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5-1-2023 Armenia Coffee Report

Good morning and happy Monday,

It’s the May Day holiday in large parts of Europe, Central and South America. The London markets were closed this morning and many of our exporter friends will have a day off today.

Here in the Northeast, we were looking for an Ark yesterday. Central Park got over 5 inches of rain on the weekend, a month’s worth of rain in a few days. Water everywhere this morning.

The market continued to consolidate last week and the COT showed not much going on. Volumes were down all week. The RSI which had been overbought, now falls well into the middle of the range.

The COT issued on Friday April 28th for trading as of Tuesday April 25 showed long funds adding 2770 lots to be 39,555 lots long while short funds added 3178 lots of shorts and stand 19,701 lots
short. Trade sold about 500 lots for the week. Index traders were buyers of 1004. So long and short funds added similar quantities and the rest did very small amounts of trading adding to positions.

ICE warehouse stocks stood at 680,163 bags as reductions slowed a bit. Still nothing pending. There has been a total of 330 lots issued against the May contract.

Macro for the week had the dollar a bit stronger which is usually considered bearish for coffee. The US FDIC sold First Republic bank to JP Morgan Chase this morning, saving a bank that was in the headlines all week last week. The Brazil Real stands a bit stronger this morning under 5 again at 4.98842 and the Colombian Peso is a bit lower at 4695.3

Ethiopia’s coffee production was up about 3.6 percent. The ICO said the country was benefitting from a program that started in 2010 aiming to increase productivity.

We see support in July at the 200 day MA 18405 which we are testing today. Past that next support around the 18100 level. Overhead the 20000 level remains where origin steps up their selling against coffee right now.

We have the lovely Dumerso Organic Yirga Grade 2 in the warehouse if you’d like to try a sample let us know. We’d love to be of help today.

All the best,
The Armenia Team