november 3, 2022.

Arabica coffee futures fell Thursday on worries that a global recession that can affect the demand for commodities following the increase in US interest rate. The most active contract for December delivery lost 995 points to settle at 172.20 cents a pound. The volume reached 54,826 lots including 16,108 switches. The activity was mainly driven by short-term specs and spreads traders. The weather in Brazil has been erratic but trending to a wetter pattern. A cold form caused temperatures to drop below 10.C in south-central areas, without causing any frost. The rains should return to producing areas next week. The strengthened of the dollar added pressure on the commodity complex. The euro devaluated to near the lows of the last two weeks. The Latin American currencies were mixed with the real trading stable at BRL 5.1100. The Colombian peso fell to new historic lows at COP 5,100. The certs stocks declined 2,100 bags to 382,695 bags, a 23-year low. Another 20,745 bags arrived for grading in Antwerp for a total of 161,656 bags. In Hamburg 646 remain pending grading.  
 
Robusta JAN23 contract settled at $1842 -40 with a 1883/1814 range. With Powell’s unexpectedly hawkish comments on Wednesday evening stoking the $ fire it was always going to be a massive headwind for the commodities basket. Robusta got swept away with the macro and the sellers hitting Arabica. Roasters were not present to absorb the selling pressure. Near term support was found at pivot support 3 however this was a new low for 14 months +. Volume was strong on the Jan23 contract with 13k lots of flat price trading. Jan/Mar had a 12/21 range on 2k lots. Trades 4000x @ 73 Jan23 1750/1900 call spread vs 1820Δ32, Trades 4000x @ 94 Jan23 1750/1950 call spread vs 1838Δ40.