December future of coffee has been traded within a narrow range of 155-119 cents per one pound of Arabica for three weeks. Current week has brought no serious change to the situation. Factors influencing the market have remained the same.
"Bearish" factors:
1. Expectation of surplus for 4th year in a row.
2. Long-term low exchange rates of currencies of leading exporters.
3. Expectation of record crop in 13\14 in main coffee producing countries: Brazil and Vietnam .
"Bullish" factors:
1. Lower production in Central America because of damage from coffee leaf rust (decline by 12%).
2. Weak growth of consumption in main consumer countries (EU, North America, Japan), the consumption of which amounts to 55% of the total one.
3. Growing demand for Robusta and drop of its supply from Vietnam this marketing year. As a result certified storage in London is at multi-year low.
Seasonal pattern: downtrend till October.
Additional interesting information about coffee:
Main producers:
Consumption per capita in main consumer countries:
Overview prepared by the Analytics Team of Options Trade Department at Masterforex-V Academy:
