OfBusiness Coffee Dailies | 19th July 2023

Price

The prices of various coffee grades at Chennai Port are as follows:

• Robusta G1: 18-16 grade is priced at 2860 USD per metric ton.
• Robusta G2: 16-14 grade at a cost of 2770 USD per metric ton.
• Robusta G3: 14-12 grade at a cost of 2690 USDper metric ton.
• Arabica coffee is priced at 5035 USD per metric ton.

Demand and Supply

• Coffee price settlement on Tuesday showed an uneven pattern, with arabica prices being bolstered by concerns over potential delays in the coffee harvest due to heavy rains in Brazil.
• Last week, Minas Gerais region in Brazil received 5.1 mm of rain, which was 850% of the normal amount. Minas Gerais produces around 30% of Brazil’s arabica coffee. Due to the recent increase in robusta coffee exports from Brazil, robusta prices have been affected negatively. Additionally, robusta coffee supply is currently constrained, with stockpiles reaching a record low of 5,275 lots on Tuesday.

News

• London futures closed at $2,534.00, down 0.58% from the previous value of $2,549. The trading range for the day was between $2,518.00 and $2,559.00.
• US Coffee C Futures increased by 0.02%, closing at 155.83. The trading range for the day was between 155.08 and 157.97.
• A collaborative effort by coffee-related organizations in the US and Canada will benefit two inspirational coffee individuals struggling with mental health crises and debt through the Hot Medicated Summer raffle.
• Tight global robusta coffee supply supports price surge. Vietnam’s coffee exports down 3.1% YoY in H1 and harvest expected to drop over 7% to 1.67 MMT, smallest in four years.

OFB’s Opinion

• Consider the potential impact of the excessive rainfall in Brazil on crop harvests, as it could potentially result in a decrease in coffee supply and subsequent price increases.
• It might be worth noting that with the demand-supply gap narrowing, prices could potentially decrease even more.