Wednesday 21 February 2024

Market reports and weather forecasts are sending coffee prices on a roller coaster ride

Must read

MILAN – Market and weather news are sending coffee futures prices on a roller coaster ride. Ice Arabica futures for December delivery recovered from a one-month low of $1.9965 per lb on Monday to a 4-week high of $2.1090 a tonne on Thursday. Robusta coffee futures prices for January delivery in London closed up $77 to a new contract high of $2,292.

Strength in the Brazilian real, that climbed to a 1-1/4 month high against the dollar, triggered short covering in Arabica coffee futures, whilst discouraging origin sales from Brazil’s coffee producers. Tightness in Robusta supplies and logistics bottlenecks are supporting prices in London.

A shortage of shipping containers has reduced Vietnam’s coffee exports. Shipments from the world’s biggest producer of Robusta coffee were 4.2% down in the Jan-Oct period to 1.29 MMT.

Vietnam’s new crop is expected to commence by late December, a month later than usual due to prolonged rains that hampered cherry picking and hurt bean quality, as well as new COVID-19 clusters.

Prices were also pushed higher by forecasts of the La Niña pattern strengthening over the next three months. A stronger La Nina phenomenon might lead to erratic weather with excessive rainfall or extended drought periods in the world’s coffee belt

Consultancies and analysts are publishing the early estimates for Brazil’s 2022/23 coffee season.

Dealers noted that 2022 was on-year in the Brazilian biennial crop cycle, which typically leads to significantly higher production.

Dear Reader,
you are not required to purchase anything for certain limited use of Comunicaffe International.
However, if you do not purchase a subscription, your access to our contents will be limited.
For further information about our subscriptions please visit the subscription page.


If you are already subscribed please type here your credentials:

Latest article