KCNY and Currency
The week started with NY “ICE” in a lot of volatility and a strong bullish movement within the range of the day, even though the adjustment was closer to the opening than to the maximum of the trading session, a mostly technical movement. The Real was volatile and depreciated sharply throughout the week. Many commodities are in decline and for another week, coffee is counteracting this movement. The “ICE” certified stocks remain in a continuous decline.
- According to a report from researchers at CEPEA (Center for Advanced Studies in Applied Economics) the liquidity in Arabica coffee negotiations is quite limited for this time due to the lower volume of coffee harvested in the 22/23 crop;
- As informed by Reuters, reported by local traders on Thursday, Vietnam’s coffee plantations were not impacted by Typhoon Noru, even though this was one of the strongest storms in two decades;
- Heavy rains in coffee regions have improve expectations for the 23/24 crop. Some nice pictures of blooms were shared in the coffee groups throughout the week;
- According to Rabobank’s commodity report, there is an increasing trend in demand for Robusta coffee, which is already increasing in the industries, as an alternative to the high prices of Arabica coffee. This trend is stronger due to the international recession scenario. However, conillon is still not exported much, due to its high prices when compared to other origins;
- In its third quarter report, Rabobank updated its supply and demand estimates, indicating a deficit of 5.8 million 60kg bags for crop year 21/22. For the 2022/23 crop, it moves from a surplus of 1.7 million bags to a deficit of 1.3 million 60kg bags, mainly in Arabica;
- The NY “ICE” certified stock closed Thursday at 435,409 60-kg bags, a reduction of 50,000 bags in the last 7 days;
DECEMBER/22: Min: 215,75 | Max: 228,15 | Last: 223,35
BRL/USD: Min: 5,2950 | Max: 5,4286 | Last: 5,3920
*Data as of the completion of this report
WEATHER
The cold front that crossed the states of São Paulo and Paraná in the last few days gained strength, due to the drop in atmospheric pressure on the coast of São Paulo, and it brought rain to all coffee growing regions in the last days of September.
For the first week of October, a new cold front is expected to bring some light rainfall to the South Minas, Mogiana and Zona da Mata regions.
The climate forecast models show that rainfall in October should be slightly above the historical average in the Cerrado and Zona da Mata coffee growing regions. In the other regions, there are possibilities of isolated rains, but below the historical average for the month.
Rain forecast for the week:
South Minas region: between 30 and 40 mm.
Zona da Mata region: between 35 and 45 mm.
Cerrado region: between 10 and 20 mm.
Alta Mogiana region: between 25 and 35 mm.
Garça region: between 15 and 25 mm.
DOMESTIC MARKET and FOB
It was a week with new business reported on a FOB basis and on the domestic market as well.
This week was busier and with opportunities mainly due to the volatility of ICE and the weakening of the Brazilian Real.
Strictly soft good cup running screen: seller close to R$ 1.260,00
Strictly soft fine cup running screen: seller close to R$ 1.320,00
Rio Minas:
17/18: R$ 1.150,00
15/16: R$ 1.120,00
Running screen with 30% low grades: close to R$ 1.050,00
600 defects: reported deals close to R$ 1.180,00;
LOGISTICS
Shipowners’ food grade container stocks remain low. Many schedules were cancelled this week for this reason, significantly impacting the forecast of shipped bags.
The main routes to the Americas, Europe and Asia are still without remaining space for the next 6 to 8 weeks.
We alert you to the need to bring forward the shipping instructions and to negotiate with more than one shipping company.
COVID-19 IN BRAZIL
People who received the first dose: +181.651.784
Fully vaccinated people: +170.738.912
Cases: + 34.706.757 million
Deaths: 686.027 thousand
Let’s continue believing and investing in the coffee culture!
Atlantica Coffee Team
FRAUD ALERT
Fraudsters have created accounts at the domains atlanticacoffeee.com (with 3 letters “e”), atlanticacoffees (plural) and atlantlcacoffee (using the lowercase of L instead of the letter i) and for the prefixes using the names of our employees, even imitating our signatures. They are quoting coffee, issuing invoices with altered payment data, mostly to banks in Hong Kong, which we are not ours! Please be aware of the sender of the messages and always question instructions to change bank details!
Our only official e-mail domain is: atlanticacoffee.com