Physical coffee market reacts in early November

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Physical market reacts in early November

The physical coffee market is showing a reaction in early November, after the strong accumulated lows in the months of September and October. Fine and good arabica cups find support in the high dollar and with the ICE on the sidelines. Weak differentials show the pressure of the physical supply, which makes the internal physical market very vulnerable to external variables.

Good cup from the south of Minas is trading at BRL 530 per 60-kg bag in early November. Although far from the level of BRL 600 idealized by growers, the market shows a reaction when compared to the average price reached in October (BRL 518.37).

Fine cup from Cerrado de Minas reaches BRL 555 a bag and also seeks to recover from the strong tumble accumulated in the previous two months. In the Mogiana region of São Paulo, good cup ranges from BRL 530 to 540, while fine coffee reaches BRL 555 to 560 in the physicals. Forward sale commitments for Sep/2021 are indicated between BRL 585 and 590 for fine cup in Cerrado/Mogiana, and between BRL 555 and 560 for good cup in the south of Minas. The idea for Sep/2022 ranges from BRL 575 to 610 per bag, depending on description and origin.

Rio coffee in the Matas de Minas region is pegged at BRL 385 per bag. This description shows difficulty in sustaining gains due to the slow domestic demand. Conillon, on the other hand, dropped a little, following the correction in the price curve of the ICE Europe. In Colatina, indications for type 7 at around BRL 395 to 400 a bag.