As yesterday, New York coffee traded steadily higher throughout the session buoyed by continued strength in the Brazilian real against the U.S. dollar (see chart enclosed). An eleven-month high in the Brazilian currency sent spot coffee “C” to its highest level in over fourteen months. So far this month (tomorrow is the last day), spot coffee is up twenty-one cents - it's strongest monthly gain since February 2015. The London market's volume was inflated by a repo roll.
September New York (KCEU6) settled near its high (91%), up 3.85¢. Volume was forty-five percent below average at an estimated 24,949 lots including an estimated 1,009 EFP's, 75 EFS's, 622 TAS and 5,774 spreads. 4,571 calls and 3,734 puts also traded. The KCEU6-LRCU6 arbitrage: 66.19¢. Ratio: 1.8474. €: $1.1107+0.4%. BRL: 3.2426/$+1.9%. CRB: +1.6%. Crude oil: +3.0%. S&P500:+1.6%. Open interest: 172,146+1,758 (50-day stochastic: 6%; 125-day: 5%).
September London (LRCU6) settled in its top third (71%), up twenty-one dollars. Volume was one-hundred-thirty percent above average at an estimated 42,309 lots due to the posting of 27,884 EFP's - 13,647 Jul16 and 14,237 Sep16. 3,920 spreads are included in the volume. 2,564 calls and 600 puts also traded. Open interest: 105,825-465 (50-day stochastic: 35%; 125-day: 11%).
Mostly-dry conditions will dominate coffee areas through the next ten days. Temperatures will be mild to warm with no risk of crop-threatening cold. - World Weather, Inc.
The Brazilian coffee harvest is now accelerating due to drier weather University of São Paulo research group Cepea says. Harvesting is still ahead of last year as farmers started harvesting earlier. In northwestern Parana 45% of the beans have been gathered compared to 30% last year. Harvesting in Espirito Santo is nearly 90% complete.