Saturday 13 April 2024
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Coffee futures prices reach a new contract high in London, New York rallies on Brazil’s dry weather, real’s strength

In London, March Robusta rose by 4.5% over the week to finish Friday (0.6%) at $3,269 after setting a contract high of $3,325. Robusta coffee futures prices continue to be affected by lower crops in Vietnam and Indonesia as well as by the logistic problems caused by the attacks on shipping in the Red Sea

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DESCAMEX COFFELOVERS 2024
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MLAN – Coffee futures prices rose sharply in New York during the last session of the week. The most active contract for March delivery posted a 690 point gain on Friday closing at a one-month high of 193.85 cents per lb. The “C” Contract in New York rallied as updated weather forecasts reduced the chances for rain in Brazil’s coffee-growing regions.

Dealers noted recent rains had mostly been in the northern half of Brazil’s coffee belt, though forecasts suggested there were likely to be showers in central areas in early February.

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Strength in the Brazilian real also supported Arabica coffee as the real on Friday climbed to a 1-1/2 week high against the dollar. Furthermore, Saxo Bank, in a report, noted that a lack of containers in Brazil was leading to port congestion.

In London, March Robusta rose by 4.5% over the week to finish Friday (0.6%) at $3,269 after setting a contract high of $3,325.

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Robusta coffee futures prices continue to be affected by lower crops in Vietnam and Indonesia as well as by the logistic problems caused by the attacks on shipping in the Red Sea.

Both markets also continue to be underpinned by a low level of certified stocks.

In other news, coffee shipments from Brazil reached 4.3 mln bags in December, according to Secex. This corresponds to an increase of 30% compared to the same period last year, says Safras & Mercado in a report commenting the figures.

The acceleration of shipments in December improves performance throughout the 23/24 season (Jul/Jun), with accumulated shipments between July and December totalling 22.48 million bags. An increase of only 4% compared to the same period last season.

“This slower-than-expected flow of shipments over the season, associated with the larger crop, reinforces the idea of higher stocks in the producers’ hands, particularly of Arabica coffee. This must be taken into account in selling strategies, especially when aiming at the transition period between seasons.”

In 2023, coffee shipments totalled 38.7 million bags, and revenue reached USD 7.99 billion. Secex data indicates declines of 1% in volume and 13% in revenue compared to 2022.

The official numbers were slightly below Cecafé’s indications, which indicated coffee shipments in 2023 at 39.2 million bags. Highlight on conillon exports, which totalled 4.7 million bags, which corresponds to an increase of 212% over the 1.51 million bags shipped in 2022.

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