Coffee prices weakened by currency (September 23, 2020): US technology stocks continued to recover, but concerns from “hidden” activities of the world banking industry and disagreements from the US Congress made USDX strong again, causing many commodity markets to turn their inputs. at the end of yesterday session.
Ending the session, Robusta coffee prices on ICE Europe – London dropped for the fourth consecutive session. November spot futures dropped by 6 USD, down to 1,341 USD / ton and January delivery term dropped by 5 USD, to 1,357 USD / ton in slight decrease. Trading volume below average.
Similarly, Arabica coffee prices on the ICE US – New York floor had a seventh consecutive decrease session. Futures for immediate delivery in December decreased by 1.35 cents, to 110.65 cents / lb and for March futures decreased by 1.4 cents, to 112.45 cents / lb, the decline is very significant. Trading volume remained very high above average.
The price of green coffee in the Central Highlands provinces decreased by 100 VND, down to fluctuating in the frame 31,500 – 32,000 VND / kg.
Export Robusta coffee price type 2, 5% broken black, stood at 1,467 USD / ton, FOB – HCM, with a difference plus 90 – 110 USD / ton in term of January in London .
Reais fell 1.29%, to $ 1 = 5.4690 Reais, the lowest this month due to the appreciation of foreign currency on fears that the President of Brazil would adopt a new tax reform program and uncertainty in the economic recovery, while Copom still leaves open the possibility of continuing to cut interest rates after having made consecutive cuts even though USDX is still high. A weak Reais continued to stimulate Brazilians to boost coffee sales when they had just harvested a record “season” with more than 68 million bags, slightly lower than the historic 2018 crop.
The Coffee Exporters Council (Cecafé) in Brazil expects to have about 680,000 bags of Arabica natural coffee, selected for delivery to ICE for “C” certification from now until the end of the year, to meet the needs of customers. In the context of a shortage of high-quality Arabica producers in Central and South America on the New York stock exchange because they are taking measures to prevent the covid-19 epidemic from social stretching, while the harvest The new 2020/2021 coffee season is also about to begin.
According to information from ICE, even though delivery is allowed, coffee originating from Brazil is subject to a set reduction. To get ICE’s approval, Brazilian coffee traders have struggled for more than 10 years, because Brazil mainly produces traditionally dried Arabica natural coffee without wet processing to have the same high quality as coffee. Arabica coffee “mild” of Colombia and the Mexican production bloc – Central America.
Although coffee futures prices showed signs of recovery when they entered the “oversold” zone , short-term speculation took profits, but the pressure of the money market made investors continue to stand outside waiting to hear. waiting for more to make the price drop deeper.