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Coffee Market Report 30th November to 4th December 2015

COFFEE MARKET NEWS Week Ending: 4th Dec 2015




3st Dec
























The 2015/6 crop deficit is down! Volcafe published a reduction of their estimate for the 2015/2016 deficit to 5.1 million bags, down from 6.4 million.


NYC climbed 730 points last week with speculative buying for short covering propelling Arabica coffee prices to 126.95 ending the week strongly.


The January delivery contract for Robusta Coffee at the London terminal settled a dollar lower to finish the week with a $21 dollar gain at $1,536. During the week we saw prices reach new contract lows entering the month at $1,467, and recovering $69, closing higher for three consecutive sessions.



Still hovering around the 1.5-1.51 mark. Strong labour market figures, together with comments from Janet Yellen, have provided further encouragement that the US Central Bank will move to hike rates before the end of the year, with the next policy meeting scheduled for 15 and 16 December. Many see the dollar strengthening and testing the 1.50 price floor that has proven resilient.


Thursday was all about the European Central Bank and their attempts to install growth into the European economy. Charging banks even more if they deposit funds with the ECB (a negative 0.3% rate) and injecting a further €360million into the Eurozone economy through Quantitative Easing measures don’t appear to have convinced markets. However the Euro did strengthen against both the Pound and US Dollar, just not as much as people had predicted.




Colombia will produce in 2015 some 14 million sacks of coffee, the country’s biggest harvest in the last 22 years, President Juan Manuel Santos said Friday in his speech at the closing ceremony of the National Coffee Growers Congress in Bogota.

Productivity is up, with production rising from 10 sacks per hectare (4 sacks per acre) in 2009 to more than 16 sacks per hectare (6.4 sacks per acre) in 2015. However, Juan Manuel Santos was quick to point out that there is still much room for improvement “We’ve made good progress, but we must admit we have a long way to go to catch up with competitors like Brazil and Vietnam, which produce between 40 to 60 sacks per hectare (16 to 24 sacks per acre),” he said. It was also announced last week that 8.1 million US dollars will be invested in helping coffee producers get access to the right fertilizers and get enough of them. Expect more coffee from Colombia!


Coffee & tourism. High-altitude coffee and tourism have formed an alliance in Honduras to promote the beverage’s consumption and the different attractions for visitors in the six regions where the aromatic bean is grown. In Capucas, Copan, visitors find impressive natural beauty and a climate that invites them to stay and learn how some of the best coffee is produced in Honduras, Central America’s top producer of the bean and the thirdleading grower in Latin America. One of the co-operatives we work with in Capucas, COCAFCAL cooperative, has built a complex of cabins for tourists, with two bedrooms, family room, bathroom, pools and trails through the plantations, and facilities for adventure sports, such as canopy tours. Perhaps this form of diversification might spread to other coffee growing areas?


In other news…

Flavor Activ have launched a green coffee cupping defect kit. They presented their product at the ICO (International Coffee Organization) last week. They work with the soft drink and alcohol industry and are looking to bring out more kits with more defects over the next few years!