The Arabica coffee futures declined down to another local low around 113 cents per pound. All the attempts to recover amid expectations of dry weather to favor the new crop were wasted by new weather forecasts predicting humid weather conditions with possible rains.
At this point, the market is driven by the same factors:
Bearish drivers:
· The 4th consecutive year of global production surplus.
· Record-high yields.
· Harvest recovery in Columbia.
· Massive currency devaluation in coffee-exporting countries.
· Good prospects for the Vietnam ese harvest.
· Economic slowdowns in major coffee-consuming economies like the EU, the USA and Japan.
Bullish drivers:
· Local weather fears.
· Diseased coffee plants in Central America.
· Higher demand for Robusta amid export cuts by Vietnam .
Seasonality
The winter seasonal growth is about to begin.
The review is brought to you by the Commodity Trading Department of Masterforex-V Academy.
