After another failed bullish attempt, New York arabica is settling down. The market remains vulnerable to the ups and downs of crude oil, CRB index, and exchange rate. Financial order prevails, which makes the market much more volatile. Amid all this nervousness, coffee seeks to frame some lines of action, which serve as a reference in the short term for arabica on ICE Futures US. The market has managed to move away from the bottom at 100 cents per pound. It is good to remember that the May/20 position was trading at 101.40 cents on March 17. However, it was not successful in sustaining the level of 120 cents, even after exchanging hands at 130.65 cents on March 26. In short, a month of March with a wide range of oscillation, but marked by recovery of international coffee prices.
Thus, coffee starts off the month of April finding apparent short-term support, given the fears around the supply of milds and the decline in ICE certified stocks in NY – below 2 million bags. On the other hand, coffee remains without strength to sustain more significant gains, amid other things, due to the shadow of Brazil’s 2020 record crop. It is good to remember that conillon starts to be reaped now in April, and arabica coffee from next May.
Of course, the effects of the coronavirus crisis on the world economy also inhibit considerable price highs. The trend is that coffee seeks, at first, to consolidate lateral references. The supply progress of new Brazilian coffee tends to put pressure on NY and send the market more strongly towards the lower band.