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Arabica Futures Slump In Session Dominated by Rainfall Brazil, Speculators Cut Long Positions

By: Diana Delgado, Contractor

Arabica Futures Slump In Session Dominated by Rainfall Brazil, Speculators Cut Long Positions

 
  • Diana Delgado
  • Latin American correspondent
  • diana.delgado@stonex.com

Arabica Futures Slump In Session Dominated by Rainfall Brazil, Speculators Cut Long Positions

Arabica prices on the InterContinental Exchange were trading 13.25 lower for the December contract, last seen at 244.20 in a market dominated by news that rainfall is expected in Brazil and speculators cutting net long positions.

The December contract traded low today after having rising in Friday’s session, when it had ended nine consecutive sessions of falls

The December contract traded as high as 253.85 and as low as 243.34. Volume was heavy with almost 17,500 contracts traded so far.

In today’s news, rainfall is expected in key coffee regions of Brazil,  which could help the current crop flowering, traders said. In addition, ICE Arabica coffee speculators cut their net long positions by 924 contracts to 40,724 in the week to October1.

In addition, the International Coffee Organization said global green bean exports in August 2024 totalled 9.91 million bags, up 8.8%  compared with 9.11 million bags in the same month last year, the ICO said today.

This is the tenth consecutive month of positive growth, resulting in the cumulative total for coffee year 2023/24 to August 2024 being up 10.5% at 113.81 million bags as compared with 102.99 million bags over the same period a year ago, according to the latest outlook report.

The Robustas was the main group responsible for the overall strong growth seen in August 2024, accounting for 59.8% of the 0.8-million-bags net gain in total exports.

Exports of the Colombian Milds increased by 26.7% to 1.05 million bags in August 2024 from 0.83 million bags in August 2023. The latest jump in the exports was driven by Colombia, the group’s largest producer and exporter, with its August 2024 exports up 27.9% to 0.95 million bags as compared with 0.75 million bags in August 2023.

Robusta futures are also lower today, following the direction of the Arabica market. The November contract is falling $184/tonne to $4,883 per tonne. It traded as high as $5,050 and as low as $4,866.

Friday’s news that the strike of some US port workers ended is also providing a relief to the US market. The strike was hitting all East Coast and Gulf Coast. 5 of the 10 major ports for coffee in the US, which would have created a shortage of coffee in an already tight market.

Crude oil prices recover slightly for the third consecutive session.  Brent prices rise 1.67 points to $79.72/ per barrel. WTI is rising 1.72 points to $76.08 per barrel.

The Dow Jones Industrial Average was down 116.92 points to 42,236.81. 

  • Coffee

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