Arabica coffee futures for December delivery settled 460 points lower at 185.80 cents a pound. Volume reached 63,150 contracts boosted by 22,034 switches. Fund and speculative selling continued to be encouraged by the fundamental and technical factors. Rains in Brazil across the main coffee producing areas have improved the conditions for the development of the next crop. The technical breaking of the recent support levels and a large liquidation of the structures added more weight on the price action. The nearby active December / March structure lost 2.20 cents premium ending at 3.25 cents. This structure had attracted huge speculative participation following a firm trend and reaching 10.00 cents premium on Oct 6. The fall of the differentials in origin reversed the trend completely and has influenced significantly on the backwardation of the forward curve. Certs stocks declined 1,160 bags to 387,705 bags. Pending grading 646 bags. No grading
today. Robusta JAN23 contract settled at $1948 -5 with a 1971/1923 range. Lots of activity in the market today with Specs being the main sellers pushing the market lower to test new lows. Roaster buying scale down in good size absorbing some of this selling pressure. Expectation is Non comms have flipped their positions to nett short of both markets. With the last trading day pre FND on the NOV22 contract many traders were squaring up their books rolling positions to MAR23 and further down the board. NOV/JAN had a 3/20 range on 3789 lots. Just over 4k lots of EFPS on NOV22 also. The JAN23 1950/2100 cs was in Vouge trading 4000x @ 48.
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Arabica coffee futures finished a little lower after consolidating near recent lows. The benchmark contract for December delivery settled 40 points lower at 190.50 cents a pound. The activity was boosted by spreads trading. Volume reached 41,387 contracts including 13,557 switches. Speculative buying supported the market as the fund’s liquidation appeared becoming to an end. Last Friday’s COT report showing the funds reducing the net long position by more than 18,000 lots as of last Tuesday is an indication that the fund’s position could be almost flat by the end of the week. Oversold prices discouraged the speculative selling as well. The certified stocks declined 1,712 bags to 388,865 bags. Pending grading: 646 bags. No grading today.
Robusta JAN23 contract settled at $1953 -43 with a 2022/1946 range. Flat price broke recent lows with continued speculative selling coupled with light commercial selling. Both markets tried to hold on to early gains but once the US came online the tone was reversed. Volumes were strong with 11k Jan23 trading and 3.3k lots of Nov/Jan going through which is expected to further reduce the Nov22 OI ahead of FND on Wednesday. Option market was a lot quieter vs previous sessions with the most notable trade being 250x JAN 1900 p LIVE @ 50 and 250x Jan23 2200/1850 STRANGLES LU @ 54. |
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