KCNY and BRL / USD
In a week of high volatility, the NYSE recorded hikes above 400 points in Arabica prices on the first day, with H1 breaking through 125.00 usc/lb and recording the USD / BRL 5.03 low, close to the mark of R$5.00. Throughout the week, the real fluctuated between 5.0094 and 5.1430. KCH1 between 120.65 and 128.60.
Prices reflect the concern of the supply of 21/22 in view of the conditions of Brazilian crops and the crop failure expected in Brazil on 21/22. At the same time, it reflects the American stocks and the arrival of vaccines in the world that could lead to an increase in coffee consumption outside the home.
Stocks of green coffee in US ports have been falling for 4 consecutive months, according to GCA data, which may show a heated demand for coffee in the world’s largest consumer. In November, there was a drop of 328,022 bags, remaining 5.8 million (the lowest level in 5 years), adding up the stock exchange deposits and the volumes held by players. NY certified stocks total 1,356,542 bags (down 21,483 bags), with Brazil originating 292,666 bags (21.57%).
The economic recovery plans of the rich countries, fiscal and monetary stimulus in the United States and the election of Biden, brought a feeling of optimism to the market, greater avidity by foreign investors for emerging markets and the fall of the dollar. Still, the reduction of uncertainties with the advancement of reforms in Brazil brought strength to the real against the dollar which was quoted close to 6 reais during the pandemic and returned to operate at around R$ 5.
WEATHER
Until next Wednesday 23, there is a forecast from Somar Meteorologia of rainfall between 50-125mm in Minas Gerais, São Paulo and Paraná. Lighter rains between 15 and 50 mm in Espírito Santo and Bahia, which will intensify between Christmas and the New Year.
DOMESTIC AND FOB MARKET
With the end of the year, the market is even calmer, both on the buyer side and on the seller side. The producer believes in strong price rises with expectations of a break in the next harvest. The general warehouses are full, but with a normal flow of operations.
INTERNATIONAL LOGISTICS IN BRAZIL
The lack of food-grade containers and space on vessels continues to occur. The sending of Shipping Instructions in advance is essential so we can act in advance in bookings. The inspection of containers in CMA CGM’s Depot remains suspended, therefore, we continue not embarking with this shipowner until the inspection is authorized again.
COVID-19 IN BRAZIL
Cases: 7.04 M
Deaths: 184 K
Recovered: 6.24 M
Let’s keep believing and investing in the coffee culture!
Take care,
Atlantica Coffee Team