World coffee prices jumped on both exchanges in the first session of the week, early July. Analysts said that funds and speculators returned to buying after cautiously liquidating in previous sessions when the USDX continuously dropped, causing speculative capital to shift away from commodity exchanges.
ICE – London inventory report on the first day of the week (July 3) decreased by 50 tons, or 0.05% compared to the previous day, down to 73,900 tons.
Today, July 4th, the New York market is closed for Independence Day, all day, no trading. The London market will close 30 minutes early.
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| Domestic coffee prices today, July 4, continued to increase by 700 VND/kg in some key purchasing localities. (Source: Lecafebmt) |
However, the weather in the coffee growing areas in southern Brazil is forecast to be favorable for farmers to boost the harvest. There is also no forecast of frost in the main coffee growing areas of this country on the full moon day of winter in July. It is expected that the abundant new crop of coffee from Brazil will soon be sold to support the consumer market to increase supply, offsetting the scarcity of goods from other major producers, such as Vietnam and Indonesia.
At the end of the trading session on July 3, the price of robusta coffee on the ICE Futures Europe London increased. The price of robusta coffee futures for delivery in September 2023 increased by 47 USD, trading at 2,538 USD/ton. The price of futures for delivery in November increased by 46 USD, trading at 2,437 USD/ton. Trading volume was above average.
The New York Arabica Coffee Futures Exchange increased, the price of Arabica coffee on the ICE Futures US New York for September 2023 delivery increased by 1.5 cents, trading at 160.50 cents/lb. Meanwhile, the December 2023 delivery increased by 1.6 cents, trading at 159.7 cents/lb. The average trading volume is high.
Domestic coffee prices today, July 4, continued to increase by 700 VND/kg in some key purchasing localities.
Unit: VND/kg. (Source: Giacaphe.com) |
Markets are generally more positive about the prospect of higher interest rates due to the global fight against inflation. A series of important economic data will be released this week, especially the US jobs report. A positive jobs report will help to solidify another interest rate hike in July.
In the robusta market, according to the General Statistics Office of Vietnam, coffee exports in June were estimated at 150,000 tons, up 0.1% over the previous month, bringing coffee exports in the first 6 months of the year to an estimated 1.016 million tons (about 16.9 million bags, 60 kg bags), down 2.2% over the same period last year. The above information contributed to curbing the decline in robusta coffee prices.
According to technical analysis, technical indicators are showing that the downward momentum is still there. It is expected that in the short term, robusta coffee prices will fluctuate and accumulate within the range of 2450 - 2530. Robusta prices need to increase above 2530 to have a chance to increase and recover. On the contrary, it is necessary to pay attention to the price range of 2445 - 2450. If it falls below this range, robusta coffee prices may continue to decline.
For the arabica market, according to information from FNC – Colombia reported a sharp increase of 22% in coffee exports in May compared to the same period last year and the Brazilian government announced a record funding (worth about 76 billion USD) to promote sustainable coffee production. This information continues to put downward pressure on arabica coffee prices.
According to technical analysis, RSI is approaching the oversold zone and is at 30.06%. Technical indicators all show that the downward momentum is still there. It is expected that in the short term, the price may continue to decrease to probe the support zone of 155 - 157. However, the possibility of a technical recovery correction soon cannot be ruled out because the price has approached the oversold zone very close.
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