Arabica Futures Firm as Robusta Prices Soar CoffeeNetwork - Arabica prices on the InterContinental Exchange were trading 5.60 higher for the March contract, last seen at 185.60. Volume was good with 11,113 contracts at the time of writing.
Arabica futures are very strong today as the market reopens after yesterday’s closure for the Martin Luther King holiday. While the market remains void of any major fundamental news, it is the Robusta market that is seeing the bullish factors influence the direction of both markets today. The global coffee sector continues to monitor the maritime transport complications caused by the Houthi attacks in the red sea. As previously reported by CoffeeNetwork, this has caused significantly increases in freight rates, raising costs for dealers and European roasters. Technically, good support is being observed below the 180 level, which has generated good buying from speculators. While the strengthening of the H/K switch accompanies the bullish sentiment. Later this week, CONAB will release their first estimate of Brazil’s 2024-2025 coffee crop.
Robusta futures are rallying today, hitting a 16-year high after reports have circulated that producers in Vietnam have stopped sales in anticipation of better prices. The harvest, which is estimated to be 7% smaller than the previous one, has caused producers to hoard coffee. Historically, a pickup in selling takes place before the Tet holiday in Vietnam, which will start early next month, however producers have alternate crops, such as the Durian fruit, for cash flow. It is also important to note that we are in peak harvesting time, so the fact that they are able to hoard the coffee and not run out of room for storage is confirmation to lower yields.
Commodities are mixed today.
Brent Crude Oil rose 0.56% to 78.59 and Spot Gold Futures fell 0.90% lower to 2,038.14.
The Dow Jones Industrial Average ticked 0.63% lower to 37,354.56 and the Stoxx Europe 600 Index was last seen at 471.60, down 0.55%.
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