Good morning,

We hope our weekly missive finds you safe, looking after you families and enjoying a nice cup of morning coffee. Here today those of us who are in the office are enjoying a nice Colombia Excelso medium roast. We really enjoy the flavorful brightness that roasting Colombia at this roast shade
brings, especially in the morning. Wakes us and our taste buds up!

Well we continue to trade in the “new normal” that the global Covid-19 pandemic has brought to our world. Reduced volumes in the futures markets, have made the C here rangebound. Since Mar 30th we’ve been in a range from 115 to 120 with a few extensions below and above, but the market seems to find equilibrium right around 117-119. The buying dries up as the market gets close to 120 and the selling just under 116.00. The COT just released for trading as of last Tuesday shows the funds lightened their long position just a little over 1000 lots. Interesting the May/July switch has been trading under 100 points most of the week, indicating that things are tight. Another big drawdown in certified stocks on Thursday with 41,447 bag drawdown leaving stocks at 1.905 million bags.

Before the pandemic, we thought the market was going to experience a tightness of Brazil and Colombian coffees which didn’t seem to have enough length at the ends of each of their respective crops. Since the pandemic now, we’ve seen some roasters need some coffee, mostly in the grocery chains, while others struggle with store closings, staff layoffs and a more coffee than they need, willing to sell some coffee into the market. Its’ probably helped us get through what would have been a tight position a little easier than expected. That said there are coffees, like Colombia Supremos, that remain in very tight supply with widening diffs that will likely continue until we get some of the Mitaca coffee shipping.

Around the world, shipments seem a bit delayed as supply chains deal with the challenges the pandemic provides, still for right now, coffee is shipping, eventually. It’s going to be interesting to see how a country like Colombia deals with picking the coming crop, they are going to have many challenges such as how to house the pickers, who are usually migrants from Venezuela. One exporter told me that some producers were thinking with many local shops closed, they might have more locals available for whatever work they can find and as such there might be move locals available for the harvest. Interesting times for sure.

We have some new lots from PNG Sigri Estate which we are highlighting today. AA and PB’s in Continental warehouse, samples are ready to send, and we’d be happy to share cupping notes as well. New Sumatras are now in store. Please have a look at the offer list that accompanies this report and see if there is anything of interest.

Your friends at Armenia