May 27, 2024

Weekly Coffee Market Recap and Commitment of Traders Numbers 27 May 24

By Oliver Broster

Both markets were closed on Monday 27th May 24 for National holidays.

New York

The market moved 10.10 c/lb. higher on the week (+4.85%).  Open interest was increased by 8,191 lots through to 23/05 indicating participants entering the market.  Volume was up on the previous week by 32%.  Both the increase in volume and the increase in the open interest indicate increased participation and that there were new players joining the move.

London

London was up by $374 / MT (+10.63 %) which is significantly more than London in percentage terms.  Open interest increased by 9,185 lots or +10.86% and at the same time volume was up by 35%.  At the same time outright volume was up by +47%.  This indicates increased participation in the move and that this participation was probably centered / focused on the outright price.  

Coffee Commitment of Trader Numbers

New York

The Managed Money position (MM), they decreased their net long position by -780 lots (-95 long and +685 short) making their net long +53,289 lots long.  Managed money traders on the long side increased by +6 and on the short side – 5.

The Producer Merchant position (PM) increased their net short position by -3,956 lots (- 1,587 lots long and +2,369 lots short) making their net short position -51,948 lots short. 

In comparison with a year ago the PM position is-

The PM short (assumed to be purchases that are hedged by the trade / producer merchants) remain behind where they were last year.  

London

The MM increased their net long position by +930 lots (+14 lots long and -916 lots short) making them net long + 22,370 lots long.  At the same time the MM traders on the long side decreased by – and on the short side by -1. 

The PM increased their net short by -1,621 lots (+5,035 lots long and +6,656 lots short), this making their net short position  -26,483 lots.

In comparison with last year the PM position is:

The PM long position is ahead of where it was last year and the PM Short remains well behind.  Given the context of the physical market both this year and last year this provides real food for thought, the implication being the trade has sold more to industry and bought less from exporters / producers.

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  • Weekly Coffee Market Recap and Commitment of Traders Numbers (Wk ending 07/06)

    New York

    Another strong week in New York (the fifth positive week in a row) the market closed + 3.65 c/lb. (+1.65%).  A big day on Fridays as the market moved from 232.50 c/lb to 224.70 c/lb ( -7.80 c/lb.) this was on much higher volume than during the rest of the week.  Open Interest (OI) through to Friday increased + 13,605 lots (+5.53%), it will be interesting to observe the OI numbers for Friday which will be released early in the afternoon (UK time) on Monday.

    The volume increased by 62% in comparison with the previous week.  The major change being the increase in the spread activity during the week.  At the same time the OI in the first position fell from 88,373 lots (31/05) to 78,456 lots (06/06) a decline of 9,917 lots.  This within the context of an increase in the overall OI of 13,605 lots.

    London

    The move in London was stronger than in NY and the market closed up + $ 141 /MT (3.54%).  This was the fourth consecutive week of gains in London.  Open interest was up through to Thursday +4,053 lots confirming increasing participation in the move, and whilst there was a significant sell off on Friday from an open of $4,280 / MT to a close of $4,125 / MT down - $ 155/ MT, the volume was not elevated. 

    Volume was up 20% on the previous week and again the major contributor to this was the spread volume which increased +36.34% in comparison with the previous week. 

    Coffee Comitment of Traders

    New York

    The Managed Money (MM) increased their long position during the week by +6,207 lots (+4,635 lots long and – 1,572 lots short) making them net long +63,220 lots long.  8 MM traders joined on the long side and 2 MM traders joined on the short side.  Earlier this year we reached a high of net long +72,818 lots on the 16/04, the current reporting number is the 5th highest / ranked since Jan ’22, all higher occurrences occurred in Apr’24.  The implication being that the probability of MM further increasing their long (whilst not implausible) is declining. 

    At the same time the Producer Merchants increased their net short by -4,229 lots (+5,310 lots long and + 9,539 lots short) making the PM Net short -59,702 lots. 

    In comparison with the same period last year:-

    London

    The MM increased their net long position by +3,029 lots (+2,811 lots long and -218 lots short, making them net long +28,625 lots long. 

    The PM increased their net short position selling -2,299 lots (-2,266 lots long and + 33 lots short) making their net position -32,735 lots short.

    In comparison with same period last year:-

    Unlike in New York both the PM Long and short remain behind where they were at the same time last year and the PM Short (hedges of purchases from origin) remains significantly behind.

     

     

     

     

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