High risk aversion, before the possibility that central banks will adjust monetary policies, has spurred speculation on liquidation of net positions, causing coffee prices on the two futures exchanges to continue to weaken…
Robusta London chart July 2022, week 23 (from 06/06/2022 – 11/06/2022)
For the whole week of 23, London market had 5 consecutive decreasing sessions. The price of Robusta coffee for July delivery fell all of $59, or 2.76%, to $2,177 per ton, and September delivery fell all of $44, or 2.06%, to $2,095. /ton, the reductions are very significant. Trading volume above average.
On the contrary, the New York market had 2 gaining sessions and 3 decreasing sessions. The price of Arabica coffee for July delivery fell all of 3.50 cents, or 1.51%, to 228.90 cents/lb and for September delivery fell all of 3.75 cents, or 1. 61 %, to 228.80 cents/lb, the reductions are quite significant. Trading volume very above average.
The price of green coffee beans in the Central Highlands market decreased by 900 – 1,000 VND, to fluctuate in the range of 40,800 – 41,300 VND/kg.
Reais exchange rate weakened again, supported Brazilians to boost sales of the new crop, causing coffee prices on both futures exchanges to drop consecutively.
The decline in coffee prices was also due to the expiration of the options contract and the nearing the first notice date (FND) of the July term, prompting speculators to adjust and balance their net positions.
The reason for the decline is also the concern that the risk of increasing when global inflation exceeds will prompt major central banks in the world to cut economic stimulus measures and raise the monetary base interest rate to reduce the risk of inflation. Preventing inflation also causes speculation to buy goods in general.
According to the report of the consultant – analyst Safras & Mercado, so far Brazil has sold about 24% of the new crop being harvested, this year’s crop is estimated at about 61.10 million bags of coffee of all kinds.
The highlight of the week is the Coffee Exporters Association of Brazil May Coffee Export Report (commonly referred to as Cecafé) said that in the month, exports reached 2.53 million bags of coffee beans, up 5.90% over the same period last year, including 2.41 million bags of Arabica coffee, up 15.60% and 121,100 bags of Conilon coffee. Robusta, down 60.10% over the same period. The reason for the positive export results over the same period is because Brazilian traders boosted the sale of coffee for delivery when the price of coffee in the futures markets was at a favorable level for them in terms of the exchange rate.
English (giacaphe.com)
