Evening Coffee by Societe Generale

     New York coffee traded within yesterday's range in reduced volume. Yesterday's extremes -116.55¢ and 113.40¢ in May16 - are actionable levels. The London market fell below yesterday's low then rallied back, finding resistance near the middle of yesterday's real body (i.e. the range between the days' opening and its close). The action of the past two days is contained in Monday's: $1419 to $1351 in May16. Those levels are also actionable (i.e. buy above the higher level, sell below the lower).
     Crude oil closed higher the past two days despite news of a sharp inventory increase. While the coffee market's correlation to crude is still positive at 71%, it has been weakening over the past two weeks.
     May New York (KCEK6) settled in its upper third (72%), eighty points higher. Volume was twenty-one percent below average at an estimated 25,310 lots including an estimated 864 EFP's, 475 TAS and 7,309 spreads. 4,203 calls and 3,362 puts also traded. The KCEK6-LRCK6 arbitrage: 52.78¢. Ratio: 1.8365. €: $1.0867 unchanged. BRL: 3.8934/$+0.9%. CRB: +½%. Crude oil: +2.1%. S&P500:-0.1%. Open interest: 195,239+4,635 - up 12,019 lots over the last three reports (50-day stochastic: 72%; 125-day: 74%). Eighteen tenderable notices were posted.
     May London (LRCK6) settled near its high (96%), up fourteen dollars. Volume was thirty-four percent below average at an estimated 10,316 lots including 2,805 spreads and 688 EFP's. 2,750 calls and 1,680 puts also traded. Open interest: 135,177+3,566 (50-day stochastic: 71%; 125-day: 80%). 53 original tenders and 99 retenders were posted.
     Honduras exported 707,136 60-kg bags of coffee in February, the national coffee institute IHCAFÉ reports, up 10.1% from 642,019 bags last February. That brings the total shipped in the first five months of the crop year to 1.71 mln bags, up almost eight percent from the same period one year earlier.
     Guatemala's February coffee shipments rose 23.8% year-on-year to 315,037 60-kg bags the National Coffee Association reports.
     The Costa Rican Coffee Institute puts February coffee exports at 144,426 60-kg bags, up 17.1% from 123,357 bags last year.
John Bernardi