Coffee prices fall at weekend, positive trend thanks to USD; New York closes on Monday

Robusta coffee production in many countries is forecast to decrease sharply due to the impact of El Nino. In the first 7 months of the 2022-2023 crop year (October 22, 2022 to April 23, 2023), global coffee exports decreased by 6.2% (4.77 million bags) compared to the same period last year to 72.2 million bags.

World coffee prices all turned down in the closing session this week, while USDX recovered slightly, funds and speculators rushed to liquidate net positions to minimize risks because technical indicators showed that they had entered the overbought zone before and the New York floor will be closed for a national holiday on the first day of next week.

Meanwhile, Arabica coffee traders are not in a hurry to bring their goods to the floor to register for Certification because they are waiting for prices to decrease further with increasing pressure to sell the new crop being harvested in Brazil.

Meanwhile, the price of robusta coffee yesterday, June 16, set a new 15-year high when it touched the mark of 2,854 USD/ton due to technical buying orders from funds and speculators due to concerns about the supply remaining tight and supported by the ICE - London inventory report that decreased by 2,330 tons, or 2.97% compared to a week earlier, to register at 76,240 tons, a very significant decrease in the past week.

Giá cà phê hôm nay 17/6/2023: Giá cà phê

Domestic coffee prices today, June 17, decreased by 100-200 VND/kg in some key purchasing localities. (Source: YouTube)

ICE London inventories recorded a further decrease of 170 tonnes, or 0.22%, compared to a week earlier, to 78,400 tonnes (about 1,306,667 60-kg bags), a seven-week low, as of June 15. This suggests that Robusta supplies remain tight in the short to medium term. This information has contributed to supporting the increase in Robusta coffee prices.

ICE New York inventories fell to their lowest level in more than six and a half months to 546,325 bags as of June 15. This information contributed to supporting the increase in Arabica coffee prices.

At the end of the trading session on June 16, the price of robusta coffee on the ICE Futures Europe London exchange turned down slightly. The price of robusta coffee futures for delivery in July 2023 decreased by 8 USD, trading at 2,796 USD/ton. The price of delivery in September decreased by 10 USD, trading at 2,747 USD/ton. Average trading volume.

Arabica coffee prices on the ICE Futures US New York exchange decreased. The July 2023 delivery contract decreased by 2.1 cents, trading at 184.90 cents/lb. Meanwhile, the September 2023 delivery contract decreased by 2.2 cents, to 180.75 cents/lb. Trading volume was high on average.

Domestic coffee prices today, June 17, decreased by 100-200 VND/kg in some key purchasing localities.

Average price	Change
USD/VND exchange rate	23,360	0
DAK LAK	66,500	- 200
LAM DONG	66.00	- 100
GIA LAI	66,200	- 100
DAK NONG	66,700	- 100

Unit: VND/kg.

(Source: Giacaphe.com)

On Monday, June 19, the New York market was closed all day for the Abolition Day holiday in the United States; the London market was open as usual.

Despite the pause in rate hikes, the Fed expects rates to peak at 5.6% this year, meaning there will be two more 0.25% hikes in 2023. Coffee prices on the two international exchanges have the same positive trend due to the benefit of a weaker USD.

According to technical analysis, technical indicators on the robusta exchange are showing that bullish momentum is still present.

However, RSI is in the overbought zone at 72.76%, so there is a possibility of a downward correction during the session.

In the short term, robusta coffee prices are expected to fluctuate and accumulate within the range of 2720 - 2830. Robusta may increase to test the price range of 2830 - 2850 before making a correction because it has exceeded the level. It is important to pay attention to the price range of 2715 - 2720. If this price range is lost, robusta coffee may re-establish a downward trend.

Technical trend analysis shows that the arabica floor, technical indicators are showing signs of continued bullish momentum. It is expected that in the short term, the price of arabica coffee will fluctuate and accumulate within the range of 185 - 190. Arabica coffee needs to surpass 190 and close at this price to find an opportunity to conquer the old peak. On the contrary, if the 185 level is lost, a downtrend can be established.

Source