Risk aversion at the prospect of an increase in the basic USD interest rate caused the commodity market to plunge…
Robusta chart London 3/2022 session on January 10, 2022
At the end of the first session of the week, the price of Robusta coffee on ICE Europe – London reversed to decrease. The March spot term fell by $56 to $2,260/ton and the May delivery term fell by $55 to $2,211/ton, sharp declines. Trading volume above average.
Similarly, the price of Arabica coffee on the ICE US floor – New York trended down. Futures for delivery in March fell 3.55 cents to 234.90 cents/lb and futures for May delivery fell 3.35 cents to 234.95 cents/lb, significant reductions. Trading volume remained very above average.
The price of green coffee beans in the Central Highlands provinces decreased from 1,000 to 1,100 VND, to range from 40,200 to 40,700 VND/kg.
Price of exported Robusta coffee grade 2.5% black broken, stood at 1,961 USD/ton, FOB – HCM, with a deduction of about 240 – 250 USD/ton according to the May futures price in London.
The reais fell 0.74%, the exchange rate fell to 1 USD = 5.6740 Reais after the negative impact from the Fed – US announcement of the minutes showing that the monetary tightening will be sooner than the market expected. The increased risk aversion and the drop in US stocks caused speculation to adjust positions, shifting capital flows to seek safe havens.
The price of coffee on the two floors dropped sharply when new crops from many major producing countries began to enter the market. The main coffee growing regions in southern Brazil have abundant rainfall, favorable for the favorable development of coffee berries, promising high yields, while this year’s crop is still the year. “good season” cyclical “two years one”. It seems that the concerns of drought from early last year and the damaging frosts of July are no longer mentioned.
The market concern is that the harvest of the new Brazilian crop will begin in April in the Conilon Robusta growing region and July in the Arabica growing region. However, Brazilians often sell goods under the futures contract, especially when the current high price of two futures exchanges motivates them to sell strongly. Combined with the increased selling of new crop hedges from the main producing countries, Robusta coffee prices returned to standing at a one-month low.
ANhan Van (giacaphe.com)
