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Weekly coffee market review 11/23/2020.Support us by consulting our free daily magazines with color stock charts and weather maps on our commodity-market-review.com website. TECHNICAL ANALYSIS OF ARABICA COFFEE Last week, ICE US coffee futures closed higher at 118.05 ct/lb. Hopes for a vaccine are fuelling the markets, and Pfizer and Moderna have announced very encouraging results. Many countries, such as the United States, Germany, Spain, and others, are already preparing vaccination campaigns. The pandemic continues unabated, with more than 58 million cases worldwide and more than 1.382 million deaths. The United States is the most affected country with more than 256,000 deaths and more than 12 million cases. The hope of a vaccine, as well as the prospects of a massive stimulus package, is driving the markets. The dollar is still low and in a downward trend, the DXY closes at 92.392. The end of the year marks the arrival of production from Central American countries. Last week, the powerful Hurricane Iota hit Central America and Honduras, an important coffee producing region. Colombian production is expected to remain stable at 14.1 million bags, thanks to the replanting of rust resistant coffee trees. 83% of Colombia's total area would have been renewed with these varieties. The price of Arabica coffee is also benefiting from concerns about the supply of Robusta coffee. Vietnam, the largest producer of this type of coffee, is encountering very heavy rains following the passage of several typhoons, causing fears of a smaller harvest and smaller bean sizes. In Brazil, forecasts for the next harvest are still down due to the effects of the drought this summer, particularly in Minas Gerais. Rainfall in the Brazilian coffee belt in October was below normal, and also in November after 3 weeks. In addition, Arabica coffee trees are on a biannual cycle of small and large harvests, so the next crop will be smaller anyway. According to the International Coffee Organization, world coffee exports in 2019/20 fell by 4.9% to 126.9 million bags. Production in 2019/20 is estimated at 168.84 million bags, down 2.5%, and consumption fell by 0.9% to 167.59 million bags. This would lead to a surplus of 1.24 million bags. WEATHER IN BRAZIL 90% of Brazilian coffee is grown in 4 regions: Minas Gerais, Espirito Santo, Sao Paulo and Parana. Rainfall was below normal in October in the Brazilian coffee belt. The rains were late in coming and irreversible damage is feared for the next harvest. The rainy season has now begun. Last week the rains were below normal. It fell about 50 mm. After 3 weeks, the rainfall over the month of November is still below normal. According to the forecast, next week the rains will also be below normal, with only 20-30% chance of rainfall above 50 mm. ICE US CERTIFIED COFFEE STOCKS Coffee stocks are up to 1.236 million bags of 60 Kg, compared to 1.198 the previous week. ICE US stocks of Arabica coffee are below the five-year average. The low stocks may provide some support to the coffee price on futures contracts. THE DOLLAR The DXY index representing the Dollar against a range of foreign currencies closed last week down to 92.392, and the trend is still bearish. Joe Biden, who will be invested on January 20, spoke of a $3 trillion support plan. Forex traders are anticipating an increase in the money supply. Treasury Secretary Steven Mnuchin has called on the FED to return unused funds from emergency aid programs for the coronavirus crisis. The FED has decided to do so, although it considers this decision premature. Last week, this did not cause much movement in the currency market, which remained relatively calm. The previous week, the Brazilian Real closed higher at 0.1855. The fall of the Dollar benefits the Real. The BRL/USD pair is positively correlated with coffee futures prices. A weak Real increases the competitiveness of Brazilian producers and encourages them to export. COMMITMENTS OF TRADERS The weekly COT (Commitments of Traders) report of the Commodity Futures Trading Commission (CFTC) shows all the positions opened by all market participants. The COT report is published on Friday, and reflects the open positions on Tuesday of the same week. It shows the position of commercial traders (producers, commodity buyers, ...) but also non-commercial (speculators). The net positions of speculators on the futures markets are particularly interesting to observe. The speculative net position on the coffee futures markets is down this week to 24.006 K instead of 28.021 K.
ICEUS:KC1!
by Commodity-market-review
Weekly coffee market 11/16/2020.Support us by consulting our free daily magazines with color stock charts and weather maps on our commodity-market-review.com website. TECHNICAL ANALYSIS OF ARABICA COFFEE Last week, ICE US coffee futures closed higher at 112.20 ct/lb. Hopes for a vaccine are fuelling the markets, Moderna announced on Monday very encouraging results. The pandemic continues unabated, we have just surpassed 54 million cases worldwide, with more than 1.320 million deaths. Faced with the second wave, Europe has been confined. The United States is the most affected country with more than 246,000 deaths and more than 11 million cases, and is also taking restrictive measures such as in New Jersey and Michigan. The end of the year marks the arrival of production from Central American countries, or Colombia, which adds downward pressure to the market. Arabica coffee production in Colombia amounted to 1.159 million 60-kg bags, down 15% in October, compared to 2019. In Brazil, forecasts for the next harvest are down due to the effects of drought this summer, particularly in Minas Gerais. According to the International Coffee Organization, world coffee exports in 2019/20 fell by 4.9% to 126.9 million bags. Production in 2019/20 is estimated at 168.84 million bags, down 2.5%, and consumption is estimated to fall by 0.9% to 167.59 million bags. This would lead to a surplus of 1.24 million bags. The price of Arabica coffee is also benefiting from concerns about the supply of Robusta coffee. Indeed, Vietnam, the largest producer of this type of coffee, is experiencing very heavy rainfall following the passage of several typhoons, which makes harvesting difficult and threatens to damage the crop. WEATHER IN BRAZIL 90% of Brazilian coffee is grown in 4 regions: Minas Gerais, Espirito Santo, Sao Paulo and Parana. Rainfall was below normal in October in the Brazilian coffee belt. The rains were late in coming and irreversible damage is feared for the next harvest. The rainy season has now begun. Last week the rains were below normal. It fell by 25 to 50 mm. According to the forecast, next week the rains will be in line with normal with a probability of more than 50 mm. ICE US CERTIFIED COFFEE STOCKS Coffee stocks are up to 1.198 million 60 kg bags, compared to 1.170 the previous week. ICE US stocks of Arabica coffee are below the five-year average. The low stocks may provide some support to the coffee price on futures contracts. THE DOLLAR The DXY index representing the Dollar against a basket of foreign currencies closed last week up to 92.755, after a sharp decline in early November. The U.S. elections will continue to bring volatility to the currency market. Joe Biden will be sworn in on January 20, the Senate remains Republican for now, but a second round will be held on January 5 in Georgia. There is still a lot of uncertainty about the size and date of the famous plan to support the American economy. The Fed has announced that it will increase its "firepower" if necessary. Forex traders therefore anticipate an increase in the money supply. The pandemic is not weakening, Europe has reconfirmed itself in the face of the second wave, the United States is also taking new measures of restrictions in some states. The hope of a vaccine, with the announcement of Pfizer, calms the markets and prevents for the moment the dollar from playing its role as a safe haven. Caution is still called for, however, as many questions about vaccines remain unanswered. The dollar has a strong influence on the price of raw materials, and it will be very difficult to predict its evolution in the coming months. Yesterday, the Brazilian Real closed lower at 0.1828. The Dollar's fall allowed the Brazilian Real to rebound. The BRL/USD pair is positively correlated with coffee futures prices. A weak Real increases the competitiveness of Brazilian producers, and encourages them to export.
ICEUS:KC1!
by Commodity-market-review
Weekly coffee market review 11/09/2020.Support us by consulting our free daily magazines with color stock charts and weather maps on our commodity-market-review.com website. TECHNICAL ANALYSIS OF ARABICA COFFEE Last week, ICE US coffee futures closed higher at 106.95 ct/lb. The pandemic continues unabated, we have just passed 50 million cases worldwide, with over 1.250 million deaths. Faced with the 2nd wave, Europe is confining itself or imposing curfews. The United States is the first country to exceed 100,000 new cases in one day. Joe Biden wants to set up a crisis unit. In Europe, many non-essential businesses are closed such as bars and restaurants. Bars and restaurants are places of high coffee consumption, and their closure in Europe will weigh on demand. The end of the year marks the arrival of production from Central American countries, or Colombia, which adds downward pressure to the market. According to the International Coffee Organization, world coffee exports in 2019/20 fell by 4.9% to 126.9 million bags. Production in 2019/20 is estimated at 168.84 million bags, down 2.5%, and consumption fell by 0.9% to 167.59 million bags. This would lead to a surplus of 1.24 million bags. In the United States, Joe Biden will be sworn in on January 20, 2021, the Senate remains Republican for the time being, but there will be a second round in Georgia on January 05. If the Democrats win both seats, that would bring the distribution to 50-50 seats, and Vice President Kamala Harris could constitutionally break the tie. In the absence of a majority in the Senate, voting on a plan to support the U.S. economy would be made more difficult. This leaves uncertainty as to the timing and amount of the plan. Last week the Fed reaffirmed its willingness to support the US economy and is ready to "increase its firepower" if necessary. The dollar fell sharply, with the DXY dropping from over 94 at the beginning of last week to close Friday at 92.236, a drop that benefited all dollar-denominated commodities. WEATHER IN BRAZIL 90% of Brazilian coffee is grown in 4 regions: Minas Gerais, Espirito Santo, Sao Paulo and Parana. Rainfall was below normal in October in the Brazilian coffee belt. The rains were late in coming and irreversible damage is feared for the next harvest. The rainy season has now begun. Last week the rains were below normal. Minas Gerais and Espirito Santo received 50 mm, while further south Sao Paulo and Parana were drier. According to the forecast, next week the rains will be in line with normal with a probability of rainfall above 50 mm. ICE US CERTIFIED COFFEE STOCKS Coffee stocks are up to 1.170 million 60 kg bags compared to 1.129 last week. ICE US stocks of Arabica coffee are below the five-year average. The low stocks may provide some support to the coffee price on futures contracts. THE DOLLAR The DXY index representing the Dollar against a basket of foreign currencies closed last week, down sharply at 92.236. The U.S. elections will continue to bring volatility to the currency market. Joe Biden will be sworn in January 20, the Senate remains Republican for now, but a second round will be needed in Georgia. Therefore, there is still a lot of uncertainty about the size and date of the famous plan to support the American economy. Last week's statements by the FED certainly weighed heavily on the dollar. The FED announced that it could increase "its firepower" if necessary. Forex traders are therefore anticipating an increase in the money supply. On Sunday, the United States experienced a record covid-19 for the 4th consecutive day, and even though the news was dominated by the elections, the pandemic could be remembered by investors if the US faces a 2nd wave similar to the one hitting Europe. A return of the dollar as a safe haven is not a possibility to be ignored. The dollar has a strong influence on the price of raw materials, and it will be very difficult to predict its evolution in the coming months. A low dollar is generally favorable to the dollar-denominated commodity markets. Last week, the Brazilian Real closed sharply higher at 0.1862, breaking Friday's 0.1750/0.1810 range in which it had been trading since the end of September. The fall of the Dollar allowed the Brazilian Real to rebound. The BRL/USD pair is positively correlated with coffee futures prices. A weak Real increases the competitiveness of Brazilian producers and encourages them to export. COMMITMENTS OF TRADERS The weekly COT (Commitments of Traders) report of the Commodity Futures Trading Commission (CFTC) shows all the positions opened by all market participants. The COT report is published on Friday, and reflects the open positions on Tuesday of the same week. It shows the position of commercial traders (producers, commodity buyers, ...) but also non-commercial (speculators). The net positions of speculators on the futures markets are particularly interesting to observe. The speculative net position on the coffee futures markets is down this week to 28,021 K instead of 35,421 K.
ICEUS:KC1!
by Commodity-market-review
Weekly coffee market review 11/02/2020.Support us by consulting our free daily magazines with color stock charts and weather maps on our commodity-market-review.com website. TECHNICAL ANALYSIS OF ARABICA COFFEE Last week, ICE US coffee futures closed lower at 104.35 ct/lb. The worsening health situation with a sharp increase in covid-19 cases in the USA and Europe has strongly impacted the markets last week. Due to the magnitude of the 2nd wave, Europe is reconfirming itself, this is the case of Ireland, Czech Republic, France, Germany, England, Portugal, Austria, and countries such as Spain or Italy and others are taking more and more drastic measures, such as curfews, closing bars and restaurants, or limiting people in meetings. The United States is seeing a record number of covid cases in the run-up to the election. Bars and restaurants are places of high coffee consumption, and their closure in Europe will weigh on demand. The International Coffee Organization (ICO) forecasts a surplus of 1.54 million bags for the 2019/20 season. The drought of the previous months will have an impact on the next harvest in Brazil even though the rains have now arrived. The very low Real is benefiting Brazilian coffee exporters who are taking advantage of their increased competitiveness to flood the market. According to Reuters, 64% of Brazilian production has already been sold compared to the five-year average of 53%. The depreciation of the local currency increases producers' income from dollar-denominated products. In the United States, the American election is scheduled for tomorrow, November 3, and tensions on the market are not excluded. Investors fear the possibility that Donald Trump may be declared a narrow loser and do not want to recognize the results, making the transition more complicated and delaying the vote on the long-awaited plan to support the US economy. WEATHER IN BRAZIL 90% of Brazilian coffee is grown in 4 regions: Minas Gerais, Espirito Santo, Sao Paulo and Parana. Rainfall was below normal in October in the Brazilian coffee belt. The rains were late in coming and irreversible damage is feared for the next harvest. The rainy season has now begun. Rainfall last week ranged from 50 to 100 mm. ICE US CERTIFIED COFFEE STOCKS Coffee stocks are up to 1.149 million bags of 60 Kg for 1.129 last week. ICE US stocks of Arabica coffee are below the five-year average. The low stocks may provide some support to the coffee price on futures contracts. THE DOLLAR The DXY index representing the Dollar against a basket of foreign currencies closed last week up to 93.882. The 2nd epidemic wave is scaring the market and the Dollar seems to be playing its role as a safe-haven currency. The chances of a quick agreement on a plan to support the U.S. economy are now nil. We will have to wait now for the election result, and this is beneficial to the Dollar in the short term. On the FED side, things will certainly remain frozen until the outcome of the American election. The FED has insisted on the need for a quick vote of a support plan, and assures that the key rates will remain permanently low. Last week, the Brazilian Real closed lower at 0.1726. The trend is still bearish. The rise of the Dollar, which plays its role as a safe haven, is weighing on the Brazilian Real. The BRL/USD pair is positively correlated with coffee futures prices. A weak Real increases the competitiveness of Brazilian producers and encourages them to export. COMMITMENTS OF TRADERS The weekly COT (Commitments of Traders) report of the Commodity Futures Trading Commission (CFTC) shows all the positions opened by all market participants. The COT report is published on Friday, and reflects the open positions on Tuesday of the same week. It shows the position of commercial traders (producers, commodity buyers, ...) but also non-commercial (speculators). The net positions of speculators on the futures markets are particularly interesting to observe. The speculative net position on the coffee futures market is down this week to 35,421 K instead of 40,708 K.
ICEUS:KC1!
by Commodity-market-review
COFFEE - Turning the tide ?Coffee after a 3 week structure and battle seems to be making a break towards the Fib 0.382. The higher time frames still point down. The ADX indicator shows uptrend but no strength yet (it usually has a delay on that). The COT of Sep 29 shows a lot of long orders closed (-3745) and more short open (+3065) with net long positions to 54931 compared to 61741 of the week before that. So hudge funds expect more to the down. We might have a turn of tide for coffee if this is not a false breakout, at least up to the Fib 0.382 area. I will start engaging buy orders just after the decision level (green line) is broken to the upside by solid moves, maybe wait for the day to close. Good luck traders. Note: I'm no trading expert nor have the ambition to become one! The above is just an idea that I share with the intention of attracting comments and perhaps become a better trader.
ICEUS:KC1!Long
by A_Bouras
COFFEE FUTURES - Wake up and smell the coffeeCOFFEE holded the support area of ~109.20-109.50 and made a pullback breaking the trendline (marked green on chart). However the bulls seem to be sleepy so I believe the trend continues to be bearish and we have to monitor how price will react to make our decision. Personally I'm considering a short position around the area marked on the chart. Potential profit to blue line which is the next support area. So as mentioned on the chart we monitor price and have our finger on the trigger. Good luck traders. Note: I'm no trading expert nor have the ambition to become one! The above is just an idea that I share with the intention of attracting comments and perhaps become better at trading commodities.
ICEUS:KC1!Short
by A_Bouras
Drink Coffee and make money from the market Can Coffee commodities help us to predict the stock market ? I don't know and this is based on my personal observation and not historical facts, so take it with a pinch of salt. Look at the Coffee chart carefully! It starts to reach the peak in Dec 2019 when it was at a high of 142. Two months later on 18 Feb 20, the SPX500 followed. Go google yourself and you would find a ton of media news and gurus convincing the reasons why. That is why I said reading news are more for entertainment as it leaves me nothing but more question marks in my head. Coffee finally soften its selling pressure when it went to a low of 94.75 for 2.5 months before it rebounded. Last week on 10 Aug 20, it finally broke out of the bearish trend line and look set to continue the bullish trend. However, it looks like the SPX500 has rebounded much faster than Coffee. Are you willing to bet on your cup of coffee that it will go higher from here while watching the stock market ? I leave the choice to you. Do consider your portfolio allocation to commodities, capital management, position sizing, stop loss and risk management. Trade safely
ICEUS:KC1!Long
by dchua1969