january 16, 2022.
Arabica coffee futures for march delivery settled 230 points higher at 151.70 cents a pound. Volume reached 51,572 lots including 14,885 switches. The speculative short covering eased today; however commercial buying supported the prices modestly. During the week Arabica prices lost 4.1%, or 6.60 cents. The breach of the key support level at 155, March position, triggered heavy liquidations that pushed the “C” prices to the lows of more than 1-1/2 year low at mid-week. Market participants continue to be focused on the developing of the Brazilian 2023 crop, now with higher expectative as the weather has improved notably. CONAB will release their first forecast of the crop on January 19th. Other industry estimates will follow, including the first official estimate from StoneX, who is currently conducting their crop tour. The market will be closed Monday in observance of the Martin Luther King Day holiday. The GCA stocks report for the end of December will be published on Tuesday. Certs stocks increased by 5,146 bags to 850,724 bags. Pending grading: 139,161. Grading today: 16,284. Passed 5,146 bags (31.5%). Failed 11,138 bags (68.5%). Since the beginning of the year there has been an increase of 36,038 bags in ICE certificates
The Robusta terminal continues to defy gravity ending the session 2% higher as ongoing fund short covering absorbs a wall of origin selling. This is one of those rare weeks when both ends of the commercial spectrum are happy, as roasters were heavy buyers on Wednesday below $1820 and origin selling into the move above $1880 into the later stages of the week. Sadly, this will not be captured by the latest COT as the activity occurred after the cut of period. Levels have finally breached and settled outside the $1757 - $1893 basis March23 range which has been in play since October. Despite heavy gains, oscillators are still in neutral territory amid solid trend strength, which will grant comfort to the nearby speculative long searching for further gains moving into next week. However, this will rely heavily on the return of fund buying as the market continues to observe solid appetite from the commercial short to add to positions into these gains.
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