The Market Update explores how this week’s news, weather and other factors are shaping the global coffee trade.
This week offered another view into a continuingly aggressive and volatile landscape. Coffee jumps 20c week on week 322>340.
Washed coffee differentials continue to leap higher as the limited options struggle to meet demand. This has heavily influenced anyone willing to make new crop offers. Colombia trades higher daily. This, likewise, drags up any offers from the coming harvest in Costa Rica, Guatemala, etc., even though these are still six to seven months away from fruition.
Weather-wise, rain in Brazil has caused some quality concerns for this current crop, as well as the possibility that some coffee fell to the floor.
Prices for East Africa have also pushed higher. Lower grade naturals have remained firm.
Certified Coffee stocks continue to shrink as we see more coffee stopped and delivered. Importers’ “long inventories” remain very lean, and the inversion continues to bite deep. U/Z trades 22c. Z/H has also widened to 8.5c.
Forward planning remains at the core of securing reliable supply. —N.B.
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