ICO report shows continued decline in April

The April 2018 Coffee Market Report from the International Coffee Organization (ICO) shows a continued decline. The ICO composite indicator decreased by 0.4 per cent to an average of 112.56 US cents per pound, setting another low from the March average of 112.99 US cents per pound. The daily price ranged between 110.49 US cents and 114.73 US cents per pound, with prices for all three Arabica groups falling during the month. However, the monthly average for Robusta increased by 0.1 per cent to 88.31 US cents per pound. Global coffee exports amounted to 10.81 million bags in March 2018, compared with 10.91 million bags in March 2017. Exports in the first six months of coffee year 2017/18 decreased by 0.6 per cent to 59.96 million bags compared to the same period in the previous coffee year. The largest decline occurred in the average price for Brazilian Naturals, which fell by 0.9 per cent to 118.76 US cents per pound, while Other Milds decreased by 0.5 per cent to 134.34 US cents per pound. Colombian Milds fell by just 0.1 per cent to 139.29 US cents per pound, with further downward movement limited by expectations for a smaller Colombian harvest in 2017/18. As a result, the differential between Colombia Milds and Other Milds increased by 12 per cent to an average of 4.95 US cents per pound. The monthly average Robusta price rose by just 0.1 per cent to 88.31 US cents per pound, reflecting the short-term tight supply situation just before the arrival of the new Brazilian Robusta crop. The average arbitrage in April, as measured on the New York and London futures markets, fell by 2.4 per cent to 40.81 US cents per pound. Additionally, intra-day volatility of the ICO composite indicator price decreased by 0.3 percentage points to 4.0 per cent.