These activities are meanwhile continuing to inflate asking differentials for new robusta coffee business from not only from the Vietnam exporters but also with consumer industries maintaining a reverse price resistance hand to mouth buying policy and chasing nearby supply to fill the gaps from all robusta producers, similarly inflated exporters asking differentials for robusta coffees in general. These activities are therefore limiting the volumes of new robusta coffee business and the related price fixation hedge selling against the London market and with trade and roaster demands upon alternative supply from the certified stocks held against the London market, it is inflating the value of the prompt month within the London market and creating a degree of buoyancy for this market.

The big question is how long shall the farmers and internal traders within Vietnam hold out, as there is something of a cut off time in terms of the new and forecasted to be potentially larger new crop that is due to start being harvested at the end of the summer rain season, in October. This factor is very much in mind with the consumer industry buyers who are by nature differential focused in terms of their pricing and are tending as they head into the slower summer roasting season for the main northern hemisphere markets, to hold back from all but need to have new purchases.

Thus with the prevailing short term artificially tight short term supply of robusta coffees one might guess that ultimately on the medium term the muscle still remains with the consumers and that perhaps by late August the farmers and internal traders within Vietnam might need to bite the bullet, and start to become more aggressive sellers of their substantial stocks of robusta coffee. Meanwhile the related buoyancy within the London robusta coffee market is seemingly having some influence to counter the negative nature of the charts for the more volatile New York market and with similarly some degree of internal market price resistance being shown by arabica coffee farmers in Brazil and many other leading arabica coffee producers, one might suspect that both markets might be able to show a degree of buoyancy.

The arbitrage between the markets has broadened yesterday to register this at 52.44 usc/Lb., while this equates to an attractive 39.73% price discount for the London robusta coffee market. This arbitrage continues to inspire consumer market roaster interest in robusta coffees, which assist to take some of the bite out of the comparative firm arabica coffee prices.

The Certified washed Arabica coffee stocks held against the New York exchange were seen to decrease by 4,114 bags yesterday; to register these stocks at 2,124,660 bags. There was meanwhile a larger in volume 9,519 bags increase to the number of bags pending grading for this exchange; to register these pending grading stocks at 50,641 bags.

The commodity markets were in receipt of mixed signals yesterday, with some concerns over more modest housing sales tending to fuel speculation over delays in the rise of the U.S. interest rates having some influence. While the somewhat aggressive and resistant stance being taken by the Greek government towards economic reforms, is impacting upon confidence within the Euro zone. Thus the markets and with many players awaiting tonight’s announcement by the U.S. Federal Reserve, took a generally sideways track for the day yesterday, with the macro commodity index trading either side of par for the day. The U.S. Oil, Cocoa, Coffee, Cotton, Corn and Soybean markets had a day of buoyancy, while the Brent Oil, Natural Gas, Sugar, Copper, Orange Juice, Wheat, Gold, Silver and Platinum markets had a softer day’s trade. The Reuters Equal Weight Continuous Commodity Index that is made up from 17 markets is 0.27% higher to see this Index registered at 420.21. The day starts with the U.S. Dollar steady and selling at 1.563 to Sterling and 1.125 to the Euro, while North Sea Oil is tending softer in early trade and is selling at 60.65 per barrel.

The London market shrugged off the negative influences of the sharply softer end to the day for the New York market on Monday and opened the day yesterday with buoyancy, which assisted to buoy spirits for the New York market that likewise started the day with a degree of buoyancy. Both markets retained their muscle and took a positive track into the afternoon trade and with the London market in particular, showing some good gains. There was however something of a ceiling for both the markets and with selling pressure coming into play and to limit the gains, through the day. The London market ended the day on a positive note and with 76.9% of the gains of the day intact, while the New York market ended the day on a likewise positive note and with 64.1% of the earlier gains of the day intact. This close and with yesterday’s buoyancy somewhat supportive for sentiment is likely ahead of the London options due to close later in the day likely to inspire a cautiously hesitant and steady start for both markets for early trade today against the prices set yesterday, as follows:

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

JUL 1793 + 38                             JUL   129.35 + 1.55
SEP 1754 + 20                             SEP   132.00 + 1.70
NOV 1771 + 21                           DEC  135.65 + 1.70
JAN 1789 + 23                            MAR 139.30 + 1.75
MAR 1811 + 22                          MAY 141.50 + 1.70
MAY 1831 + 22                            JUL 143.35 + 1.80
JUL 1849 + 18                              SEP 144.80 + 1.85
SEP 1871 + 19                             DEC 146.80 + 1.85
NOV 1891 + 19                           MAR 148.95 + 1.85
JAN 1914 + 19                            MAY 150.45 + 1.85