Both arabica and Robusta prices fell slightly across the course of the week but traded relatively flat with buyers and sellers easily able to absorb each other's demand across the course of the week.
Arabica futures for the front month KCK23 May contract closed down a little over USC 6/lb (3.5%) at 175.5 USC/lb overnight in New York, posting a 4-week low. Prices briefly made a push midweek to break out of the recent downtrend but met resistance at the 184 USC/lb level as speculators looked to sell after a period of short covering appeared to end.
Robusta prices settled overnight in London relatively unchanged over the course of the week. The front month RMK23 contract for May continued to trade within a relatively narrow band of around $60 USD/kg (~2.75%). Following the trend set by arabica, prices attempted to break out nearer the end of the week but met resistance at just under the $2,190 USD/lb level.
Fundamental indicators for arabica prices remain mixed. Positive reports from Honduras of a 32% year-on-year increase in exports for February and improved weather forecasts for Minas Gerais in Brazil, were both bearish for prices. On the flip side, ICE inventories feel to a 2-1/2 month low and smaller supplies from Colombia were bullish indicators. Reports of smaller global coffee exports from the International Coffee Organisation (ICO) for the October-December period echoed the reports from Colombia, as did reports from Brazil and Guatemala.
Although Robusta inventories saw some modest growth last week, rising to a 2-1/2 month high of 7,400 lots, prices continue to find support on supply concerns. Vietnam reported a 34% year-on-year drop in exports for the year to date, and predictions for the 2023/24 harvest show a deficit of 5.6 million bags for the 2023/24 harvest due to excess rainfalls across growing regions in Indonesia.
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