There is a possibility of the ICE coffee certificates start replenishing soon which will counter balance somehow the strong Robusta Fundamentals.
If you add to that, the Industry is not buying now, because Roasters are well supplied, the situation becomes very much complicated for the bulls traders.
However Funds don't care very much about this, at least now. They are buying coffee as well as other commodities because the world is dumping the dollar down against its pairs, the FED balance sheet is growing to the infinite and then going long commodities is a good opportunity for them to profit. Make sense indeed?
However they could be wrong at certain point, and that is because the expectations about future inflation for the US economy has grown too much. Also about the vaccine that would come soon and will resolve everything and finally the expectation of the world economic recovery that would be super strong.
I'm not very sure about any of those three, could happen.
Inflation cannot be present in a collapse economy and if inflation starts running very much high above the 2% target, the FED would stop it sacrificing the economic growth, so a very high inflation is not going to happen, neither a solid economic recovery would, and
because the high indebtedness of the US the economy that could not grow robustly.
About the Vaccine, not only in my opinion, but major doctors think this is not going to happen that soon. The first one could come not as good one as we think, besides the delays in the administration and skepticism among the people.
So what inflation or strong recovery we are talking about?
As the FED has inflated the stock market as well as other assets, IMO we are inflating too much also our expectations that everything is going be fine and the only thing would save us is a future inflation... that is not going to happen.
Once the November election or before that time, the US stock market will correct, as the US dollar will gain traction again. That situation could drag down the commodity sector including our New York coffee market.