As the global markets cautiously returned to action after the holiday period, the coffee industry witnessed several key developments:
☕ Coffee Price Movement: Coffee prices experienced a decline, influenced by multiple factors. The completion of the harvest in Brazil and the weakening of the Brazilian Real (BRL), touching 5.0 against the US dollar, added pressure to the market.
🌦️ Brazil's Weather: Brazil, a significant player in the coffee industry, observed widespread but light showers across all regions, promoting favorable blossoming. However, the forecast suggests very light rains for the coming week, and long-term weather patterns must be monitored, particularly for dry weather concerns in September and October. The potential compromise of blossoming is a growing concern if regular rains don't return soon.
📉 ICE Arabica: The ICE Arabica market found itself hovering around the 150.00 mark, with a trading range of 147.20 to 157.60 over the past six weeks. The strength of the USD, reaching 2023 highs, is creating challenges for commodities. Certified Arabica stocks hit a yearly low, while positive flowering in many Brazilian growing areas has generated mixed sentiment. The market is in a consolidation phase, awaiting a breakout.
📊 Technical Levels: Support levels: 147.20, 143.00, 122.50; Resistance levels: 157.60, 166.65, 173.95.
🇧🇷 Local Market: In Brazil, the coffee market had a subdued week due to the observance of both US Labor Day and Brazilian Independence Day. Farmers, adopting a defensive stance on the selling side, witnessed limited trading activity during the week.
🌦️ Weather in Brazil: Recent rainfall in the past two weeks has led to favorable flowering in many Brazilian coffee regions, a positive sign for the industry.
🌐 Export Market: Cecafe updated August export figures to 3,805,743 bags/60kg (daily report issued on Sep 8th). The industry appears to be waiting for lower prices, with businesses taking positions opportunistically.
The coffee market continues to navigate through various dynamics, from weather patterns to currency fluctuations, impacting prices and trade activities. Stay tuned for further updates as the industry evolves. ☕📈🌱