Coffee prices spiked on both exchanges as weather reports pointed to the possibility of drought in the Brazilian coffee belt in the next three months.
Robusta chart London July 2021 session on May 28, 2021
At the end of the last session of the week, Robusta coffee prices on the ICE Europe – London exchange continued to increase for the fourth session. Futures for delivery in July increased by 66 USD, to 1,583 USD/ton and for September delivery increased by 67 USD, to 1,605 USD/ton, a very strong increase. Trading volume very above average. Robusta – London prices hit a 2.5-year high.
Similarly, the price of Arabica coffee on the ICE US floor – New York has the same upward trend. The July spot futures rose 7 cents to 162.35 cents/lb and the September futures also increased 7 cents to 164.3 cents/lb, very strong gains. Trading volume is at “terrible”, rarely seen. Arabica – New York price rises to 4.5-year high.
The price of green coffee beans in the Central Highlands provinces increased by 900 – 1,000 VND, to range from 33,300 to 34,500 VND/kg.
Price of export Robusta coffee grade 2.5% black broken, stood at 1,625 USD/ton, FOB – HCM, with a plus difference at 20 USD/ton according to September futures prices in London.
The Reais gained 0.79%, the exchange rate rose to 1 USD = 5.2130 Reais, the highest level since April 11 as the USD gradually weakened against emerging currencies. While capital inflows from digital currency exchanges continue to decline as the regulatory barrier on this “virtual” currency continues to increase. The stock exchanges continued to benefit, while the gold price surpassed the $1,900 mark as speculated as speculative capital inflows sought shelter.
Coffee prices rebounded strongly on both futures exchanges due to concerns about adverse weather in Brazil. Weather reports forecast a three-month dry winter over the main coffee growing regions, creating favorable conditions for frost formation on upcoming full moon nights. This is an opportunity for “speculative bull” pushed the price up even though the net buying position on both exchanges is now very high.
Of note, Brazil is nearing completion of the Conilon Robusta crop with a strong forecast of production and is beginning to shift to harvesting early-ripening Arabica in the lowlands with a forecast of severe yield loss. However, the new crop also contributes to reducing supply pressure, the ICE-certified inventory report clearly shows this.
English (giacaphe.com)
