My ideas the market couldn't remain that low at these levels for much time were wrong, but I am more dissapointed when I think unless the market will focus to what really matters,the continuation of the bear trend will be more prolongated.
And the thing is there is a well-orchestred bear scenario that the media, dominated by some groups, are succesfully trying to sell us. Yes, it is a "New Bear case scenario" under construction by the Bear guys in town. A new is because at the current prices something has to be new.
We cannot denied it we have to admit it. There are evil interests for a continuation of this fall.
A lot of poor agriculture families depends on the beans. They cannot live with prices at these levels. They are extremely indebt, they have been hit very hard with the COVID and now they are selling for peanuts their land and their facilities to big corporations and multinacional companies.
I don't know very much in deep about roasters but what I know is the coffee they will receive will have serious problems of quality this time. Also there will be not only delayed shipments but washouts for sure. Those washouts will come from shipments defaults from Origins but also from Traders who will look to replace their original commitments for other coffees with lower diffs.
The Industry acknowledged of those problems even making tons of money buying a pound of coffee for a little more than a dollar and selling at the stores contents of a less than a pound for 6 to 16 dollars, they now they will have more than that.
The story comes from this:
There are many importers that are really screwed up. They have sold to Roasters at very much lower price differentials and now because the diffs didn't go very much lower they are desperate to buy cheap coffee to compensate their mismanagement.
Funds know that and know the Brazilian goverment will compensate the exporters devaluating their currency to the INFINITE. So they GO SHORT or exit their longs. Ironically, the only thing we need to assure the chain of Poverty- profitability is a CHEAP COFFEE and obviously the continuation of this trend.
Currently when we know for 30 years coffee prices couldn't have stayed at 1 dollar a prolonged period of time, the only thing we need is to create is a BEAR CASE SCENARIO:
It is time to exacerbate the ideas that European lockdowns will dampen the coffee demand.. It is time to say there are warehouses full of unsold coffee in Brazil and also is time to minimize the serious drought or historically lower accumulated rains occurring in BRAZIL.
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