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Weekly Market Report 23 to 27 July 2012

Futures Markets:

Arabica : NY Prices retracted from recent highs as a result of further fairly positive news, regarding the Brazilian crop worries. The consensus seems to be that there has been damage to the crop relating to a quality issue rather than any reduction in overall output. Although, we may see a strengthening of differentials for Fine Cups and other origins quality “milds”.        

Robusta : Liffe continues to plow its own furrow. Prices rocket to two month highs as huge U.S and European roasters just cannot get the coffee quick enough from origin. Vietnam, create a seller’s market as stocks in Europe cannot meet demand.  

Currency :  Sterling enjoys a much welcomed Olympic bounce against the Dollar and Euro.

Futures and Currency close levels:







NY Sep-12 c/lb






Lon Sep-12 $/t













Physical Markets:


Brazil : Sales of Brazil's 2012/13 coffee crop have reached 20 percent of this season's expected output that should total 54.9 million 60-kg bags

Guatemala: A fast-spreading strain of leaf rust, one of the world's most devastating coffee diseases, could hit Guatemala's next coffee crop and damage up to 10 percent of production, the president of the country's coffee growers' association Anacafe said on Thursday. Since the last harvest, which ended in April, growers have been battling a new form of leaf rust fungus, or roya, that kills leaves on coffee trees, sapping them of nutrients so the weakened plants produce fewer beans. The upcoming 2012/13 harvest is set to begin in October and Guatemala faces a drop of up to 10 percent in output if farmers do not act in time to combat the disease.  Nearly 40 percent of the nation's some 680,000 acres (274,000 hectares) of planted coffee land was hit by roya in the 2011/12 season, partially or completely damaging fields.   

Tanzania: Expects that its 2012/13 (June/April) coffee output to rise 72 percent to 55,000 tonnes, helped by good rainfall.

Vietnam: Already the world's biggest producer of robusta coffee, plans to expand its planting area for arabica in a bid to more than double output of the superior-quality bean to 96,000 tonnes by 2020, though industry officials said production could be even higher. The Southeast Asian nation, the world's No.2 coffee producer after Brazil, will expand its northern and central arabica area to 40,000 hectares (99,000 acres) over the next eight years, an Agriculture Ministry official said.

Central America: Coffee exports from Central America, Mexico, Colombia, Peru and the Dominican Republic rose 22.5 percent in June compared to the same month last year,

Other News: Peet's Coffee & Tea Inc said on Monday it struck a deal to be acquired by Joh. A. Benckiser for about $1 billion, a move that will give Peet's a financial jolt as it competes against larger coffee and tea shops and will broaden the reach of Germany's Reimann family in the coffee business.