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Daily Coffee Report - 06/04/2024

By: StoneX Coffee Team, Softs Coffee Miami

Coffee Futures Settle Higher

 

Arabica coffee futures extended further to the upside as the first session of the month reflected 2,773 new longs yesterday. Prices showed good support above the 8-day moving average in the region 226 and additional buying interest after the market traded through 230. After today's settle of 735 points higher for the main contract Jul24 at 233.90, traders will keep an eye on the market behavior around last week's high of 237.75 or any technical signal below near supports of 230 and 226. Total volume was moderate with a total of 61,109 lots, including 18,577 switches. Certified stocks on Tuesday increased 10,155 bags, now at a total of 790,738 bags. Yesterday, the exchange began to publish what it has identified as “Transition Stock” in European ports. Transition stocks are defined as non-EUDR compliant certified stock stored in EU ports with a bill of lading on or after June 29, 2023 and prior to December 31, 2024. The current total of transition stock sits at 656,945 bags or 83% of the current certified arabica stock. The market has begun to digest this development and is driving the strength in the calendar spreads through the end of the year, notably arabica Sep/Dec and Dec/March, and Robusta Sep/Nov and Nov/Jan.  

Robusta July contract settled at $4332 with a 4340/4193 range. Market continues to rally with physical issues dominating the market. $4338 is the next upside target base 2nd month continuation. With structure in a strong inversion its putting further stress on any shorts needing to roll ahead of FND at the end of this month. Jul/Sep traded 6.4k lots between 139/158. Robusta Jul24 4150 puts vs 4300Δ34 traded 1000x @ 98, Robusta Sep24 3800/4300 callspread vs 4170Δ24 traded 1000x @ 245.

At the time of writing

USDBRL 5.2871 +0.81%

USDCOP 3929.6 +1.86%

Coffeeorderdesk@stonex.com    

Miami                                                London                                Brazil                           

305-925-4847                                  +44-203-580-6099            +55-11-3509-5426     

ICE Arabica

Volume:

61,109

 

ICE Robusta

Volume:

23,439

 

Brazil Arabica

Volume:

1,155

Arabica-Brazil Arbitrage

Arabica-Robusta Arbitrage

Arabica Switches

Robusta Switches

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