Coffee Futures Move Higher with Less Volume
Coffee futures settled higher today again, with the active March 2025 contract trading to a high of 297.50, making it a now 56.7 cent gain on the month so far since the low on November 1st of 240.80. Commercial activity remained light, and most participants will view today’s action as a break despite the higher close. Open interest in December 2024 began the day at 2,243 contracts with 87 lots traded today and 5 delivery notices issued.
So where do we go from here? Central American exports have been delayed due to a late harvest, but we expect shipments to begin to ramp up in December/January. Colombia has a good crop and is getting a demand boost from importers covering Central shorts. Brazil in 24/25 produced 2mm more bags than in the last crop year 23/24 and has exported 11.9mm bags of arabica from July to October, compared with 10.7mm bags for the same period in 23/24. For the past five years, Brazilian green coffee exports have peaked in November/December, and this year we are on track for the same trend. This is known as “seasonality”. Currently, we are on the same pace as the 20/21 export year where Brazil exported 36.9mm bags of arabica with 47.6mm bags of production.
We began the year with critically low destination stocks, and it will be tough to rebuild in the next crop year with current projections for 25/26 Brazil production. Exports out of all origins this year will be frontloaded, and we will likely see a tight cash market from May 2025 onwards on the break from old to new crop, reflected in the futures curve from May to December 2025. In the current market environment, it is more important than ever to implement proper risk management, engage with strong counterparties, and rely on trusted sources of information.
At the time of writing this:
USDBRL 5.8153 +0.75%
USDCOP 4,406.95 +0.29%
Miami London Brazil
305-925-4847 +44-203-580-6099 +55-11-3509-5426
ICE Arabica
Volume:
36,490
ICE Robusta
Volume:
11,159
Brazil Arabica
Volume:
1,141
Arabica-Brazil Arbitrage
Arabica-Robusta Arbitrage
Arabica Switches
Robusta Switches
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