Arabica, 101.45, -35, began the day under modest pressure following yesterday’s BRL selloff as ex-President Lula attempts to move his unsuccessful appeal to run from his prison cell from the domestic courts to the UN. EM contagion fears were also primary in the financial media, if greeted with a degree of dubiousness by coffee traders. Pressure would mount on coffee nonetheless, ultimately taking prices to fresh 12 year lows at 98.65 in the active / KC2 contract. 1st of month system selling along with renewed BRL weakness sent prices lower on three discrete clips of sizeable selling, the largest being two 800+ lot clips around 9:30am EDT. Roaster buying was noted – as expected – into the weakness, as was some discretionary trade house prop activity. The BRL would ultimately reverse course under uncertain circumstances, and KC followed as is custom. Robusta closed at 1475, -14, with better engagement than late. London has now posted 5 days of lower lows and lower highs, offering fresh opportunity to roasters swimming in such.
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