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1701 views October 31, 2014 posted by Maja Wallengren

MARKET INSIGHT: Dec Arabica Coffee Up 0.40 Cent At $1.88/Lb Oct 31 As Prices Stabilize In New $1.80-$2/Lb Range

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OCT 31 (SpillingTheBeans)–Arabica coffee prices closed higher on Friday at the ICE exchange in New York, with futures settling the last week and month of October firmly within the new trading range of $1.80-$2 per pound. Active December futures settled up 0.40 cents at $1.8800/lb while more forward March futures closed 0.30 cents higher at $1.9230/lb, after a month with an impressive rally that took prices to the highest levels in close to 3 years.

As rains in the world’s largest grower have eased the worst concerns in the market over the worsening extent of the damage from the most severe drought in over 70 years, prices have for now settles below the $2/lb mark. But even if some sporadic rains after close to a 2-month delay finally arrived in most key coffee producing regions in Brazil last week, significant damage has already been caused to the yield potential for the next 2015-16 harvest.

Any reports of new rain trouble in Brazil can take prices back over $2/lb and if a significant drop in yields is confirmed in the first post-flowering forecast by the official Brazilian crop forecast agency Conab next December prices could quickly move toward $3/lb as global stocks in importing countries remain low and only account for between 5 to 6 weeks worth of world demand.

OCT 28 (SpillingTheBeans)–Arabica coffee prices closed higher Tuesday at the ICE exchange in New York as rains in the world’s largest grower Brazil has eased concerns for the next crop. Active December futures settled up 1.45 cents at $1.9235/lb while more forward March futures closed 1.50 cents higher at $1.9665/lb.

OCT 24 (SpillingTheBeans)–Arabica coffee prices closed weaker on Friday but stayed over the psychological $1.90 a pound barrier at the ICE exchange in New York as rains in the world’s largest grower Brazil put pressure on prices. Active December futures settled down 1.80 cents at $1.9150/lb while more forward March futures closed 1.75 cents lower at $1.9575/lb.

OCT 23 (SpillingTheBeans)–Arabica coffee prices closed higher on Thursday at the ICE exchange in New York as traders and industry were seeking middle ground on prices after some rains eased the worst of concerns over the drought damage in the world’s largest producer Brazil. Active December futures settled up 2.20 cents at $1.9330/lb while more forward March futures closed 2.20 cents higher at $1.9750/lb, after crashing to just over $1.90/lb from last weeks highs of $2.2545/lb for December futures and $1.2910/lb for March prices.

The latest rally took Arabica prices to the highest levels in 2 years and 9 months and performed in accordance with analysis as forecast by SpillingTheBeans. SpillingTheBeans’ author and independent analyst Maja Wallengren has since last August said that prices for the time being have stabilized in a range of $1.80/lb-$2.00/lb with the spikes over $2/lb only occurring if and when fears or concerns over Brazil worsen.

Earlier this week rains were finally reported in Brazil’s main producing region of Southern Minas after a prolonged drought that has lasted since mid-August and caused a delay of 5 to 6 weeks to the onset of flowering for the next 2015-16 harvest. While the rains that started Monday have eased concerns of a complete crop failure the root systems of trees in Brazil remain in poor state and much damaged has without question already been caused. Given the severe state of damage to farms across all the Brazilian coffee growing regions, it is unlikely that flowering for the next 2015-16 harvest will be able to create the conditions for a crop above the 45M to 47M bags range.

OCT 16 (SpillingTheBeans)–Arabica coffee prices closed higher on Thursday at the ICE exchange in New York as traders and industry continue to be alarmed over the worsening outlook in the world’s largest producer Brazil. Active December futures settled up 1.10 cents at $2.1710/lb while more forward March futures closed 1.15 cents higher at $2.2105/lb. Prices stayed close to the fresh highs reached earlier this week, where December futures reached $2.2545/lb and March prices reached $2.2910/lb. The latest rally took Arabica prices to the highest levels in 2 years and 9 months.

Coffee prices have been moving steadily higher since early September when severe dryness persisted across the coffee growing regions in Brazil ahead of the onset of flowering for the next harvest. The main flowering season normally starts during the second half of September, but as of Oct. 16th the rains had yet to arrive and weather forecast call for no rains in the next 10 days either. If the rains fail to arrive in October, the entire 2015-16 coffee harvest in Brazil could be thrown into jeopardy as only farms with access to irrigation will be able to provoke a limited flowering.

OCT 10 (SpillingTheBeans)–Arabica coffee prices closed weaker on Friday but stayed over the impressive $2.20 a pound barrier at the ICE exchange in New York, holding on to most gains from Monday’s mega-rally that took prices to the highest levels in 2 years and 8 months. As fears over the growing coffee drought disaster in the world’s largest producer Brazil continued to send panic waves through the market, active December futures settled down 1.25 cents at $2.2040/lb while more forward March futures closed 1.25 cents lower at $2.2420/lb.

OCT 8 (SpillingTheBeans)–Arabica coffee prices were higher on Wednesday at the ICE exchange in New York as investor fears over the growing coffee drought disaster in the world’s largest producer Brazil weighed heavily on the market. By 11:26 a.m. EDT active Dec futures were up 2.50 cents at $2.1885/lb after earlier surging 5.05 cents to a session high of $2.2140/lb. More forward March futures were 2.40 cents higher at $2.2260/lb after reaching an intra-day high of $2.2510/lb. Monday’s mega-rally that took prices to the highest levels in 2 years and 8 months.

For more analysis, don’t miss our special report “Rain And Drought Put Brazil’s Coffee Crop In Doubt” for FREE at: http://spilling-the-beans.net/special-report-rain-and-drought-put-brazils-crop-in-doubt/

OCT 7 (SpillingTheBeans)–Arabica coffee prices settled lower on Tuesday at the ICE exchange in New York after profit taking by both origin and speculators following Monday’s mega-rally that took prices to the highest levels in 2 years and 8 months. Active Dec futures settled down 4.45 cents at $2.1635/lb while more more forward March futures closed 4.25 cents lower at $2.2020/lb.

*Arabica Coffee Prices Go CRAZY Surge 19 Cents To 2 1/2-Year Highs, Dec Hit 2.2550/Lb In Early Trade Oct 6
OCT 6 (SpillingTheBeans)–Arabica coffee prices started the week with a CRAZY rally on Monday, taking Active December futures up a full 19 cents per pound in early trade to hit $2.2550/lb while March futures — against which contract most of the highest quality Arabica beans from Central America and Mexico are traded — hit an intra-day high of $2.29 per pound. Monday’s prices were the highest in the New York Arabica coffee market in 2 years and 8 months, since February 2012 when prices traded between $2.00-$2.21/lb, while in January from month Arabica futures traded between $2.15-$2.35/lb.

Renewed fears over what is becoming a growing drought disaster in the world’s largest producing country Brazil continued to rattle the market and led to a wave of panic buying. Active Dec futures settled up 14.30 cents at $2.2080/lb while more more forward March futures closed up 14.15 cents at $2.2445/lb, after reaching an intra-day high of $2.29 per pound. On Feb. 7, 2012, the then front month contract closed at $2.2095/lb.

*Arabica Coffee Prices In CRAZY Surge To New 2 1/2-Year Highs Oct 6, Dec Up 19 Cents To 2.2550/Lb In Early Trade (5:38 a.m. EDT)

OCT 3 (SpillingTheBeans)–Arabica coffee prices closed a week-long spectacular rally slightly down, but holding on to most gains and settling firmly above the $2 per pound psychological barrier at the ICE exchange in New York. Active December futures settled down 2.10 cents per pound higher at $2.0650/lb on Friday after a week of continued panic in the market over the growing concerns of a second year of a drought-damaged crop in Brazil sent traders into a buying frenzy. More forward March futures closed down 2.20 cents at $2.1030/lb. This week’s high of $1.1750/lb for March futures were the highest in over 5 months and close to the 2-year highs seen last April.

MARKET INSIGHT: Arabica Coffee Prices SURGE In Spectacular Rally On Brazil Panic Oct 2, Dec Settle Up 8.20c At 2.0860/Lb

OCT 2 (SpillingTheBeans)–Arabica coffee prices made a spectacular performance on Thursday at the ICE exchange in New York as panic in the market over the growing concerns in Brazil sent traders into a buying frenzy. Active December futures surged a stunning 13.35 cents per pound to an intra-day high of 213.75 c/lb before settling up 8.20 cents per pound higher at $2.0860/lb. Futures opened flat on the previous session, but quickly moved a tad lower in an attempt on profit taking following the last four sessions which have continued to extend gains from this week’s rally. But prices very quickly started to climb in over-night trade, with the more forward March futures rising 13 cents to an intra-day high of 217.50 c/lb before closing up 8.00 cents at $2.1250/lb.

*For more MARKET ANALYSIS and recent Arabica prices, please see: http://spilling-the-beans.net/market-analysis-arabica-coffee-prices-surge-back-over-2lb-in-september-are-prices-in-new-1-80-2lb-range/

*MARKET INSIGHT: Active December Arabica Coffee Prices SURGE Ahead In Rally, Now Up 11.15 Cents At 2.1155/Lb Oct 2 On Brazil Panic After Reaching New High Of $2.1375 per pound. More forward March futures were up 11.20 cents at $2.1560/lb after reaching a high of $2.1750/lb. (07:30 EDT)

OCT 2 (SpillingTheBeans)–Arabica coffee prices continues to rally in early trade Thursday at the ICE exchange in New York as growing concerns over the ongoing drought damage in Brazil sent panic through the market. Active December Arabica coffee prices were up 5.35 cents per pound higher at $2.0575/lb per pound while more forward March futures were up 5.20 cents at $2.0970/lb, moving back close to the 2-year-highs seen earlier this year. (06:15 EDT)

OCT 1 (SpillingTheBeans)–Arabica coffee prices continued to rally on Wednesday, settling above $2 per pound at the ICE exchange in New York as concerns over the ongoing drought trouble in the world’s largest producer Brazil continued to shake up the market.

Active December Arabica coffee prices settled 7.05 cents per pound higher at $2.0040/lb per pound while more forward March futures also closed up 7.05 cents at $2.0450/lb, moving back close to the 2-year-highs seen earlier this year.

Brazilian growers had been hoping for better and more consistent rains during the month of September, where the main flowering for the next harvest traditionally starts, as trees and root systems in farms were in poor shape following the most severe drought in over 70 years. The drought which started last February has already caused losses of at least 30 percent to the recently completed 2014-15 harvest. As flowering for the next 2015-16 crop is scheduled to start soil conditions continue to be poor. While the flowering process can still recover and develop into relatively productive yields, agronomists caution that for each day and week that goes by without rain from now, the losses and damage to the next harvest will grow.

“That there is damage to the next crop is inevitable, we already know that, but as the season progress without anything to improve the dryness in the coffee regions the predictions for the next Brazil harvest continues to look worse and now we are in October,” one green coffee trader in New York told SpillingTheBeans.
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*For SpillingTheBeans’ full 2014-15 coffee market outlook and forecast for the coffee year ahead, see: http://spilling-the-beans.net/video-the-world-is-running-out-of-coffee-market-insight-live-from-coteca-in-hamburg/

*For more market analysis on the underlying fundamentals, please see: http://spilling-the-beans.net/market-analysis-world-coffee-market-headed-for-new-deficit-in-2013-14-cycle/

Happy Coffee Drinkingheart

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