The inverse price structure was pushed up very high to attract speculation and quickly brought coffee to the two auction floors…
Ending the last session of the week, the price of Robusta coffee on the ICE Europe – London floor extended the fourth session’s gain. Futures for delivery in January increased by 51 USD, to 2,386 USD/ton and term for delivery in March increased by 33 USD, to 2,298 USD/ton, strong increases. Trading volume very high above average. The island price structure widens the gap.
Similarly, the price of Arabica coffee on the ICE US floor – New York tended to increase for the third session. March spot futures added 6.75 cents to 243.35 cents/lb and May delivery added 6.60 cents to 242.40 cents/lb, strong gains. Trading volume above average. The island price structure widens the gap.
The price of green coffee beans in the Central Highlands provinces increased by 300-400 VND, up to range from 42,600 to 43,000 VND/kg.
The price of exported Robusta coffee, 2.5% black broken, stood at 2,018 USD/ton, FOB – HCM, with a deduction of about 250 – 280 USD/ton according to the March futures price in London.
The reais fell 0.31%, the exchange rate fell to 1 USD = 5.6770 Reais due to the impact of the foreign exchange market as USDX rallied after disappointing US jobs were very low than expected. The concern of excessively high inflation pushed the Fed – US to raise the basic interest rate sooner than expected, while the economy still showed positive signs for Copom – Brazil to raise the basic interest rate in Reais at the main meeting. Monetary policy at the end of this year also contributed to the high prices of many agricultural products.
The upward price trend on the world coffee markets seems to be inevitable when the two futures exchanges have established an inverse price structure with the monthly futures price for near delivery higher than the futures futures price. This contributes to confirming that the short-term supply for consumption markets is really in serious shortage. At this time, the market needs a lot of coffee to bring to the two auction floors, with prices nearly 80% higher than the beginning of the year to support logistics problems under the strong negative impact of the covid-19 pandemic. 19.
Coffee growers are not really excited when futures prices go up just to partially compensate for shipping costs, while they have to pay for harvesting and input materials also skyrocketing.
ANhan Van (giacaphe.com)