Arabica coffee futures continue to be boosted by short covering and spec buying encouraged by new estimate of the Brazil’s 2023 crop that confirms the size of the crop will be lower than previously expected. The switch H/K traded up to +0.70 as the OI on the MAR23 contract decreases by 6,381 lots on yesterday’s session, now at 17,035 lots. The commercial selling was moderately noted as it appears to be well fixed ahead of the FND. Participants ponder the StoneX estimate for the Brazil 2023-2024 crop at 62.3 m 60-kg bags. The most active contract MAY23 settle 650 points higher at 183.25 cents a pound. Cert stocks declined 3,025 bags to 870,079 bags. Pending grading remains at 0. The Dollar recover previous loses after the U.S CPI was published with U.S CPI (YOY) (JAN) ACTUAL: 6.4% VS 6.5% PREVIOUS; EST 6.2%. Crude oil traded lower on fears of higher interest rates. The Brazilian real declined to BRL 5.2151.
Robusta MAY23 contract settled at $2070 +26 with a 2076/2040 range. A rally towards the top of the range fuelled by a strong rally in Arabica. Robusta seemed sluggish in its rally up to test the rest highs (2082) some origin selling was seen but volumes overall were nothing to get excited about. Only 7.3k lots on the May contract traded, and 2.7k Mar/may trading between -5/0. Mar23 2050 put traded 1000x @ 9.
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