Evening Coffee by Societe Generale

     New York coffee traded to its highest level in three-and-one-half weeks buoyed by a sharp rally in the Brazilian real. The dollar fell over 14¢ against the real (-3.8%) at its low but has since recovered ten cents of that decline. Mar16 New York rallied to its highest level since February 8th, finding selling against the chart gap left on that date (122.10¢@121.95¢). The London market traded within yesterday's range. The trading range for the week was set on Monday: $1419@$1351 in May16.
    May New York (KCEK6) finished near its high (93%), 3.20¢ higher today, 5.85¢ higher this week. Volume was six percent above average at an estimated 34,718 lots including an estimated 767 EFP's, 30 EFS's, 326 TAS and 7,936 spreads. 5,457 calls and 5,039 puts also traded. The KCEK6-LRCK6 arbitrage: 57.69¢. Ratio: 1.9130. €: $1.0997+0.4%. BRL: 3.7723/$+0.7%. CRB: +2.1%. Crude oil: +4.4%. S&P500:+0.3%. Open interest: 196,024+88 (50-day stochastic: 73%; 125-day: 76%). One tenderable notice was issued.
     May London (LRCK6) settled in its lower half (40%), down one dollar on the day, twenty-seven dollars higher for the week Volume was nineteen percent below average at an estimated 12,575 lots including 4,240 spreads and 35 EFP's. 175 calls and 175 puts also traded. Open interest: 135,907-4 (50-day stochastic: 74%; 125-day: 82%). One retender was posted.
     Brazil's 2016-2017 coffee crop will rise eleven percent year-on-year to 55.5 mln 60-kg bags from 50.0 mln Exportadora de Cafe Guaxupe commercial director João Carlo Hopp told Bloomberg news. Arabica output will rise to 42.5 mln bags from 35 mln while robusta out will drop from 15 mln bags to 13 mln.
     CFTC reports that large speculators sold 10,372 lots of Coffee “C” in the week ending March 1st increasing their net short position to 27,026 lots (67% of the record short). Large hedgers bought 8,890 lots (short 9,992). Index traders sold 365 (long 32,176). Small traders bought 1,847.