Not much coffee changing hands. Producers refuse to sell Arabicas below R$ 400,00 mark and R$ 300,00 for Conillons. With Real strengthening more than 5% and NY not responding all the burden is felt on differentials.
Very tight for all qualities.
IBGE has release their first official crop estimate pegging Arabica at 38 million bags and Conillon at 15 million bags, 53 million bags in total.
Normally the market adds 10% of the total. However in our view, both IBGE and Conab have improved a lot mainly on Arabica number, the main distortion is still on Conillon numbers.
We have a higher total figure, not saying we are correct because crop numbers are always complicate in Brazil, but in short we found IBGE for Arabica too high and Conillon too low. As reported we see Arabica around 35/37 and Conillon at 20.
Weather has been mostly dry and hot since the start of the year. It has been raining here and there at the end of the day due to the heat but in a very spotty pattern.
Cecafe hasn´t released final number for December yet. We think exports from January to December 2018 probably will end up around 35 million bags.
January shipments according to Cecafé until 11th:
Emission 1.023.636 -38.3%
Effective 598.346 -39.6%
Wishing you a nice weekend
Terra Forte Trading Desk
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