KCNY and Currency
Coffee – March/24 Options Expiry in NY
This week was marked by the expiration of options for the March/24 contract, causing significant price and HK spread fluctuations, reaching a maximum of +5.50 this Friday. The volume traded today on ICE was significant, totaling 109,914 lots, equivalent to over 31.1 million 60 kg bags.
The National Coffee Federation of Colombia released production data between October and January, totaling 4.619 million bags, representing a 21.6% increase compared to the previous year. The unresolved conflict in the Red Sea continues to support Robusta prices due to logistical chaos.
Certified stocks on ICE increased by 30,905 bags in the week until February 09, totaling 297,795 bags available. In the pending stocks, the balance dropped to 30,534 bags, a decrease of 34,580 bags in the period.
Economy – Inflation and Employment Data
The United States Federal Reserve adopted a cautious stance after strong employment data, not signaling an interest rate cut and stating that greater robustness in inflation data is necessary.
On the local scene, January’s IPCA came in above expectations, providing support to the future interest rate curve and leading to a depreciation of the real against the dollar.
MARCH/24: Min: 188.65 | Max: 197.45 | Last: 192.20
BRL/USD: Min: 4.9052 | Max: 4.9811 | Last: 4.9718
*Data up to the finalization of this report
WEATHER
The cold front that arrived in the Southeast of Brazil last Sunday ended up organizing low-intensity rains in almost all coffee-growing regions. The frontal system is advancing towards Bahia and is expected to dissipate from Sunday.
A new cold front arrives in the Southeast on Tuesday afternoon and could cause moderate rainfall between Tuesday and Friday in the coffee-growing regions of Garça, South Minas and Cerrado.
Rain forecast for the week:
South Minas region: between 80 and 90 mm.
Zona da Mata region: between 20 and 30 mm.
Cerrado region: between 80 and 90 mm.
Alta Mogiana region: between 80 and 90 mm.
Garça region: between 80 and 90 mm.
DOMESTIC MARKET and FOB
The market remains basically the same as last week, with no major movements. On the FOB, prices are still being monitored for immediate shipment, while there are few offers on the domestic market. The requests from sellers in the domestic are 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$ 1,070.00
Rio Minas: Running screen with 25% low grades close to R$ 1,000.00
600 defects: close to R$ 900.00
LOGISTICS
- According to information published by InfoMoney, the tax auditors of the Federal Revenue Service ended their strike, which began on November 20, in the late afternoon of Thursday (8), after accepting the proposal presented by the federal government to meet the demands of the category.
- According to information published by the Notícias Agrícolas portal, the index that assesses delays and changes of call for ships at the Port of Santos reached 85% in January, marking the highest percentage ever recorded. This trend has contributed to the increase in logistical challenges and costs in foreign trade. The Brazilian Coffee Exporters Council (Cecafé), in collaboration with the startup ElloX Digital, was responsible for drawing up this indicator.
There were no delays or cancellations due to lack of containers. However, we have already warned of the limited availability of ships leaving at the end of February and beginning of March, in the main destinations in Europe and the main ports in the USA.
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.