Arabica coffee closed lower Wednesday at the end of a slow session. The most active contract for March delivery settled 80 points lower at 194.25 cents a pound. Activity was light reflecting the holidays. Volume reached only 9,369 lots, including 1,435 switches. Markets in general declined as traders squared books ahead of end of the month. The ICE coffee market will be closed Thursday in observance of the Thanksgiving Day and Friday will close half an hour earlier. In related news, rainfall forecasted for this weekend in main growing regions of Brazil may bring some relief to the coffee trees after the terrible drought at the beginning of the year and insufficient rains during this season.
London Market - Activity in London was revolving around the same bases as the last few days with the board trading either side of the 2100 option strike in January. Light selling materialised scale above the board but not in the volume which could be of influence. The buying was comprised of different sources with the technical confidence growing as the board held gains into the morning. Vietnam begins to show some interest but the numbers are small therefore not representative as differentials weaken in line with the higher market over the last 3 days. The daily changes in the open position continue to reflect new positions down the board. Yesterday another 428 lots in September 2015 was recorded. Since the beginning of September that forward positions has jumped a lot which in principle can be tracked to some big trades back in September just before we rolled into October and has been creeping higher since then. Prices could not move away from the option strike into the second part of the day as the board prepared for the next leg higher. We have an interesting day ahead of us tomorrow with New York closed for “Thanksgiving” and London trading alone.