I am not a physical trader and therefore not qualified to estimate what coffee stocks are. There are several forum members that are indeed qualified to respond. However, to me it is obvious that there is sufficient coffee available not only based on USDA reports but also based on what the market is telling us.
The long side of the market, based on the COT reports, is speculative and so it is the driver of the upside. The short side is commercial which is comprised of option hedges and origin hedges. Spreads in Arabica do not indicate a shortage as they are all at a discount. In 2024 the spreads are at a slight premium but those months are thinly populated. Any tightness that exists in spreads is a result of origin selling of forwards and of the large OI of specs. Robusta is another story. Oddly, there is no dispute that this market has an abundance of stocks but the lockdown in Viet Nam has created a sharp premium market.
Ultimately, a good trader will take advantage of price movements regardless what reality is in the fundamentals.
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