets holding this stance into the early afternoon trade. As the afternoon progressed the London market briefly dipped into negative territory but soon recovered, against more positive stance coming to the fore for the New York market. Both markets retained a positive stance for the rest of the days trade, albeit in a more muted manner for the London market.

The London market ended the day on a positive note and with 75% of the earlier gains of the day intact, while the New York market ended the day on a positive note, and with 82.1% of the earlier gains of the day intact. This close seemingly indicating something of a steady market for the present, is likely to inspire a follow through hesitant start for the London market in early trade today, against the prices set on Friday, as follows:

LONDON ROBUSTA US$/MT                         NEW YORK ARABICA USc/Lb.

SEP 1312 + 12                                                      SEP 93.60 + 1.70
NOV 1334 + 9                                                      DEC 96.85 + 1.60
JAN 1355 + 8                                                        MAR 100.30 + 1.50
MAR 1378 + 8                                                      MAY 102.55 + 1.40
MAY 1402 + 7                                                      JUL 104.70 + 1.35
JUL 1426 + 8                                                        SEP 106.65 + 1.30
SEP 1453 + 8                                                        DEC 109.60 + 1.30
NOV 1480 + 9                                                      MAR 112.50 + 1.25
JAN 1507 + 9                                                        MAY 114.50 + 1.20
MAR 1532 + 10                                                    JUL 116.45 + 1.15