After a slight increase in the first month of 2018, in February international prices fell by 1%, due to the negative behavior of three groups of the Arabica variety.
Wednesday, March 21, 2018
From the monthly report by the International Coffee Organization:
After a slight rise in January following a three-month decline, the monthly average of the ICO composite indicator fell by 1.2% in February 2018 to 114.19 US cents/lb. The daily composite indicator was generally higher in the first half of the month, peaking at 116.07 US cents/lb on 14 February. The composite indicator reached a low of 112.16 US cents/lb on 21 February, but remained above 113 cents/lb after this date.
The decline in the monthly composite indicator was driven by the negative performance of the three Arabica groups, all of which lost value compared to their January levels. More specifically, Colombian Milds fell by 1.6%, Other Milds by 1.8%, and Brazilian Naturals by 2.3%. Robustas, on the other hand, recorded moderate growth of 0.7% compared to January.
The differential between Colombia Milds and Other Milds increased from an average of 4.96 US cents/lb in January 2018 to an average of 5.22 US cents/lb in February. The average arbitrage in February, as measured on the New York and London futures markets, fell by 10.9% to 43.44 US cents/lb. Additionally, intra-day volatility of the ICO composite indicator price decreased by 0.5 percentage points to 5.2%.
Prices for all coffee groups fell in July 2018, though the largest month-on month decrease occurred for Brazilian Naturals, which declined by 4% to 110.54 US cents/lb.
From the monthly report by the ICO:
In July 2018, the ICO composite indicator price decreased by 2.9% to an average of 107.20 US cents/lb, which is the lowest monthly average for July since 2007, when the monthly composite indicator reached 106.20 US cents/lb.
The climate in Brazil was the main factor affecting the behavior of the international price of the grain in January, starting the month high and closing at $143.43 per pound.
From the Coffee Market Report - January 2015 by the International Coffee Organization (ICO):
Dry weather in Brazil at the beginning of January spurred prices higher, with the daily price of the ICO composite indicator rising from 140.57 US cents/lb to a high of 155.40 by the middle of the month. However, forecasts of rain later in the month punctured this brief rally,causing the ICO composite to fall back down to 143.43 cents by the end of January.Nevertheless, overall rainfall levels in Brazil remain below average, with the development of the 2015/16 crop now at a crucial stage. Furthermore, an infestation of coffee berry borer has led to a state of phytosanitary emergency being declared in the states of São Paulo and Espírito Santo.
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