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


I. & M. Smith (Pty) Ltd.

Coffee Market Report

18 Jun 2020

The September to September contract arbitrage between the London and New York markets widened yesterday; to register this at 42.64 usc/Lb. This equates to 43.44% price discount for the London Robusta coffee market.

The Certified washed Arabica coffee stocks held against the New York exchange were seen to increase by 2,384 bags yesterday; to register these stocks at 1,668,120 bags, with 91.8% of these certified stocks being held in Europe at a total of 1,530,812 bags and the remaining 8.2% being held in the USA at a total of 137,308 bags. There was meanwhile a larger in number 12,000 bags decrease to the number of bags pending grading for this exchange; to register these pending grading stocks at 35,890 bags.

The Certified Robusta coffee stocks held against the London exchange have been reported to decrease by 39,500 bags over the weeks of trade leading up to Monday 15th. June, to see these stocks registered at 2,007,167 bags, on the day.

It was a modest day overall on the commodity markets yesterday, to see the overall macro commodity index taking something of a sideways track for the day. The Coffee markets ended the day on a positive note, while the Sugar and Cocoa markets ended the day on a softer note. The Reuters Equal Weight Continuous Commodity Index that is related to 17 markets is 0.2529% higher; to see this index registered at 359.1331. The day starts with the U.S. Dollar steady, trading at 1.255 to Sterling, at 1.125 to the Euro and with the US Dollar buying 5.229 Brazilian Real.

The London and New York markets started the day yesterday trading on a modest positive note, both markets maintained this relatively firm track into the early afternoon trade. As the afternoon progressed both the New York and London markets started to attract selling pressure to drop off the highs of the day, late in the day both markets gained momentum to remain buoyant and to see the London market close on a modest positive note for the day and the New York market close on a firm positive note for the day.

The London market ended the day on a modest positive note and with 27.78% of the earlier gains of the day intact, while the New York market ended the day on a likewise positive note and with 81.25% of the earlier gains of the day intact. This firm close and with the New York market gaining momentum late in the day might inspire some degree of confidence to possibly set the markets for a hesitant steady start to early trade today, against the prices set yesterday, as follows:

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

JUL 1150 + 2                                                                             JUL 96.25 + 2.60
SEP 1182 + 5                                                                             SEP 98.15 + 2.55
NOV 1200 + 4                                                                            DEC 100.30 + 2.50
JAN 1221 + 5                                                                             MAR 102.40 + 2.45
MAR 1242 + 6                                                                           MAY 103.80 + 2.40
MAY 1262 + 5                                                                           JUL 105.20 + 2.30
JUL 1281 + 2                                                                             SEP 106.45 + 2.20
SEP 1297 Unch                                                                          DEC 108.10 + 2.05