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US Coffee C Futures - Jul 24 (KCN4)

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US Coffee C Futures Discussions

By Climatempo fresh and cold air :) will attempt to enter some coffee areas in MG in the end of the week. No reports today...
Some estimates as of spring for Brazil: 1) Stone X - 67mb; 2) Rabobank - 69.8mb; 3) Volcafe - 68.5mb; 4) Conab - 59mb :); 5) Itau BBA - 69.4mb; 6) Comexim - 67.2mb; 7) Safras - 70.5mb; 8)Hedgepoint - 67.5mb, was revised from original of 2023 being 74mb :); 8) NKG, ECOM, OLAM - I was able to find :); 9) USDA - ???.
Hedgepoint has reduced his estimate for roughly 6mb (it's the same as to eliminate Honduras:) or A production in SP :)), firm assists with hedging, etc. Highest view was of Rabobank, but even that one is of 70mb - not 72, not 74, not 76, 78, etc... And they all are in agreement :) - a bit below 70mb. :) For a reason ?
Sorry, highest was of Safras :), not Rabobank :) !*****
One more fun point: A in blends (if ratio is correct:)) provides taste and so, ability to drink regular drink, supported by love :) of the consumers. But this is if quality is above some certain level. Quality issues that have been admitted by some producers are: 1) more beans to fill the bag (size (weight), density(weight)); 2) future taste of processed and roasted bean. The question: what has to be the price for those beans with a weird :) taste to be competitive with R, and if the taste is not good enough to provide desired taste of the blend, will these beans be used for regular blends ? Question is not irrelevant, as if somehow it will not be used for the blends and should be sold for the price of R or below (just example), then A surplus (if any:)) may get meaningless :). Of course, all depends on final quantity, etc. But as Brazil is dealing with it for the first time in 300 years or so (w-guys insist:)), the result may come out being absolutely unexpected. Or let's say, at least such an outcome can't be ruled out until the dust will settle completely. I'm not agitating and not trying to mislead anybody - stay short, long, out, more importantly - stay safe and sound ! I post this hoping, that someone will share some valuable info or his view, etc...
ES, Arabica: on May 27th Arabica harvest in ES was officially open. During the opening ceremony, Incaper's Coffee Farming Coordinator, Fabiano Tristão, gave a talk, etc. According to INCAPER, Espírito Santo is expected to produce around 4.2 million bags of coffee in 2024.
I post just small parts, article is at revistacafecultura website, date 28,05.2024. ...there will be less carbon and less water available for the formation of beans during granation, which can lead to a decrease in coffee productivity even with water in the soil. ...... The persistent heat in May continues to wreak havoc. High temperatures accelerate the ripening process due to increased ethylene production, creating a smaller window for harvesting. This way, when the coffee grower plans to harvest a certain percentage of cherries, he calculates the time needed to harvest his crop and adjusts his logistics. If maturation occurs too quickly, the schedule is compromised, the fruits pass when they do not fall, increasing the amount of coffee on the ground, causing mold on the plant. In addition to the reduction in the harvest period, coffee growers face another serious problem that affects their planning and the quality of the coffee: uneven maturation.
Profs admit the problem and explain reasonable and possible outcomes.
Did the professors, respected and reputable professionals, joined the conspiracy ? :) And the say nothing about lost crop, devastation :), etc :). Just admit the problem is real and it has scientific explanation.
watching and enjoying
Sam “the bear” Houston goes long?!
Hey Sam what do you know
Rodrigo, this is how it sounds: The European Deforestation Regulation, or EUDR, will outlaw sales of products such as coffee beginning December 30, 2024, if companies can't prove they are not linked with deforestation. The new rules' scope is wide: They will apply to cocoa, coffee, soy, palm oil, wood, rubber and cattle. (Mar 30, 2024)
To sell those products in Europe, big companies will have to show they come from land where forests haven't been cut since 2020. Smaller companies have until July 2025 to do so. It's not fail-safe. Companies can just sell products that don't meet the new requirements elsewhere, without reducing deforestation. Thousands of small farmers unable to provide the potentially expensive data could be left out. Much depends on how countries and companies react to the new laws, Bellfield said. Countries must help smaller farmers by building national systems that ensure their exports are traceable. Otherwise, companies may just buy from very large farms that can prove they have complied. Already, orders for Ethiopian-grown coffee have fallen. And Peru lacks the capacity to provide information needed for coffee and cocoa grown in the Peruvian Amazon.
Exact implementation in relation to specific jurisdiction/area may vary... Most likely, the reality will be understood when it will get started. But Brazil should be good: :) Brazil, the world's largest coffee producer, is better placed, since its coffee grows on plantations that are far away from forests and it has a relatively well-organized supply chain. Also, Brazilian-grown coffee is most likely to meet the EUDR requirements, according to a 2024 Brazilian study, because much of it is exported to the EU, Brazil has fewer small farmers, and about a third of its coffee-growing acreage already has some kind of sustainability certification. :):):) Also, it seems it's gonna be a transition period from 2024 to 2028, a specially for small growers and small origins - a softer way to adjust ... Brazil is few steps ahead :) :) :) (as some researchers started saying about sense to create high temps resistant cultivars about 20 years ago).
Kenan, the fact that Brazil is advanced when it comes to coffee (and some other products) should not surprise you: 1) it is important part of the economy; 2) Brazil is a powerhouse with 220mil people (335mil USA) and a lot of arable land (huge potential), top 5 producer of roughly 35 commodities; 3) Brazil produces tons of researches, related to important industries and invests a lot of money into tech, to have higher yield, etc. That explains Brazilian success in coffee growing - it is a real industry.
Coffee market is a shame.. manipulation of the information and it does not meet any technical parameter
Stop reading those funny lines, they don’t mean anything.
that's like a tornado for me, 5 digits profit ......
Today Arabica PA is much stronger than R. It is beginning to become clear that the A harvest is worse than predicted?
First we've had Marco Antonio Jacob - he was telling us terrible news about coffee production...but again there was carryover- a lot of it. Then came Maya Wallengren ... same thing - even more carryover. Now we have got Viriato... Viri is writting big novels about end days for coffee - next we'll see a huge carryover. I can only say one thing : kudos to the speculators .
not because heat in mexico, but the weather in Vietnam which is the second large producer in tge world behind Brasil, so if you have a break(big) in one if this two countries…….
its why we produce same as all African countries together?
the bulls are bullishing not me
Another cup and handle?
so you mean the trend is to go long ?
Keep calm and buy the dips ;)
Guys I just wanna ask you when we will most probably know what is the real situation in Brazil ?
Tape didn't say those temps were recorded at the farms, so nobody knows... But 48C air temp may mean 53 - 60C On Leaf temp, depending on other factors as drought, if it's shade grown, health of the tree, etc... (Study I referred to couple of days ago, concluded that 90 min of 49C air temp - no flowers, no fruits assuming good soil level of moisture.)
Man, do you have a life other than this
Kudos Viriato, this is real commodity trading, supported by good knowledge about fundamentals.
Wheat has reached its highest level in more than nine months. The reason is supply concerns, which have been exacerbated by dry weather in major producers and the ongoing war in Ukraine. Analysts in recent weeks have lowered production estimates for Russia's largest exporter, while Ukraine is having its driest May on record. Nervousness is also heightened by historically low rainfall in Western Australia. The U.S. Department of Agriculture forecasts that global wheat stocks could fall to their lowest level in nine years in the coming season. Hedge funds, in turn, are reducing net bearish bets on the U.S. market.
When will it open?
It's official, the coffee trade has been halted due to a shortage of beans! From now on, only Brazilian and Vietnamese government agencies will grant individual licenses to export coffee abroad at predetermined prices!
LOL - Good one!
Couldn't resist :) : Coffee is the second most consumed drink in Brazil (Globo Rural). :) :) :)
The beginning of the year until today was still hotter and drier, so according to the analysis you presented, yields could not recover and rather recorded further declines.
I strongly believe that main surprises are ahead :). Besides smaller/lighter beans and quality issues, there are comments about flowering that has started at some farms (areas) or will start as soon as first rain will arrive. In May.
Would be just one example (some farmers complain about higher index): for every 1.8 degrees F increase in temperature, the coffee berry borer became 8.5 percent more infectious on average. Not only did the female beetles lay more eggs at higher temperatures, but they also drilled deeper into coffee berries, causing more physical damage. A follow up study, published this year in the Journal of Economic Entomology (2010 or so), found that higher temperatures also caused the female beetles to travel from berry to berry earlier. As soon as bug is inside the bean, it is practically not combatable :). Now, consider again, that Brazil is one story and many other origins - another, preventive, etc treatments wise...
General effect of high temps/heat stress on the plants:
The are different cultivars (clones) with different levels of resistance and not all farms suffered and not same high temps, etc. But as coffee tree is not ... Cactus (as of yet), the reaction to the stress would be as described above. The only question is the percentage and extent....
The agronomist from MDS in one of the videos, related to temps effect, also referred to a spider caterpillar, attacking coffee farms in ES - it was common/regularly observed before. Guys from Procafe confirmed the cases in MG also, after observing several crops to identify what caused the damage (many caterpillars like coffee :)). Why this fact worth a bit of attention ? By science, imbalance in the tree functioning or weakness often provokes the attack of higher scale or the attack of the pests, that not commonly do it otherwise. Lagarta aranha (spider caterpillar) is not a specific coffee pest, at list it was not common in a past for the mentioned areas... Could be another confirmation of heat stress...
1) High temperatures can directly induce heat stress in plants, regardless of soil moisture levels. Heat stress disrupts cellular processes, including photosynthesis, respiration, and protein stability, leading to cellular damage and impaired growth. Even if soil moisture is adequate, high temperatures can still cause excessive transpiration and water loss from plant tissues, leading to dehydration and wilting; 2) Very high temperatures can inhibit photosynthesis by disrupting the function of photosynthetic enzymes and proteins, even when soil moisture is sufficient. Heat stress-induced damage to chloroplasts and thylakoid membranes reduces carbon assimilation rates and limits carbohydrate production. Reduced photosynthetic activity impairs growth and development, even if water availability is not a limiting factor; 3) High temperatures can disrupt hormonal regulation in plants, affecting growth and development processes such as cell division, elongation, and differentiation. Heat stress-induced changes in hormone synthesis and signaling pathways can occur independently of soil moisture status. Altered hormonal regulation can lead to morphological abnormalities and physiological responses, such as leaf senescence, premature flowering, and reduced biomass accumulation;
Please, don't write just 100,!200, 300, 500 ....
Very informative and illustrative podcast of procafe #129. Alysson confirms the problem of smaller beans, lighter beans (lower density) and quality issues and gives his view on the causes and how it was related to recent weather issues. He doesn't see a catastrophe but suggests producers to pay close attention, etc. (Speaking of A in MG.) He admits that duration of high temperatures doesn't support normal functioning of arabica tree. :) (Normal temps he considers 21 - 23C.) And also, I would not miss the comments that producers, that already watched the podcast made :). This podcast was promised to the viewers but in my view came out rather faster than it would in other circumstances (very personal opinion !) what may indicate that Alysson is 100% sure the problem is worth of attention and no additional information is needed to make a conclusion. The viewers of Procafe are mainly producers as consulting/educating producers is procafe main business. So, the comments, are made by real people (producers) and reflect their current reality.
So, it wouldn't be very risky :) to conclude that many other origins that suffered similar temps (or still do) will face similar problems and most likely to bigger degree as their trees are/were not managed in the same way as in Brazil and so, their health :) and so ability to resist/survive was/is of lower level besides in some cases the situation was more severe as drought was/is ongoing at the same time. (Drought, besides mostly being a negative factor itself, when combined with high temps amplifies the effect as it causes higher On Leaf temperature (tree has less energy:) ) to adjust/resist) Thus, their reduction may be way bigger (percentage wise) vs Brazil. Well, and the admittance of the problem in relation to high temps questions for some areas next season 2025 yield.
Besides the fact that taste of some beans will be compromised, Alysson stated that more beans to fill the bag will be the issue for affected areas.
Data wise, it should be no doubt that heat waves in terms of their duration and extent of the temps were/are unprecedented. But as all has its end, heat waves end may be also almost in hands - top may be in the making or near. So, cooling :) is the thing that has to be closely watched next and a specially, in relation to La Nina, as soon as first real cooling signs will reveal themselves :).
300.21
321.00
Short Dude. The whole situation in the comments area :) :) :) re possible drop, if to define simply, should be called a confusion. A lot of people form the industry make comments on possible drop, but almost nobody is sure if it will take place and if it will - to what degree... :) Funny or not, but there is a perfect explanation for it :) and it is very simple: lack of previous experience. When the one never dealt with a specific factor how can he come with more or less reasonable evaluation ? Many w-guys stated that all those high temps/heat waves were/still are absolutely unprecedented, one of a kind in 300 years or so, what brings us to 1724, very close to the end of last GSM cycle (Maunder, 1645 - 1715). Who remembers what A/R were doing back then as coffee was introduced to Brazil around 1727 :). Thus, what industry knew till yesterday was the fact, that trees were able to survive previous high temps (we're not speaking of drought now) with a very minor or not visible (important for evaluation) effect. As it is a scientific fact, that On Leaf temp can be air temp +12C / +20C for FULL SUN GROWN method and in its previous 300 years Brazil NEVER DEALT with anything close to what was going on in 23/24, realistic figures can't be made by agronomists, farmers or coop presidents, etc. Many farmers and agronomists by intuition feel that's it's going wrong from the beginning but reasonably want to wait for a next stage of the harvest before new comments, etc. Loaded trees look good, smaller green beans at the start are regular, etc, why talk disasters :) ??? The one who would be able to make professional comments is the researcher of the matter (and multiple studies have been conducted over the years), but those people are different layer and are deeply in their own business :).
If to consider explanation above being reasonable :), it brings to a next point: if damage was real (MG wise), it will stop being a secret as soon as 1/2 of harvest will be completed and at 2/3 of harvest the scale will be understood. If to assume MG harvest from May 1st to August 31st, the end of June will send real signals :). As of mid May, Cepea commented that in general producers have reported lower productivity for A (early harvest, up to 10%, depends on the area) and lower quality for ES and RO. Thus, as soon as time will come, Cepea will tell the truth ! :)
Viriato, thank you for giving me a time how much longer to wait for my Lambo ;) It comes out that coffee is the most complicated plant in the world, it also comes out that agencies prefer to inflate initial estimates and possibly adjust them downward later, rather than the other way around. Which is perfectly understandable. We now need some patience to see who was right.
You're right, this is what makes coffee good also for speculations. It is a very delicate and complex product :) ! As MGom said once and forever: KC always has life of its own ! (It seems though, R is joining KC :)). But no matter what - Stop Loss is the King !!! :)
As per consumption in East Asia: Luckin Coffee (LKNCY) already has more than 18k Shops! How many stores Starbucks globally has?
During covid US dealers refused to take Porsches intended for US market. China said it will take Porsches but in exchange wanted more understanding in the future in terms of more supply for China on regular basis. Cars went to China, pattern was changed... Probably, not forever :), but still :)...
Starbucks does not sell coffee but flavored syrups and milk :) So, it's not about the coffee they sell, but rather about fashion and the education of a new coffee market.
100% agree! It's abt. harvesting the Apples @ShortSqueezeDude;)
On Wednesday, coffee trader Volcafe said Vietnam's 2024/25 robusta coffee crop may only be 24 million bags, the lowest in 13 years, as poor rainfall in Vietnam has caused "irreversible damage" to coffee blossoms. Volcafe also projects a global robusta deficit of 4.6 million bags in 2024/25, a smaller deficit than the 9-million-bag deficit seen in 2023/24 but the fourth consecutive year of robusta bean deficits. My question is, who will fill the void left by Vietnam, which is the largest producer of Robusta? Brazil again?
Now ES is like MG: can't disappoint !!! :)
The president of Cooxupé added that the cooperative maintains the expectation of a 7.7% increase in coffee receipts in 2024 compared to 2023, to 7 million bags of 60 kg – the cooperative members should account for most of the volumes, with an expectation of 5 .6 million bags in 2024, while the remainder will come from non-cooperative producers.
For 2024, Brazil's Arabica coffee harvest is beginning. And, as in the case of canephoras (robusta and conilon), the market has reported smaller grains at the beginning of work, with hot and dry weather being cited as the cause. But, according to seminar participants, it is still a little early to say whether this trend of “small sieves” will be confirmed throughout the entire harvest. (At least, problem is admitted. :))
Guys, I apologize hugely for misleading :) !!! SORRY !!! I messed up with Arabica numbers from Conab report :): Conab has shown 42.1mb in this report vs 40.75mb in Jan !!! Thus, Conab sees increase in A production vs Jan estimate for roughly 1.35mb, what total crop figure wise, covers projected decrease in R for roughly 600kb and leaves roughly 750kb of surplus.
Minasul: For Guilherme Rezende, commercial director of Minasul, a cooperative also located in the south of Minas Gerais, there was initially an expectation of an increase of up to 15% in coffee receipts in 2024. "But now we have to see if the yield will be affected or not", he said . "The sieves are very low, this could affect the yield, we will have to wait for us to know the size of the crop failure, to know if it will be a trend", he stated, agreeing that the situation will become clearer with the development of harvest.
More Cooxupe: According to Cooxupé's commercial superintendent, Luiz Fernando dos Reis, the cooperative has already verified in some batches received from the new harvest that the grains "really are presenting a sieve problem". "They are smaller compared to last year, when we had a good sieve year", he stated, noting that it is prudent to wait before making any estimates, as the harvest is just beginning. "I think we have to wait a little, move a little further... Apparently we will have a lower sieve percentage than the average of recent years... To be able to project some better numbers, and whether this will have any impact on the final production, we have to wait."
You don't need to apologize. We've known this since the beginning...you may continue...
Record heat continues in Asia, Oceania, SA ...
CA, Mexico :).
In 1st estimate of Jan 2024 Conab projected conilon in ES to be 11.1mb. In today's report it is 10.8mb. 300kb lower or roughly 3% lower. Thus, CONAB admitted the problem. Yes, 3% is not 10% but it would be naive to expect it in second estimate. Important fact is, that the issues was noted and so, anybody may think for himself now, what the final correction is gonna be (if at all :)).
Nothing new of what you're not already aware of :). Open sources narration continues in a way that smaller/ lighter / defective beans problem as the result of uneven maturation, etc (high temps. dry spells) exists in whole MG. There are comments in popular coffee media with the pics, etc. Unlikely a conspiracy :) and would imply some adjustment on later basis. It is important, that after one of a kind recent drought, part of the issues were smaller beans, what resulted in more beans to fill the bag. :)
Yes, I saw a video on Cafeicultura's profile on IG, on one branch the fruit in different condition. How to harvest it?
Need to be separated and graded. Wet proces seems easy - naturals might be a bit more challenging :)
bear trap closing green
I don't think it's closing green
...
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