COFFEE MARKET NEWS Week Ending: 6th February 2015
|GBP / USD
The calm before the storm…………?
We had a fairly quiet week that saw new 7 months and another bounce of the famous 160 level. Fundamentally we remain focused on Brazil weather but questionable rains forecasted for the end of February continue to keep the market on tender hooks waiting for the development phase of the crop.
Global coffee exports totalled 8.85 million 60-kg bags in December, up 0.2 percent from the same month in 2013(International Coffee Organisation.2015).
London was quite stable this week only about 15$/mt volatility during the week. Robusta coffee exports in December were 3.62 million bags, up from 3.29 million.
£/$ continues to strengthen day by day off recent lows that have not seen since the crash. The rise was boosted by UK services PMI which also helped the £/€ hitting a high of 1.3406.
Colombia – Colombia produced 1.1 million 60-kg bags of washed arabica coffee in January, an 8 percent increase from last year and highest output for the month in seven years, the private National Coffee Growers’ Federation said on Wednesday. Exports rose 10 percent in January to 1.065 million bags, the federation said. Earnings from January’s production almost doubled due to much higher arabica prices than last year coupled with a weaker Colombian peso.
India – India’s annual exports of coffee are set to drop by more than a tenth in the marketing year ending Sept. 30, hit by lower output of the arabica variety as farmers’ demand for higher prices erodes overseas competitiveness.
Indonesia – Robusta coffee bean exports from Indonesia’s main growing area in Sumatra fell 39 percent from a year ago to 9,101.4 tonnes in January, revised government trade data showed on Monday, and slipped 58 percent from December. Indonesia shipped 14,989.53 tonnes of robusta in the same month a year earlier and 21,673.4 tonnes in December.
Costa Rica – not much activities are going in that origin, as most of the coffee is sold out already, even if there are some left it has sky-high prices.
Nicaragua – Traders said Nicaragua’s 2014/15 crop is around three weeks behind schedule, leading to short-covering from exporters and importers who had promised customers coffee at lower differentials.
The country’s new crop, which generally begins harvesting in October, is projected to reach 1.61 million bags, a 7 percent increase from the prior year.