The weather reports from Brazil continue to come to fore with good rainfall reports for all of the major coffee districts in the country, this following localised rainfall through the month thus far, to assist to set the flowerings for the next 2021 coffee crop. This albeit still early days in terms of the October to March rain season, is leading many to speculate that the country and despite biennial bearing factors, is due for a good coffee crop for next year.
The new crop harvest in Vietnam is soon to start, albeit slightly delayed in their seasonal year, due to a continuation of rain through October across the coffee growing areas. So long as the rain subsides the harvest may be expected to start to peak by the second half of next month. Meanwhile, with the internal market in Vietnam is reported to be subdued with the soft nature of the reference prices of the London market providing little inspiration for producers to participate within the prevailing environment, a junction between the past crop that is already well sold and the new harvest shortly due to begin.
The December 2020 to January 2021 contract arbitrage between the New York and London markets narrowed yesterday; to register this at 46.14 usc/Lb. This equates to 44.30% price discount for the London Robusta coffee market.
The Certified washed Arabica coffee stocks held against the New York exchange was seen to increase by 3,572 bags yesterday, to register these stocks at 1,127,470 bags, with 93.80% of these certified stocks being held in Europe at a total of 1,057,710 bags and the remaining 6.20% being held in the USA at a total 69,760 bags. There was meanwhile a larger in number 8,400 bags increase to the number of bags pending grading for this exchange; to register these pending grading stocks at 42,278 bags.
The Certified Robusta coffee stocks held against the London exchange have been reported to increase by 86,500 bags over the weeks of trade leading up to Monday 19th. October, to see these stocks registered at 1,890,500 bags, on the day.
It was a modest soft day overall on the commodity markets yesterday, to see the overall macro commodity index taking something of a sideways track for the day. The Cocoa market ended the day on a positive note, while the Sugar and Coffee markets ended the day on a softer note. The Reuters Equal Weight Continuous Commodity Index that is related to 17 markets is 0.1745% lower; to see this index registered at 420.7936.   The day starts with the U.S. Dollar steady, trading at 1.314 Sterling, at 1.185 the Euro and with the US Dollar buying 5.609 Brazilian Real.
The New York and London markets opened the day yesterday trading on a modest soft note, both markets quickly gained momentum to see the markets trend positive for the remainder of the morning session. As the afternoon progressed both the New York and London markets came under a degree of selling pressure to see the markets drop back off the highs of the day and trend softer for the afternoon trade. The London market settled near to the lows of the day, while the New York market settled on a modest softer note for the day.
The London market ended the day with on a modest negative note with 83.33% of the earlier losses of the day intact, while the New York market ended the day on a likewise negative note with 48.39% of the earlier losses of the day intact. The softer close does little to indicate direction nor inspire confidence and one might think the markets are due for little better than a hesitant steady start to early trade today
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