Market Reports Blog / Market Reports / Market Report 26 to 30 August 2013

Market Report 26 to 30 August 2013

Coffee Prices, Futures and Currency close levels:

 

Monday

Tuesday

Wednesday

Thursday

Friday

NY Sep-13 c/lb

114.05

113.15

114.60

113.15

112.10

Lon Sep-13 $/t

1741

1751

1734

1730

1749

£/$

1.5566

1.5535

1.5517

113.34

112.51

 

Futures Markets:

Arabica:  ICE coffee futures dropped to a four-year low on Friday and the drop of the second position to below 1.35 could open potential for further declines towards the $1.10 level.  The bearish sentiment is due to a large off-year crop in Brazil, a recovery in Colombian output and the weak Brazilian real.  Selling by Brazilian producers also pushed prices lower.  The risk of frost in Brazil, which had provided modest support earlier in the week, has diminished as the winter ends.  New York was closed on Monday for Labor Day. 

Robusta:  Robusta futures for delivery in November rose 0.9% to $1,770 a tonne at the end of last week. Until lunchtime on Friday it looked as if it would be the fourth consequtive day of stagnant levels and early fund selling.  However, some midday buying pushed November through the 1768 marker and on to 1781, triggering buy stops and technical buying, resulting in a double of the volume traded on the day before.

Currency:  Economic confidence in the Eurozone reached a two-year high in August when the index of executive and consumer sentiment (HSBC) rose for the fourth month in a row.  In the UK, the Bank of England reported a five year high in lending to home-buyers.  In the US, consumer spending increased for the third consecutive month.  On the FX markets, GBP/USD slipped below $1.55 and EUR/USD fell to a four-week low of $1.3172.

Physical Markets:

Colombia: The agrarian strike is gaining momentum and its effect is being felt in the major cities.  Public transport has been suspended as has the movement of cargo between the coast and the interior.  Colombia’s coffee growers are organising protests to demand more government help to cope with low prices and rising costs.  Participants are the calling the action the ‘coffee dignity’ movement.

India: Coffee prices have edged up in India across the auctions.  Plantation PB levels rose 50 rupees per 50 kg as last week saw 63,000kg from the total 13,692kg available sold.  India’s coffee exports fell to 282,489 MT during the Oct 1 – Aug 30 period, compared to 300,493 the year before.

Costa Rica: Roya is attacking again.  Last year the country saw a 30% decrease in average rainfall, rising to 45% in 2013 and fuelling the spread of the disease.  The main regions affected are San Vito, Sabalito. Coto Brus and Turrialba.  Our sources inform us that most farmers have sold on a PTBF (price to be fixed) basis, and fear that if the market continues on the downward trend, they may have to abandon parts of their farms.

Indonesia: Coffee exports from the country’s main growing region, Sumatra are up 39% on the same month last year.  23,246 tonnes of robusta were shipped in August 2012.  Harvest began a month later than usual in Sumatra this year (May) due to wet weather.