We’ll start off wishing our friends who observe a happy and peaceful Hanukkah season.
The holiday shortened week for coffee saw some fireworks even with fewer trading sessions, which traditionally draws traders away from their screens.
Monday was a relatively quiet session in a tight range but Tuesday and Wednesday saw the market explode to the upside trading as high as 24820 in March. The running of stops at previous highs, gave the market volume to proceed and boy did it ever. We didn’t hear much new to explain what re- awakened the bulls but re-awakened they were.
In recent days there were 2 days of very large, over 70,000 bag drawdowns to the certified stocks, with corresponding rises to the pending grading of similar if not equal size. Overall the stocks were down 174,324 bags for the week to 1,600,908 bags in total and now “only” 770,486 bags of Brazil of which “only” 598,148 bags were in Antwerp. From those numbers it seems that the initial resubmission did not go well, we’ll see about this one.
There are still zero notices issued versus December C. Together with the large drawdowns the market wants you to know that coffee already here has value. This makes sense. There are reports that some shipping lanes are improving, but you’d be hard pressed to see it in the major coffee lanes. Colombia, Brazil and Asia all still having issues with Colombia and Brazil becoming harder, not easier to get your coffee shipped from those places.
The market on Friday and again this morning having trouble holding gains. Reports that the Omicron variant of the Corona virus is concerning and already we’ve seen travel stoppages from the African sites where the variant has shown up in some note. Markets across the board were slammed on Friday because of this, worried that additional steps will have to be taken and folks fear going back to a protective stance. Last week the Brazilian Real was out over 5.6+ today it’s 5.59772. Colombian Peso at 3997 it too had gone past 4000 end of the week last week, that likely brought some origin based selling.
We’ve had some nice fresh Colombia Excelso go into Continental last week. Our Bali Kintamani arrives on Dec 3, and Sumatra FTO on Nov 30th. Fresh Peru FTO arrives on Nov 26.
We would love to be of help today
All the best,
The Armenia Team