For instance, spending on coffee in France jumped 34.6% as compared to the same period the year before while in Italy, it went up 29.5%, according to data from Chicago-based market research institute IRI.
I propose to you that the margins at this time are so good on supermarket coffee and the fact that the consumer is not being price sensitive at all that no coffee roaster wants to see his shelf space empty. Commercials will keep their pipeline and stocks full. Yes this will bring future sales forward which is fine with me because I see many positives developing for coffee down the road.
Several points I think support this argument:
1) coffee prices have not been able to register a new continuation low since May 19.
2) premiums for Central American and Colombian coffee are very well bid.
3) prior the Brazilian harvest ICE stocks were moving out of storage at a rapid rate.
4) coffee spreads are firmer than you would expect.
5) exports out of Brazil are exceeding expectations.
What happens to demand when we get back to normal or a vaccine is available?
I often find that when everyone knows why prices are reacting a certain way that trend has often run itís course.
Just my 2 cents.
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