november 15, 2022.

Despite of how much the dollar drops, Arabica coffee can’t find support. The ICE certified stocks and the fast- approaching FND continue to weight down. The most active march contract drives further into oversold territory, looking for the 149/151 area of support. March contract settle 740 points lower at 159.50 cents a pound. Total volume was noticeably higher with 75,275 lots including 25,099 switches. The Z/H switch had a range of -0.60/-3.00 with a settlement at -2.75. Inflation for U.S. manufacturers (producer price index or PPI) was reported below market expectations at 8% (y-y) vs. 8.5% last month and a market estimate at 8.3%. This is good news for the Fed, which with the positive inflation report, it is very possible that we will "only" have an increase of 50 basis points in December, instead of the expected 75 basis points. Today the certified stocks unchanged at 468,291 bags. The pending grading increased by 57,686 bags for a total of 598,716 bags. No grading.  
 
Robusta JAN23 contract settled at $1802 -22 with a 1822/1796 range. Today’s move certainly caught many by surprise, expectation was that a softer PPI print would help coffee back into the ‘’green’’. However, a new layer of spec selling into Arabica into very little commercial buying to stem the bleed dragged Robusta lower, a new test of the recent lows. Origin selling was noted today, and with Viet harvest in full swing and Tet holiday coming early the selling window is a small one. Volumes we fairly average with 7k lots trading on JAN23. JAN/MAR traded 1.6k lots between +8/+15. Jan23 1750 puts vs 1800Δ34 traded 1000x @ 37