KCNY and Currency
Coffee prices on the New York Stock Exchange worked between 186.80 and 203.90 cents per pound on the March/24 expiration date, a significant oscillation of 1710 points over the week, demonstrating the high daily and weekly volatility of the coffee market. Concerns and expectations about the 24/25 crop, as well as the impact of the weather on the crop, are still relevant topics. In addition, the dollar also has an impact on coffee prices, as it is a key factor in price formation at origin. In terms of the exchange rate, the quotes for the week were between R$4.8500 and R$4.9512, with a certain devaluation of the dollar against the real.
The Commodity Futures Trading Commission (CFTC) is due to release on Friday (22) a report on the positioning of traders in the New York coffee market for the week ended Tuesday (19). In the latest report, investment funds increased their long position to 17,286 lots on the 12th, compared to 16,482 lots on the 5th.
Certified stocks of coffee on the NY ICE closed Thursday (21) at 247,912 60 kg bags. There are currently 25,225 bags pending approval, 12,280 of which are Brazilian coffee.
MARCH/24: Min: 186.80 | Max: 203.90 | Last: 192.30
BRL/USD: Min: 4.8500 | Max: 4.9512 | Last: 4.8634
*Data up to the finalization of this report
WEATHER
Spring 2023 in Brazil was marked by four heat waves and rainfall well below the historical average in all coffee-growing regions. Summer began today, December 22, at 00:27, and will last until March 20, 2024.
Summer begins with afternoon and evening rain showers in all coffee-growing regions, and with the arrival of a cold front on the 27th, the forecast is for moderate rain in the last few days of the year. Climate forecast models show that rainfall should be above the historical average during the summer.
Rain forecast for the week:
South Minas region: between 50 and 60 mm.
Zona da Mata region: between 40 and 50 mm.
Cerrado region: between 40 and 50 mm.
Alta Mogiana region: between 60 and 70 mm.
Garça region: between 30 and 40 mm.
DOMESTIC MARKET and FOB
On the domestic market, activities are slower and the significant fluctuations in coffee prices on the New York Stock Exchange have made negotiations more complex, with few deals reported. On the FOB, it is still possible to see the need for coverage in the near shipment months and, as a result, a few one-off deals for January and February shipments were seen.
The requests from sellers in the domestic were as below:
Strictly soft good cup running screen: seller close to R$ 1,000.00
Strictly soft fine cup running screen: seller close to R$ 1,040.00
Rio Minas: Running screen with 25% low grades close to R$ 840.00
600 defects: close to R$ 810.00
LOGISTICS
- According to data from the National Water Transport Agency (Antaq), between January and October 2023, port handling in Brazil grew by 6.02% when compared to the same period in 2022, reaching more than 1.08 billion tons handled. The information is from the A Tribuna portal.
Warehouses are already fully booked for the last few days of December, with little room for modifications. Ships due to leave in January 2024 still have no space restrictions and the problems with low stocks of containers have been occasional.
Atlantica Coffee Team
Disclaimer:
This analysis report aims only to provide information about the coffee market, based on internal and public sources, valid at the time of its dissemination. It does not aim to guide recipients in making any decisions, which are therefore solely the responsibility of the recipient. Atlantica Coffee is exempt from any liability arising from direct or indirect losses.