KCNY and Currency
Coffee prices on the New York Stock Exchange worked between 144.45 and 151.40 cents per pound on the December/23 expiration date, breaking through the 144.85 level, the low of the year recorded on January 11, and totaling a volatility of 695 points for the week.
The rains in the coffee-growing regions have been an important factor in pressuring prices, given the expectation of good flowering that will favor the 24/25 harvest. The recent rains have brought blooms in several producing regions, and these represent the last blooms of some crops. According to our technical team’s field and crop analyses, most of the crops are showing good bloom, are well nourished and are vegetating within the normal range. However, with the good moisture available in the soil and good fertilization, the less favored plants tend to return to good growth rates very quickly.
On the exchange rate front, the real continues to lose strength against the rising dollar, with high interest rates in the US being an important factor. This appreciation of the currency is also putting pressure on coffee prices. On Friday (06), the dollar rose sharply following the release of US economic data.
Certified stocks of coffee on the NY ICE closed Thursday (Oct 5th) at 442,222 60kg bags, with 8,365 bags still awaiting approval, all from Brazil.
DECEMBER/23: Min: 144.45 | Max: 151.40 | Last: 146.10
BRL/USD: Min: 5.0304 | Max: 5.2204 | Last: 5.1628
*Data up to the finalization of this report
WEATHER
The cold front that has passed through the Southeast in recent days has ended up organizing rainfall in almost all coffee-growing regions. It is the heat combined with the high humidity that favors the formation of rain showers in the late afternoon and evening.
For the next few days, the hot air mass will once again act in all coffee-growing regions. There is a chance of isolated, low-intensity rain only in the Zona da Mata, South Minas, Mogiana and Garça regions.
The El Niño phenomenon continues to gain intensity and is expected to have an impact on rainfall between December 2023 and February 2024, with much lower than average rainfall.
Rain forecast for the week:
South Minas region: between 10 and 15 mm.
Zona da Mata region: between 5 and 10 mm.
Cerrado region: no significant rainfall forecast
Alta Mogiana region: between 10 and 15 mm.
Garça region: between 10 and 15 mm.
DOMESTIC MARKET and FOB
On the domestic market, the dollar continues to appreciate and movements on the NY ICE allowed for some business, but in general the market was at a standstill this week. On the FOB, few trade was made in general, but the demand for Rio Minas remains strong.
The requests from sellers in the domestic were as below:
Strictly soft good cup running screen: seller close to R$ 780.00
Strictly soft fine cup running screen: seller close to R$ 830.00
Rio Minas: Running screen with 25% low grades close to R$ 710.00
600 defects: close to R$ 680.00
LOGISTICS
- The 1st National Meeting on Intelligence and the Port Environment, organized by the Brazilian Intelligence Agency, took place in Santos on Thursday. The aim of the meeting was to bring together those working in the port sector to debate topics such as combating the smuggling of goods and infrastructure solutions in the Port of Santos. The information is from the A Tribuna portal.
- According to the IstoÉ news portal, the Brazilian Association of Port Terminals (ABTP) is finalizing a proposal for the federal government that seeks to give concessionaires more autonomy to improve access to Brazilian ports, which are currently the responsibility of public management.
Most of the ships scheduled to depart in October are no longer available for new bookings. There has been no need to cancel or postpone schedules due to container restrictions.
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.