Update-July Report

May 28, 2015

Good Afternoon

Last Thursday I said that the coffee market had corrected rather dramatically downward.  Since then after three days of trading, May is down another 400 points.  May closed today at 124.50, down only 45 points for the day with a trading range of 300 points.  Technicians call today’s candlestick a spinning top because of the long tails up and down with a very limited change from yesterday.

Two weeks ago the dollar had weakened which may have cause the May contract to go up over 142.50.  Now the dollar is strengthening which may be one reason May is showing weakness.

Although May has come down a lot, as long as the dollar continues to strengthen against the Brazilian Real, I think that the market has limited upside movement unless of course the weather forecast for Brazil is for temperatures to be single digit Celsius

July Report

May 21, 2015

Good Afternoon

Three days ago when July closed at 143.15 I said that since July had climbed 1300 points it was probably time for a correction.  Boy, have we had a correction.

With July down 755 points today and a close below 1.30 at 128.45 we have had a very definite correction.  A close well below the previous support level of 1.30 suggests that we could go lower.  On the other hand do I dare to suggest a correction upward tomorrow.  In the past two months since the big drop from the 1.65 area to the 1.35 area July has seen some very big reversals.

I am attaching two articles – one that makes some general comments and states that demand still is expected to exceed supply and the second suggests that we could easily go to 1.20.

Click Here for Articles

Today’s Yield from the Coffee Field—Weather patterns determine the areas ready to flower

September 25, 2014

CEO of Excelso Coffee, Ed Field, reveals all the factors that go into each perfect cup of Field Coffee and Tea.

At 7:50 a.m., December dropped 300 points in three minutes and in less than one-half hour it was down more than 800 points. A weather report probably initiated the fall. The rain came and the market turned downward quickly. Will the rain continue????

A report by World Weather to learn which Brazil crop areas are too dry and which will ones are likely to flower. “A near-daily scattering of showers and thunderstorms will occur in these more important coffee areas (northeastern Sao Paulo to Sul de Minas and Rio de Janeiro) during the weekend and through most of next week.”

Read the Sept. 25, 2014 Brazil Coffee Weather report, “Greater Rain In Sao Paulo Today.”

Today’s Yield from the Coffee Field—Dry Brazil weather stays dry, creates favorable conditions for harvest

September 24, 2014

CEO of Excelso Coffee, Ed Field, reveals all the factors that go into each perfect cup of Field Coffee and Tea.

With the Brazilian weather staying dry, which is good for the harvest, the bulls seem to be exerting their muscle. Yesterday, the December coffee contract closed up 150 points, but was nearly 400 points higher at midday. Today the market started fairly flat. But around 9:45 a.m., strong buying came to the market, which rose about 800 points in less than 15 minutes to a high of 189.90 points. The market closed up 820 points at $1.8910.

A Sept. 24, 2014 report by Meteorlogix, which predicts “mostly favorable conditions for harvest during the next five days. More rain will be needed during the coming months to support flowering of the new crop.” Although this weather report indicates dry weather for the next five days, rain early next week, if in great quantities, could make the market turn around. If the weather continues to be dry, we will see much higher prices.

Read the Sept. 24, 2014 article, “SAO PAULO AND MINAS GERAIS.”

Today’s Yield from the Coffee Field—Bull and bear behavior move market up and down

September 19, 2014

CEO of Excelso Coffee, Ed Field, reveals all the factors that go into each perfect cup of Field Coffee and Tea.

Yesterday, December closed down 320 points at $1.78 even. To the best of my knowledge, there was no breaking news. But from 8:30 to 9 a.m., December dropped 450 points to 1.78 (about 3,000 lots traded). It then continued down to the low for the day of 176.40. This move downward was a breakthrough of the support level at 1.81. The next support level is 1.75.

However, with no more negative (bullish) news, we could see the market quickly drop below 1.60. Monday could be a small up day or a dramatic down day, depending on where the bears looking. Now I feel I am out on a limb and the saw is between me and the tree. Not good! We will see what happens.

Today’s Yield from the Coffee Field—A week of narrow trading and “absurd” claims about the crop

September 18, 2014

CEO of Excelso Coffee, Ed Field, reveals all the factors that go into each perfect cup of Field Coffee and Tea.

Today, December closed just off the low for the day at 181.20, down 365 points. During the last seven days we have traded in a rather narrow range, relatively speaking, of about 550 from 181 to 186.50. But a more interesting fact is that in five out of those seven days, December met heavy resistance in the low 181s. A break out below 180 could suggest a big push south.

Once again, in order to show you how fickle the market is, I am attaching an article which indicates how different Brazilian organizations feel about the current production forecast. A report by Market Talk on industry groups slamming reports about the outlook of the coffee crop as “absurd, incoherent and reckless.”

Read the Sept. 17, 2014 article, “DJ Brazil Coffee-Crop Outlook Slammed By Industry Group.”

Today’s Yield from the Coffee Field—December ends at a high for the day

September 17, 2014

CEO of Excelso Coffee, Ed Field, reveals all the factors that go into each perfect cup of Field Coffee and Tea.

Today we had one of the smallest trading ranges of the past several months. December closed down 0.40, with a trading range of only 335 points. For most of the day, the market tried to break through 183.50, but met some solid resistance. It was not until the last 15 minutes that December zoomed to the high of the day of 186.45 at 1:29 p.m. The settlement was 184.5, 195 points off the high. So not too much happened today in the coffee market.

Read the Sept. 11, 2014 Thomson Reuters article, “Brazil sees 2015 coffee crop of 48.83 million bags.”

Today’s Yield from the Coffee Field—Predictions about low yield skyrocket prices

September 16, 2014

CEO of Excelso Coffee, Ed Field, reveals all the factors that go into each perfect cup of Field Coffee and Tea.

Today the December coffee contract opened down and tried to break through $1.81, where it had found support in three out of the past four days. At about 9:30 a.m., about three quarters of an hour before the attached article was released, the market moved quickly upwards. It climbed 690 points in 75 minutes, up to 187.95, probably hitting several buy stops on the way up. (Dare we say insider information.) Then traders started to digest the report and determined maybe the situation is not as bad as anticipated. December closed up 305 points at 185.25. Maybe tomorrow we will try to break through 1.81 again.

This Sept. 16, 2014 report released on the Dow Jones Newswire about the gain by arabica-coffee futures after predictions about the low yield in Brazil. “Brazil’s worst drought in decades raised worries about the size and quality of production this year, sending prices to a more than two-year high.”

Read the “DJ Arabica-Coffee Future Gain After Brazilian Forecast” article from the Dow Jones Newswire.

Today’s Yield from the Coffee Field—A strong dollar and low prices creates fluctuates the market

September 11, 2014

CEO of Excelso Coffee, Ed Field, reveals all the factors that go into each perfect cup of Field Coffee and Tea.

Today was a day of correction after yesterday’s big fall.  December closed up 420 points at $1.8540. In many past days, we may have thought of 420 points as big move. Today it is only 61 percent of the average daily trading range. Yesterday I mentioned the strong dollar and weak Brazilian real and the Colombian peso. A strong dollar and/or a weak currency from a coffee growing country can influence the market. In the past, we have seen some support in the $1.85 range. Maybe the strong dollar will help to push the market lower.

Read the Sept. 11, 2014 article published on the Dow Jones Newswire revealing, “Coffee prices rose as some bearish traders returned to the market as buyers to lock in gains after prices hit a one-month low a day earlier…Still, prices are likely to resume their declines amid pressure from a stronger dollar.”

Read the “DJ Cotton Nears 2-Month High on Lower Production Forecast” published Sept. 11, 2014 on the Dow Jones Newswire.

Today’s Yield from the Coffee Field—What is driving the market down?

September 10, 2014

CEO of Excelso Coffee, Ed Field, reveals all the factors that go into each perfect cup of Field Coffee and Tea.

Today was a bit exciting. (Allow me a little humor.) December closed down 11.35 points at $1.8125. It looks like December traded a few hundred lots in each five-minute period throughout the day, but from 1:20 p.m. to 1:25 p.m., five minutes before the close, December traded 2,146 lots, which sent December down 280 points and set a low for the day.

I am sure the December hit several sell stops in that slide. So, what is driving the market down? Clearly, some of the push down is from people who think the coffee supply this year and next year will be satisfactory to meet the needs of the market place. But also the strength of the dollar in relation to the Brazilian Real and the Colombian Peso affect the coffee market, because the coffee is traded in dollars. After the big drop today and the slide this month, we could see a correction tomorrow.