MILAN – Coffee futures prices hit new highs, with Arabica at levels not seen since the turn of the last century. Yesterday, Monday 25 November, New York and London continued their rally driven by fundamentals and uncertainties on the EUDR front. In New York, the March contract gained a further 270 points to close at 304.80 cents, a new high since May 2011.
According to the latest Commitment of Traders report from the Ice Arabica, the Managed Money fund increased their net long position by 5.8% over the week of trade leading up to Tuesday 19th November 2024; to register a new long position at 60,510 lots.
The Index Fund sector of this market increase their net long position by 1.9% to a new net long position of 52,792 lots.
Over the same week, the Non-Commercial Speculative marginally increase their net long position by 1.26% to a new net long position of 40,747 lots.
The contract for December delivery, which now attracts minimal volumes, surged to an historic high of 308.35 cents. This is the highest price for the front month since the 29 May 1997, when the front month peaked at 314.80 cents, only to fall sharply back into negative in the following days.
At the time, the surge was driven by the continuing imbalances caused by the frost and drought in the middle of the decade and the announcement of a sharp drop in production in Colombia.
This year, Brazil is again facing a severe drought, which has already at least partially affected the Arabica production potential for the next harvest.
Rains in October led to an “excellent flowering” of the trees, Rabobank analyst Guilherme Morya wrote in a report, but “there are now fears that the flowers will not fixate on branches, putting the crop in danger as flowers later develop into the cherries that contain the beans.”
Meanwhile, logistical bottlenecks continue to penalise exports, which have reached record levels this year. According to data provided by Cecafé, as many as 1.7 million bags of green coffee (equivalent to 5,203 containers) remain stuck in Brazilian ports due to infrastructural deficiencies.
On the Robusta front, prices approached the contract highs reached in September. The January contract at the Ice Robusta appreciated 2.5% (+$125) ending the day at $5,110.
