That is not relevant. World Monthly coffee consumption is around 1'400,000 bags. What is 32 k bags?
The thing you need to observe is ICE stocks are disappearing and I am seriously afraid there will be a big drawdown of those stocks soon. Ice STOCKS are very cheap compared with the coffee that could be bought at Origins where prevails very high differentials. The Industry that cannot buy enough ROBUSTA from Vietnam may decertify a big bulk of them anytime.
And by the way, the thing that coffee is been bought at a very high differential is because those premiums the buyers pay at Origins reflect the real price of the coffee. And that coffee is not an FTO or FT. Those coffees are paid at 160 or 190. The high diffs are for a clean cup of a coffee grade type 1, 80 defects, or lower. Better coffees, destiny pays better prices
And remember the equation now is the lower the NEW YORK C is the higher the premiums they will have to pay
IMO this situation of extremely low prices cannot last forever. Sooner o later the New York C price will have to recover and reflect the real price, lowering the price diffs as well.
« Back to index