As active coffee traders, we at DRWakefield like to keep a close eye on the financial markets around the world to see how the price of the beans we source from many different countries is performing.
Between http://drwakefield.com/market-reports/coffee-market-report-6th-october-2014-to-10th-october-2014" target="" rel="">October 6th and October 10th, several conversion rate highs were recorded, although there were significant ups and downs throughout the week.
In the US, traders were waiting for the publication of the Federal Reserve's meeting minutes at the beginning of the week, which may have influenced their purchasing decisions. When these were released, they appeared to show that interest rates in the country would be remaining low for the time being to support the economy.
This did not affect the pound sterling to US dollar conversion rate though, as it rose to a high of $1.6226.
In addition, the euro to US dollar rate was not particularly affected either, with this in fact rising to its highest level for two weeks, at $1.2791.
Looking at the effect these currency fluctuations had on the coffee market, the value of Arabica beans varied throughout the five-day trading period, creating a somewhat unpredictable week for this coffee variety. On Monday, an increase in value of ten cents happened within just one minute, providing a dramatic moment for Arabica.
However, things were not quite so dramatic for Robusta beans, although their value dropped by $6 between Monday and Friday.
The world's biggest Robusta-producing country Vietnam is expected to export around 1.67 million 60 kg bags of these beans during October, so it will be interesting to see how this influences the market for this variety of coffee in the coming weeks and months.
With regard to futures, weather conditions in certain parts of the world affected the market, with our traders commenting: "Coffee futures surged to a 32-month high, as persistent drought curbs harvest prospects in Brazil, increasing the odds for higher retail prices."
