September 18 2019
Brazilís government food supply and statistics agency CONAB have come forth with a revised lower forecast for the current 2019 Brazil coffee crop, to reduce their estimate by 1.9 million bags from a total 50.9 million bags projected in May, to 49 million bags in their review yesterday. According to their report, the reduced estimate is related to drier than normal weather which they forecast to have affected this yearís arabica crop to potentially reach 34.47 million bags. There is meanwhile, an upward revision in their forecast for conilon robusta crop this year, which they project to be moderately increased by 590,000 Bags, at a total revised estimate of 14.52 million bags.
One might comment though, that this forecast is significantly lower than a host of other respected trade and industry forecasts and is traditionally conservative. Thus, one might think that most market players might adhere to these earlier forecasts that have foreseen the 2019 Brazil crop at between 55 million and 60 million bags. This while market players have turned attention to the prospective development of the 2020 Brazil crop and the approaching summer rain season that will assist to set the flowering and early development for this coffee crop that is, provided climatic conditions remain conducive, anticipated to be larger biennial bearing crop to come.
The Certified Robusta coffee stocks held against the London exchange have been reported as hardly changed and seen to increase by 1,500 bags over the weeks of trade leading up to Monday 16th September, to see these stocks registered at 2,573,500 bags, on the day.
The November to December contracts arbitrage between the London and New York markets narrowed yesterday; to register this at 40.79 usc/Lb. This equates to 40.65% price discount for the London Robusta coffee market.
The Certified washed Arabica coffee stocks held against the New York exchange were seen to decrease by 2,250 bags yesterday; to register these stocks at 2,310,673 bags. There was meanwhile a smaller in number 701 bags decrease to the number of bags pending grading for this exchange; to register these pending grading stocks at 26,319 bags."
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