INTL FCStone Daily Coffee Report
Arabica coffee futures consolidated higher Wednesday on a spread-dominated session. The benchmark contract for March delivery settled 85 points higher at 144.50 cents a pound. Volume reached 47,333 lots including 15,430 switches. The nearby Mar-May switch weakened 15 points to end at -2.45 cents. As we approach the delivery period, less producer selling has been present. The dollar traded between positive and negative territory, adding volatility to the commodity complex. Better than expected US economic data helped the currency early, however comments from Mrs. Janet Yellen, Chairwoman of the Federal Reserve, acknowledging the economic grow has been “quite disappointing“, pushed the currency down later on the session. Colombia exporters expressed concern about a possible trucker strike in Colombia. The National Crusade, a trucker union, denied today that they have given an ultimatum date for the government to reach an agreement to their petitions. Last year, a trucker strike during June-July caused disruptions of the coffee exports. The fly crop which begin in April could be affected as well.
GCA green coffee stocks increased by 66,627 bags during Jan to 6,322,767 60-kg bags. Last year Jan’s green stocks increased 907 bags. The average change of the last five years has been an increment of 4,754 bags
London Market-Weakness in the nearby structure saw flat price values fall through the early stages of the session before a mid-afternoon recovery resulted in London closing in positive territory for the first time this week.
The opening bell saw the March/May spread immediately replicate yesterday’s action, weakening to $33 discount through good volumes, driving outright prices lower through the 100 day moving average at $2124. Roasters once again returned to halt additional moves lower, providing a solid base for the market to move higher later in the session. Strength in the Brazilian Real drew intra-day buying back into the ‘C’ contract which also acted to pull London higher, accentuated by the May/July strengthening into $9 discount through 2800 lots. Technically, the market maintains its uptrend, twice rebounding from consecutive breaches of the 100 day moving average at $2124 basis May.
March options expired with an anchor price of $2091, while further options turnover was generated with 1100 lots of the July 2100 puts bought alongside the selling of 1100 May 2200 calls.
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