KCNY and Currency
For the May/24 maturity, the most liquid, prices were between 182.70 and 194.75 cents/lb, oscillating 1205 points over the week. For Arabica, the development of the Brazilian crop, the weather so far and the outlook for the 24/25 harvest in Brazil are positive, but the boost in Robusta prices on the London Stock Exchange has pushed up prices on the NY ICE.
The dollar was quoted between R$4.9308 and R$4.9916 this week and the weakening of the dollar against the real is also an important factor in the movements of arabica in NY.
The arbitrage between New York and LONDON narrowed even further, to around -35 LDNK4 x KCK4.
On Friday (01), the Commodity Futures Trading Commission (CFTC) released a report on traders’ positions in the market for the week ended Tuesday (27), in which funds reduced their long positions for the second week in a row, to 32,126 lots. The balance for the previous week was 34,206. A new report with the position for the week ended on the 5th is due to be released this Friday (08).
Certified stocks of coffee on the NY ICE closed this Thursday (07) at 410,877 60 kg bags, representing an increase of 57,271 bags over the last week. There are currently 162,280 bags of coffee awaiting approval, of which 113,866 are of Brazilian origin.
MAY/24: Min: 182.70 | Max: 194.75 | Last: 185.30
BRL/USD: Min: 4.9308 | Max: 4.9916 | Last: 4.9790
*Data as of the completion of this report
WEATHER
With the weakness of El Níño since the beginning of January, cold fronts have been arriving more frequently in the Southeast of Brazil and organizing rainfall in all coffee-growing regions. In the last four days, all coffee-growing regions have had isolated afternoon showers as a result of the passage of a cold front along the southeast coast of the country.
On Saturday, a new cold front arrives in São Paulo and should advance to Minas Gerais on Sunday, possibly bringing moderate rainfall between Tuesday and Wednesday of next week to the northern regions of Espírito Santo and the south of Bahia.
Rain forecast for the week:
South Minas region: between 60 and 70 mm.
Zona da Mata region: between 60 and 70 mm.
Cerrado region: between 50 and 60 mm.
Alta Mogiana region: between 30 and 40 mm.
Garça region: between 30 and 40 mm.
DOMESTIC MARKET and FOB
During the week, the physical market was calmer until the sharp upward movements on the NY ICE on Thursday, after which orders from the selling end went up. On the FOB, there are many orders for shipments in the short term, while sellers are already down on some coffee qualities. Some deals for new crop shipments have also been reported.
The requests from sellers in the domestic are as below:
Strictly soft good cup running screen: seller around BRL 1,030.00
Strictly soft fine cup running screen: seller around BRL 1,060.00
Rio Minas: Running screen with 25% low grades around BRL 920.00
600 defects: around BRL 910.00
LOGISTICS
- According to the Detention Zero Bulletin (DTZ), produced by ElloX Digital in collaboration with Cecafé, the Port of Santos recorded a 75% rate of change of calls and delays for ships carrying coffee in February 2024, involving 75 container ships, with the longest interval of 22 days between the first and last deadline. Despite a slight improvement compared to January, the index remains above 75%, a level observed during the peak coffee, sugar and cotton crops in the second half of 2023. This result was achieved even in a month with a not so high volume of sugar, but still with a significant amount of cotton exported. The information was published by the Notícias Agrícolas portal.
The lack of food-grade containers has once again hindered schedules. Some shipments through the ports of Santos and Rio have been canceled for this reason. Some routes to Europe are already full until the end of March.
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.