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10-11-2021 Armenia Coffee Report

Good Day,

No Holiday for us we’re all here working. Not sure all the warehouses, shipping lines are though, keep that in mind today (Monday the 11th).

The market was dominated by expiring options last week. Nov serial options had good open interest at many of the nearby strikes giving trades a chance to run some of them making traders increase and decrease their delta coverage. In the end it was the 200.00 strike that the market chose to settle by. The market went lower early in the week as expected rains came throughout the Brazil coffee producing areas, in some places a little more in some a little less but, the point is we became more seasonable with more rains expected even into this week. That helped push the market into a test of the 190.00 area in Dec which held this time. What many continue to point out is while the rains are more “normal” the whole of the market is far from it. Supplies, depending on what you want and where you want it is in an interesting state, especially still on the west coast where buyers have had to go shopping in the spot market to make up for late arriving parcels

Origin continues to experience severe logistical challenges. New origins popping up with problems every week now. Most recently Brazil has become like many of the Asian ports with difficulties obtaining containers, bookings being rolled over, and steamship companies not honoring freight carriage agreements (you get a booking, but it just keeps rolling over). Another sign of what these problems are doing here is that the C stock continued to see good drawdowns. Stocks ended the week at 1,943,189 after a 4873 bag bump on gradings on Friday. That number is 133,368 bags lower than the week before. There are currently 1,064,895 bags of Brazil there of which 768,459 bags are in Antwerp, both of those numbers are lower than the week before. What’s up is the number of bags pending grading now 27,169 bags which the market is grateful for it would seem, majority of those are in Antwerp to no one’s surprise.

The COT issued Friday Oct 8 for trading as of Tuesday Oct 5th showed long funds bought 3840 lots and now are 59,735 lots long and short funds added to their shorts selling 967 lots to stand at 13,704 lots short. Trade did not do much last week on the aggregate, as both longs are shorts were down nearly equal amounts. Having corrected the market now needs to show it can sustain prices over 200.00 for any length of time.

We have fresh Colombia Supremo 17/18 now in Continental and we have fresh Excelso EP now arrived, waiting on Continental to go and pick them up. We have some nice fresh HB Quetzeltenango also in the warehouse now. Nice Brazils in store including some RFA 2/3 MTGB. If you use robusta we have some lovely Wet Polished Vietnam for your roasting enjoyment.

Please let us know how we can help you today, or tomorrow if today is a holiday for you.

All the best,
The Armenia Team