In Summary
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The main driver of NY has been a macro-driven sell-off with index funds exiting their entrenched long position across most commodities assets. Against this backdrop, NY certs draws resume and is now below the 700k bags mark, which is a bullish signal. Coffee demand is looking strong as Nestle, JDE, Starbucks and other biggest roasters all reporting increased sales.
There are divergent thinking about Brazil production, both the current and the next crop. According to traders, the current crop 22/23 should be between 36 and 43 million bags. Many coffee players start forecasting a bumper crop for 23/24.
However, it seems that Brazilian local traders are less optimistic. Figures seem to be in the range 40 – 50 million bags for Arabica and around 20-23 million bags for Conilon. The risk of frost in Brazil this winter is apparently very low.
