Concerns that the rainy weather forecast in southern Brazil is uncertain, while inventory levels in major consumer markets continue to decline has prompted funds and speculators to return to markets to increase buying…
At the end of the weekend trading session, Robusta coffee prices on ICE Europe – London extended their increasing streak. The March delivery term increased by 18 USD, to 3,269 USD/ton and the May delivery term increased by 27 USD, to 3,112 USD/ton, very significant increases. Trading volume is very high above average.
Similarly, Arabica coffee prices on ICE US – New York exchange returned to an upward trend. March delivery futures increased 6.90 cents, to 193.85 cents/lb and May delivery futures increased 5.75 cents, to 189.45 cents/lb, strong increases. Trading volume remains well above average.
The price of green coffee in the Central Highlands provinces increased by 800 – 1,000 VND, fluctuating in the range of 75,900 – 76,500 VND/kg.
DXY decreased slightly after reporting that newly released US economic data showed faster-than-expected growth in the fourth quarter of 2023, creating conditions for speculation about the possibility that the Fed will change its financial strategy in the coming months. The first quarter of this year caused the majority of investors to still stand outside most markets due to increased risk concerns.
However, coffee prices had a rather busy day as transportation from producing countries to consuming regions became more difficult on two of the world’s vital maritime routes. South Pacific and Oceania routes are limited due to low water levels in the Panama Canal. Meanwhile, the Asia-Europe route was hit by terrorist missiles in the Red Sea area while passing through the Suez Canal, forcing changes to schedules and shipping routes, making costs many times more expensive.
These restrictions and delays are contributing to major volatility in coffee markets, in a context where inventories in major consuming markets are already lower than average.
Although the weather forecast in the main growing areas in the south of Brazil is about to bring heavy rain, it is not certain that nothing unusual will happen, continuing to support the speculative psychology that has helped coffee futures prices on the New York floor. Reversing and recovering strongly due to concerns about crop yield in 2024.
English (giacaphe.com)
