Commodities KC Arabica Coffee C (2 lettori)

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intanto scienziati brasiliani sono molto avanti nello studio del genoma del caffè , l'obbiettivo è di migliorare consistentemente sia la resistenza della pianta che la qualità del prodotto finale

ODJ Brazilian Scientist Ends First Stage Of GM Coffee Quest

By Alastair Stewart
Sao Paulo, Dec. 10 (OsterDowJones) - Super gene-modified coffee trees will
come a step closer in December when Brazilian scientists finish mapping the
coffee genome.
Over the last 10 months, research teams have identified approximately
200,000 genetic sequences in coffee trees, information which will be the basis
for research into creating more resistant trees that produce higher-quality
coffees, a scientist leading the project told OsterDowJones.
"We now want to find out more about what the genes do," said Carlos
Colombo, chief researcher on the project at the Campinas Agronomic Institute,
or IAC, in Sao Paulo state.
Colombo said the next phase of the project, starting in the new year, will
be to identify key gene sequences and discover their properties.
From this information, scientists aim to modify trees as a way of
increasing the quality of arabica coffee produced at a lower cost.
"We have been told not to focus on increasing yields but adding value to
produce," said Colombo.
Researchers, for example, will look at ways of reducing the arabica coffee
blossoming period to cut time spent picking coffee. This would not only cut
harvesting costs, which account for around 40% of total outlays, but also
increase the likelihood cherries are taken off the trees at exactly the right
time, said the researcher.
"At the moment, very little is known about how the blossoming works," said
Colombo.
Scientists will also look at which genes increase resistance to drought, a
major problem, as well as pest and fungi.
Gene-modified technology offers the potential to reduce herbicide and
pesticide costs by 50% to 100%, according to Agriculture Ministry's research
arm.
But don't expect gene-modified trees to start populating Minas Gerais
hillsides too soon. Colombo estimates it will take five to 10 years to
identify the relevant sequences start creating modified trees.
Meanwhile, funds still have to be raised to sustain the research groups,
which involved 20 laboratories in Sao Paulo state alone, through the next
stage. Around 200,000 Brazilian real ($1 = BRL3.80) are in the coffers but the
first phase alone ate up around BRL2 million in government and state funds.
All 200,000 gene sequences will be stored at the Sao Paulo State
University of Campinas, or Unicamp, one of the country's leading centers of
agricultural research, and the University of Sao Paulo, or USP.
This is by far the most advanced study into coffee genes.
"The hope is that this research allows Brazil to stay ahead of the
competition," said Colombo.
Brazil is the world's No. 1 coffee producer and exporter, accounting for
around 40% of world production, according to U.S. Department of Agriculture
data.
In 2003-04 (July-June), Brazilian coffee production is expected to slip to
around 25 million to 35 million 60-kg bags from 45 million to 52 million bags
this year.
Brazilian researchers have already genetically mapped sugarcane and are in
the process of studying the genes of witches' broom fungus, which has
devastated Brazil's cocoa production in recent years.

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Giornata pesante ieri per il caffè che ha preso i minimi degli ultimi due mesi , con i fondi costretti a smantellare parte della loro massiccia posizione long e l'industria che ha comprato un pò sui 62cents ma poi non ha più sostenuto i corsi verso la fine delle contrattazioni.

ODJ CSCE Coffee Review: Sinks To 2-Mo Low In Fund-Led Rout
-- Funds Trim Heavy Long Position
-- Central American Harvests Exert Pressure
-- Brazil To Release New-Crop Estimate Next Tuesday Or Wednesday

By Susan Buchanan
New York, Dec. 11 (OsterDowJones) - Arabica coffee futures tumbled to two-
month lows on the Coffee, Sugar & Cocoa Exchange Wednesday as funds were heavy
sellers, while buying from roasters and industry curbed the retreat.
Mar settled 390 points lower at 61.75c a pound and May ended down 385
points at 64.20c.
"Funds liquidated another 5,000 to 7,000 lots today on top of some selling
in recent days," said Michael McDougall, senior vice president with Fimat
USA. "Funds were the longest since 1994 in the last commitments (of traders)
report."
Mar broke the Oct. 30 low of 64.35c in early action, hitting sell stops,
he said. "Industry buying defended it" at 61.90c for a while, but the market
broke down again before the close.
Futures volume was 25,912 lots. In the options ring, 9,761 calls and 4,820
puts traded. Some 270 against actuals were posted, mostly in Mar.
U.S. and European roasters were good buyers on the way down, traders
observed.
"The market expects a cyclical downturn in Brazil's production this
season, but weather has improved with recent rainfall," McDougall said. Trees
were stressed from bearing the last big crop and from dry weather in
October "though not permanently damaged," he added.
Brazil's next harvest should be on the small side, but the crop after that
could be a big one, McDougall said.
Central American harvests are progressing at this juncture, exerting
downward pressure on the market, he noted.
Brazilian officials plan to release their first forecast of the nation's
new crop based on field surveys next Tuesday or Wednesday. The last harvest
was a massive 51.6 million bags, according to a USDA report released last week.
The success of spring blooming in Brazil in October and early November was
mixed across growing areas, depending on the amount of rain received, traders
said.
Scattered showers are expected daily in Minas Gerais and Sao Paulo,
Brazil, through this week and into next week, according to Global Weather
Services. The upper part of Minas was hot and dry recently and needs moisture.
The Brazilian government sold all 20,000 bags offered to local industry
Wednesday in the final auction of 2002.
Brazilian officials plan to cut allocations for the coffee fund, Funcafe,
in 2003. Demand for financing should fall with expected lower coffee output.
Thursday's CSCE action will decide to which strike the nearby futures
gravitate before the Jan options expire Friday, said Al Abaroa, senior trader
with Time Leverage Capital in Florida.
Chart support for CSCE Mar lies at 61.40c, 61.00c, and a gap at 60.90c to
60.60c, traders said.

Settlement prices in cents/pound, dollars/metric ton
CSCE Change Range Liffe Change
Mar 61.75 dn 3.90 61.40-65.00 Jan 759 dn 29
May 64.20 dn 3.85 64.00-67.40 Mar 777 dn 30

Stessa storia al Liffe e al BM&F di SanPaolo

London coffee falls four percent on fund liquidation
LONDON (December 12 2002) : London coffee futures fell more than four percent on Wednesday in a market pressured by fund liquidation with some trade and roaster support at the bottom of the range, dealers said.

Trade on the spreads weakened the market in the morning in low volumes, setting the scene for aggressive fund and speculative liquidation which kicked in during the afternoon.

The benchmark January hit a low in the session of $755 a tonne, basis January, a drop of $33 from the previous settlement and a level last seen on November 14.

Then it partially recovered to close $29 down at $759 on 6,298 lots.

Technical analysts had said early on Wednesday the market was looking for a base around $766.

Second-month March dropped $30 to end at $777 on 6,005 lots.

The January/March switch widened to a $22 discount, from a around a $18 discount in the early trade.

"It has mainly been fund liquidation, with funds selling aggressively when we broke under key levels. We hit several stops and the market slid through," one trader said.

"The funds were very, very long, at level very difficult to sustain technically," the trader added.

Consolidation moves during the last days had sent a warning sign to the funds and other long positions in the market and dealers said the market could still move lower, especially if heavier origin selling hit prices in the next weeks.

The next Vietnamese crop, delayed due to dry weather, is expected to reach the market in the short term, with about half of the harvest already done.

"There has also been some trade buying at the lower levels and some roaster support.

Otherwise, we could have dropped lower," one trader said.

In other news, the Brazilian government said on Wednesday its much-awaited first forecast of the 2003-04 coffee crop is likely to be issued on December 18.

Global coffee markets are eagerly awaiting this forecast, which is expected to yield a much lower number than the current bumper harvest.-Reuters

By Kieran Gartlan
Sao Paulo, Dec. 11 (OsterDowJones) - Arabica coffee futures at Sao Paulo's
Commodities & Futures Exchange slid to two-month lows Wednesday, following
sharp selling from funds and specs on New York's larger Coffee, Sugar & Cocoa
Exchange, traders said.
"There was a sharp sell-off today. A lot of specs were long so there was
quite a bit of stop-loss selling," said Alexandre Nahum, a trader at the Terra
Commodities trading house in Sao Paulo.
The market is in a downward spiral, he added, and could see further losses
over the coming days.
"We could see the Mar contract (in New York) dropping to 55 cents by the
end of the week," said Nahum.
The most-active CSCE Mar contract dropped 390 points Wednesday to 61.75
cents to the pound, while the May contract closed down 385 points to 64.20.
Meanwhile, the Brazilian government sold all of the 20,000 60-kilogram
bags of coffee on offer at an auction Wednesday. The auction raised revenue of
2.670 million reals ($1 = BRL3.79) on prices ranging from BRL130.10 to
BRL138.60 with all lots showing a premium on minimum prices.
The sale was the last in a series of monthly auctions for 2002. The
auctions are expected to be continued in 2003.
Trading volume Wednesday was well above average at around 3,700 lots,
compared to 1,200 contracts traded Tuesday.
The BM&F Mar contract finished 425 points lower at $61.05 per bag, while
the May 03 contract closed 420 points weaker at $64.00.

Settlement prices in dollars/60-kilogram bag
BM&F Change Range
Dec 02 57.00 dn 230 $57.00-$60.00
Mar 03 61.05 dn 425 $61.00-$65.00
Mar 03 64.00 dn 420 $64.00-$64.50

KCH03-11-12-2002-15min.png
 

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Phantom of the Pits
by Art Simpson

Chapter 3 - A Little History





--------------------------------------------------------------------------------


ALS - Let us get into a little of your background without breaking the rules here. How did you come upon the name of Phantom of the Pits?

POP - It all comes from the respect I have been given in the Pits. I started Pit trading in the early 70's after some early off floor introductions to commodity trading.

ALS - Why did you decide to trade on the floor instead of Up above (off floor with quote machine) as most traders?

POP - I really liked the challenge and excitement of floors trading. The appeal of being in complete control at all times seemed to be a dream of all traders. I certainly felt I could do well on the floor by being in total control. I had a few friends who advised me to buy a membership and get on the floor. It happened so fast.

ALS - We both know you are Phantom at showing up on the floor over the past several years. Can we get into some of your experiences on the floor?

POP - You know we all had so called offices on the floor in the Pits. Each day prior to the market open we would all go stand in our little 3 by 3 foot office. Every day there was this trader named Cindy who would make her office one tier in front of mine.

I remember her name as her career start was as a Math teacher. Her husband was a GM at the music FM radio station I always liked to tune to listen to easy music. I actually knew more about her than she ever knew.

Each day she would wait until she was sure where the market was headed and position. It happened that I was strong into taking profits on the 3rd wave of buying or selling. It apparently was her break out indicator. She would always take my offer below the last trade for selling and before she carded it would say "

I hate trading with you because I always lose when I take your trade." I never forgot that statement which she would make. Losing never stopped her from staying with her plan as she knew to lose small and go with her program.

I am sure she has made lots of funds over the years. I sort of felt bad when she would say what she said but it started me thinking about losing. Her mind was set correctly in trading. Funny how little incidents shape our belief in trading, some good and some bad.

ALS - She was never afraid to take your trade even though she felt she lost from it most of the time?

POP - She had convictions. A lot of the other traders would shut up and back off whenever I would make an offer. I was starting to pick up a reputation for being correct and the traders would start to follow me.

It actually would hurt my execution and that is where I discovered that EXECUTION is critical. If you can't EXECUTE in getting in, you sure can't execute to get out. It wasn't a mental thing but a hindrance in my trading plan.

ALS - So what did you do to overcome this execution problem.

POP - I started to play games with my trades. Actually the Funds do it now. It is so artificial but they fall for it. It worked like this. If I had a position and I wanted to take profits I would pretend I wanted to add to my positions. So I would Bid the market instead of Offer. I had enough follow me that they too would Bid the market. I would turn the Bid and instead hit the Bid and sell my positions.

ALS - Seems like a good strategy. Did it work most of the time for you?

POP - Well I felt bad about getting the other traders out of position by using this little game so I decided to just hit the Bids when I wanted to get out. If there weren't enough Bids at the last price I would let the market work itself down to a point I was out.

Today the funds must use fades because they must go at the market to position. This is a problem if they don't know the liquidity at the time. In the long run it won't make much difference as short term influence isn't as you would think. I also learned to not stake it all on one price. A long time friend taught me the range strategy. It works for me.

ALS - What did you usually trade at first?

POP - You know the only answer I am going to give you! Anything that moved! By that I mean movement has less risk. You wouldn't think so ordinarily but in a move you can have a smaller position and make a better return. In a dead market you tend to position too large and Wham a news story runs the market and you weren't prepared.

ALS - But don't moving markets chop you around more?

POP - There is integrity about the chop as trends, which develop, give you a good range to work with if you don't get emotional about it.

ALS - Maybe we should interrogate that statement in a later chapter. How did the other traders treat you when you first hit the pits?

POP - They would yell at me to take my profits and to step off of first base. I didn't mind their remarks except one. They would say "well it is only money" and that made me mad as I took it personal when I would throw money away. I started out with such a small amount of money and I couldn't stand to lose money at first.

I got even with the other traders for that remark. I would watch them and when their shirts would expand and their ties were too tight and finally their face would turn red I would yell at them "TAKE YOUR LOSSES!" It wasn't long before we had an understanding.

I actually was doing them a favor in telling them to take their losses. To this day I call this out to myself when the market isn't working my position correctly. The big start of my behavior modification I suppose.

ALS - How have your Pit friends and your recent friends treated you over your trade life?

POP - You know I have just really found out recently how loyal my friends can be. If you do something which they remember it is without fail that they will be loyal to you. They respect me more now than at first. That respect is not just out of trading but knowing that true friends look beyond your face into your heart and soul to find you. It is very touching.

ALS - You don't seem to floor trade much anymore. Is there a reason?

POP - You look on the floor and you see it is a young persons game out there. I am not saying that is the success now because it is more than youth in this business which makes you a successful trader. I trade upstairs because I understand the markets better at a distance and can trade more markets. Being on the floor is limiting as a trader.

A floor trader is more of a scalper than a position trader is. I like the latitude of being able to set up various criteria for different markets and not depend on my own execution in the pit to position.

ALS - Would you give other traders advise to start on the floor?

POP - I am asked for advice often but I don't like to ever give advise. I only like to give guidance, as all traders must make their own bed. They must make their own efforts to learn. It is their decision as to how they will make their plan on trading. I can help guide them away from bad behavior but it is their own determination, which makes them a success.

ALS - Have there been any of your associates over the years who have given you a difficult time in your trading?

POP - Only through ignorance! I can forgive all that. Those who don't learn are their own enemy.

ALS - What must they learn?

POP - Most important they must learn that they don't have to make SELF LEARNED mistakes. They are always better off to learn from OBSERVED MISTAKES. It can be pretty costly to make mistakes in this business. You can not really tell someone what to do but often if you guide him or her they will be more receptive to making the right decision.

ALS - How do you differentiate between self learned mistakes and observed mistakes?

POP - Let us say you go to an eye doctor and he asks you if you can see better out of lens a or lens b. You make a choice and then he goes to the next step by asking you again if you can see out of lens c or d better. This continues until you have the best lens criteria for your eyes.

Well any mistake you make is a self directed mistake and it will hurt only you . No one can teach you not to make this self learned mistake.

Now if you tell the eye doctor you are blind in your left eye when he says cover your left eye and he then says cover your right eye, then you have an observed mistake. You wouldn't make that mistake and since you were affected by that mistake even though it wasn't your mistake you will remember better.

It is better to learn from a mistake which affects you directly that is made by someone else. You have to be mistake aware in trading because there are so many lessons.

ALS - I see. I mean it is clear what you mean on mistakes. Learn from others mistakes and it is cheaper than learning from your own mistake?

POP - I think you have it.


ALS - Do you ever go into the pits much anymore?
POP - To sharpen my thoughts on a market and to re-enforce the proper behavior I often do go back. There is always something to learn from it.

ALS - What happens when you walk into the pit?

POP - At the end of the trading day there are those who come up to me an say "I knew it, I knew you would be selling today, I should have known the market was going down."

ALS - So you move the market?

POP - It seems to be their thought but it isn't the case at all. You see if I am selling to take profits I am aggressive in doing just that. It is that I have a position to get out of and it so happens there are others doing the same thing. Maybe they have a signal close to mine.

It is inaccurate to think anyone moves the markets. If they could I wouldn't trade! The truth is that the BEST LOSER is the long term winner.

ALS - One of the traders had some good suggestions on phases of this book. He calls step one preparation. Let us continue in that suggestion from the "Futures Forum."

POP - Suits me fine. I have seen them grow from my early years and I also have loyalty.

ALS - Note: Phantom's criteria for this insight book is to share with the traders on Futures Forum. Final copy will be somewhat different and expanded. This creates a more timely effort in writing his insight.

"The truth is the BEST LOSER is the long term winner."
---POP
 

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Commodity Futures Trading for Beginners
By Bruce Babcock




The Truth About the Commodity Markets

In order to be a successful trader, you must understand the true realities of the markets. You must learn how the professionals make money and what is possible. Most traders come into commodity trading, lose a substantial portion of their capital and then leave trading without ever having a correct perception of what good trading is all about.

For many years college professors have argued that the markets are both random and highly efficient. If this were true, it would be impossible to gain an edge on other investors by having superior knowledge or a superior approach.

Professional traders, who make their living trading rather than studying the markets from afar, have always laughed at these ivory tower theories. A good example is George Soros, who has made billions of dollars from trading and is perhaps the greatest trader of all time. Here is how he responds to these ivory tower academics: "The [random walk] theory is manifestly false--I have disproved it by consistently outperforming the averages over a period of twelve years. Institutions may be well advised to invest in index funds rather than making specific investment decisions, but the reason is to be found in their substandard performance, not in the impossibility of outperforming the averages."

Mathematicians have conclusively shown the financial markets to be what are called non-linear, dynamic systems. Chaos theory is the mathematics of analyzing such non-linear, dynamic systems. The commodity markets are chaotic systems. Such systems can produce random-looking results that are not truly random. Chaos research has proved that the markets are not efficient, and they are not forecastable. Commodity market price movement is highly random with a small trend component.

Most beginning traders assume that the way to make money is to learn how to predict where market prices are going next. As chaos theory suggests, the truth is that the markets are not predictable except in the most general way.

In his book, Methods of a Wall Street Master, famous trader Vic Sperandeo, whose nickname is "Trader Vic," warns: "Many people make the mistake of thinking that market behavior is truly predictable. Nonsense. Trading in the markets is an odds game, and the object is always keep the odds in your favor."

Luckily, as Trader Vic suggests, successful trading does not require effective prediction mechanisms. Good trading involves following trends in a time frame where you can be profitable.

The trend is your edge. If you follow trends with proper risk management methods and good market selection, you will make money in the long run. Good market selection refers to trading in good trending markets generally rather than selecting a particular situation likely to result in an immediate trend.

There are three related hurdles for traders. The first is finding a trading method that actually has a statistical edge. Second is following it with consistency. Third is consistently following the method long enough for the edge to manifest itself on the bottom line.

This statistical edge is what separates speculating from gambling. In fact, effective trading is actually like the gambling casino rather than the gambling customer. Professional trader Peter Brandt explains successful trading in just this way: "A successful commodity trading program must be based on the simple premise that no one really knows what the markets are going to do. We can guess, but we don't know. The best a commodity trader can hope for is an approach which provides a slight edge. Like a gambling casino, the trader must earn his profits by exploiting that edge over an extended series of trades. But on any given trade, like an individual casino bet, the edge is pretty meaningless."

Unsuccessful and frustrated commodity traders want to believe there is an order to the markets. They think prices move in systematic ways that are highly disguised. They hope they can somehow acquire the "secret" to the price system that will give them an advantage. They think successful trading will result from highly effective methods of predicting future price direction. These deluded souls have been falling for crackpot methods and systems since the markets started trading.

Prolific futures trading author Jake Bernstein describes how these desperate traders are victimized: "Futures trading is ultimately very simple. Any attempt to make trading complex is a smokescreen. Yet for self-serving reasons an army of greed-motivated promoters try to make things complicated. Too many market professionals consider it their mission in life to obfuscate. Why? Because in so doing they give the appearance that their efforts are scholarly and important. They create a need for more information, and then they fill it!"

Books on how to trade commodities are famous for showing a few well-chosen examples where a described prediction method previously worked. They never show what would have happened if you had applied the method religiously for many years in numerous markets. Those who have tested these methods have found that in the long run almost all of them don't work. Be wary of any trading method unless you see a detailed demonstration showing that it has worked for at least five to ten years in a variety of different markets using exactly the same rules.

The job of the person who wants to trade commodities rationally and prudently is to ignore the promises of those promoting pie-in-the-sky prediction mechanisms and concentrate on finding and implementing a proven, integrated methodology that follows market trends
 

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Oggi apertura in ennesimo gap down, il terzo in pochi giorni, che a sua volta andava a coprire un lontano gapup aperto a ottobre. Il vostro affezionato rimane con un ordine rimasto penzoloni a 60cents perdendo il punto più facile della settimana sulla ricopertura del gap fino a un rimbalzino tecnico a 62,40 guidato da ricoperture del locals e acquisti dell'industria. A fine seduta cmq ritorna la pressione in vendita dei fondi gonfi di long ,che spinge le quotazioni al close di 60,55.
KCH03daily-12-12-2002.JPG
 

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CSCE coffee hits nine-week low as funds sell
NEW YORK (December 13 2002) : CSCE coffee futures closed down for the fourth straight day on Thursday after hitting their lowest in nine weeks as the still-too-long commodity funds used any uptick to liquidate positions, brokers said.

"It's still all about the funds. They held a record long position and they got stuck with it.

I think they still have more for sale," said one commission house broker.

"A fund broker offered 500 lots of Mar on the open, and funds and speculators continued to push it down," a floor broker said. "Funds have gotten out of most of their Mar longs in selling from last Friday to today.

"Industry buying was good this morning and locals covered," he continued. But as the market got into higher ground, "three brokers were selling for funds," and prices fell back.

"The market's technically oversold here," the broker continued. "In Brazil, they're saying the next arabica crop will be down 50%, but we'll see what the government says next week."


However, buying from European roasters was seen in May and US roasters were bidders for March contracts.

Producers were also buyers on the decent, covering some hedges that they hope to reset on a bounce or rally, sources said.

March coffee fell 1.20 cents, settling at 60.55 cents a lb after trading from 60.30 cents to 62.40 cents.

March has plummeted 10.55 cents so far this week, and hit its lowest since October 11 on Thursday. May coffee slid 1.25 cents to 62.95 cents.

Spot December coffee settled at 58.05 cents, down just 0.20 cent.

There were 37 delivery notices Thursday against the December contract, bringing the cumulative total to 3,493 notices.

Last trading day for December is December 17 and open interest is down to only 167 contracts.

Last trading day for the January 2003 coffee options is Friday, but most brokers do not expect the expiration to affect the market with just 52 calls open at the 57.50 strike and 610 lots open at 60 cents.

Physical coffee business in Brazil is slow as traders await next week's official forecast for the 2003/03 (July/June) coffee crop, amid expectations for a sharp cut in output.

The coffee trade is eagerly awaiting this official forecast by the No 1 producer and exporter of coffee.

Traders talk of a crop in the 32-35 million 60-kg bag range, down sharply from the 2002/03 crop.

The USDA recently pegged the crop at a record 51.6 million bags.

Brazil's bumper crop and surging robusta output from No 3 producer Vietnam are largely behind the global supply glut, industry sources have said.

That, along with slack consumption, helped push global coffee prices to record lows in December of 2001.

Independent forecaster Meteorlogix on Thursday predicted daily episodes of scattered to widely scattered showers and thunderstorms during the next five days with temperatures near to below seasonal norms.

Estimated volume slowed to a still brisk 16,006 lots Thursday compared with the official tally of a torrid 25,641 lots traded on Wednesday, which included 573 Against Actuals.

Call volume came to an estimated 6,021 lots and put options amounted to 3,928 lots.

The extent of the long liquidation could be seen in the open interest data, which was trimmed by 6,669 contracts to 67,832 lots.

Technicians lowered support for March to 60.30 cents, Thursday's low followed by 60 cents, with resistance at 63.25 cents.

Sentiment numbers fell to 34 percent bulls from 42 percent the prior week, according to the latest Bullish Consensus weekly hotline by Market Vane Corp.

The 12-month high-low range of these closely watched industry numbers was 48 to 5.

KCH03intraday12-12-2002-5min.png


Brazil Coffee: traders focus on low 2003-04 crop
RIO DE JANEIRO (December 13 2002) : Business is slow as traders focus on next week's official forecast for the 2003-04 (July/June) coffee crop, amid expectations for a sharp fall in output and resulting higher prices next year.

The Agriculture Ministry's forecast, based on field surveys in Brazil's seven coffee producer states by 200 officials, is expected on Dec 18 but still has to be officially confirmed.

Traders talk of the crop falling to between 32 million and 35 million 60-kg bags from around a record 52 million bags in 2002-03.

Some even say this year's crop may have reached 60 million bags.

"The official estimate is traditionally much lower than trade figures but provides a reference," said a Santos-based trader.

In its last official estimate in June, the government put the crop at 44.69 million bags but is expected to revise the total up next week. Harvesting was completed by end-September.

SHARP FALL SEEN IN ARABICAS: Traders said the key point is that the sharpest fall in production would be in Group 1 fine arabica coffees from south Minas and the Cerrado of west Minas.

"The world drinks mainly Brazilian arabicas," said a Rio de Janeiro trader, adding a lower Brazilian arabica crop would help prices recover next year.

Production of Group 2 arabicas from the forested zone of Minas Gerais and Espirito Santo as well as cheaper robustas, or conillon as they are known locally, would fall much less.

Growers expect next year's crop to plunge by 40 to 70 percent, depending on the region and type of coffee, due to the downturn in the biennial crop cycle, drought, heavy pruning and lack of crop care.

At the Sao Sebastiao do Paraiso (Cooparaiso) co-op, in the southern part of Minas Gerais state, chief economist Marcelo Almeida said he expected the coffee crop to be about 60 percent smaller next year.

The co-op's detailed forecast has been delayed until next week due to the slow development of the crop following drought in September and October which ruined tree flowering.

Rainfall in November and December is helping trees to recover and coffee cherries to grow, but is too late to help next year's crop, Almeida said.

"The last two days were very wet. Normal seasonal rain is returning," he noted.

So far in December about 110 millimetres (4.3 inches) of rain has fallen in the Sao Sebastiao district, compared with a December average of some 350 mm (13.8 inches).

On Thursday, local meteorologist Somar forecast heavy rain in south Minas and the Cerrado region continuing until Dec 23.

FUTURES FALL, BUSINESS SLOWS: This week's fund-driven fall in arabica futures prices resulted in producers retreating from the market and withdrawing offers, traders said.

"The domestic and fob markets came to a halt when New York fell," said Santos-based trader Jorge Esteve.

In addition, roasters in the United States, Europe and Japan were said to be well stocked and there is increasing amount of new crop Central American coffee coming to market.

"The funds liquidated because they were too long. There is a danger they may now go short," said Rio de Janeiro exporter Flavio Ribeiro, adding that fundamentally the market should recover next year due to a much smaller Brazilian crop.

Although Brazil produced a lot of coffee this year, it has already shipped and consumed a lot, he added.

Exports of green and soluble coffee are expected to reach a record 28 million bags in 2002, shattering the 2001 record of 23.5 million bags.

Export figures from the Council of Green Coffee Exporters of Brazil (Cecafe) on Tuesday showed that Brazil shipped 2.61 million tonnes of green coffee in November, up 8.1 percent from a year ago.

"Shipments would have been higher but for delays caused by a shortage of containers and overbooking," said Santos-based Jorge Esteve, adding he expects December shipments to stay strong.

Containers are in short supply due to a decline in Brazilian imports linked to a sharp devaluation of the real against the dollar this year.

Export differentials remain attractive even though Swedish quality 14/15/16 screen size tightened with the fall in futures to 21 cents a pound (offered) under March New York arabica futures, from 24 cents under last week.

Domestic prices are reluctantly following New York prices down with benchmark fine cup southern Minas quoted on Wednesday at 197-200 reais per 60-kg bag, only a tad down from three weeks ago.

Internal market (reais per 60-kg bag).

============================================================ Bid/Offer Dec 12 Nov 22============================================================Southern Minas Gerais bica fina 197-200 200-202Cerrado Minas Gerais screen 17/18 215-218 215-220Espirito Santo (Vitoria) robusta 7/8 145-147 136-139Export (cents/lb against CSCE "C" March contract)Swedish 14/15/16 -22/-21 -24/-23Santos 2,3 17/18 fino -18/-17 -20/-19Conillion 5/6 13 -2.0/-1.0 -3.5/-3.0Specialty (cents/lb traded price vs Dec CSCE "C" contract)General-region pulped natural -18/-16 -19/-17Washed Bahia -15/-14 -16/-14Certified organic (outright price) $1.00 $1.00 $3.770 $3.577============================================================
-Reuters
 

Fleursdumal

फूल की बुराई
Seasonal Futures Spreads: A Quick Introduction


1. Seasonal Spreads are simply a simultaneous buy and sell in different futures contracts. The trader is only concerned with the relationship between the prices of the different contracts involved and not with the direction each individual contract may move.


2. If a trader thinks the difference between the contracts will increase, it would be possible to win on the trade as long as the contract he buys goes up more than the one he sold, or even if the one he sold goes down more than the one he bought.



3. If a trader thinks the difference between the contracts will decrease, it would be possible to win on the trade as long as the contract he buys goes up less than the one he sold, or even if the one he sold goes down less than the one he bought.



4. These trades can involve either the same commodity with different delivery months (i.e. buy July Wheat and sell December Wheat), or different commodities (i.e. buy December Wheat and sell December Corn). We look for Seasonal Spreads that have a strong historical pattern of consistency. Although past performance does not insure future results, we sure do like to have a strong historical tendency in our favor during the time of the trade.



5. Upon entering the trade, we usually set an initial profit objective and we always have a predetermined risk level. To help establish these levels, again we find it helpful to research the history of each Seasonal Spread over the past 15 years.





Seasonal Spreads: A Detailed Explanation



The idea of "seasonal trading" in individual futures markets and futures "spreads" is based on the repetitive price patterns that many markets can exhibit throughout the year. Evaluating different known repetitive trading opportunities every month may be one of the oldest uses of a "systematic trading strategy".

For example, in physical commodity markets such as the grains, price patterns from lows to highs may be based on the normal planting and growth schedules, combined with weather cycles and demand factors. Prices may make seasonal peaks just as supplies from old crops are dwindling, before new-crop supplies are assured and hit the market. In the financial and stock markets, there are also rhythms based on institutional or government buying and selling. Annual investment patterns in the equity markets have made the 6-month period from November to April far more profitable than the other six months of the year.

These "seasonal" patterns of supply and demand and the associated price patterns can be an important criteria for evaluating trading opportunities, and all traders should be "aware" of any strong seasonal tendencies normally associated with a market they are considering trading. In addition, seasonal trading and futures spreads can provide unique profit opportunities for traders willing to study this under-appreciated resource in the trading world.





Seasonal Spreads: Questions and Answers


Which markets are this strategy used in?
We monitor numerous futures markets for seasonal strategies that fit the criteria. These markets include: Grain markets (corn, wheat, soybeans, etc.), Metals markets (gold, silver, copper. etc.), Financial markets (stock index futures, bonds, currencies, etc.).

Does this strategy use options or futures contracts?
Futures contracts are used for many trades, but options may also be used if they can provide us with an edge.

What is the maximum risk on this strategy?
Risk levels on each trade will vary but every trade will have a pre-determined exit strategy at a specified level of loss. If left unattended, seasonal spreads could have unlimited risk.

What is the maximum profit potential of this strategy?
Seasonal Spreads have unlimited profit potential but we normally suggest pre-determined profit objectives for at least part of the position.

How much of my time will it take to use this strategy?
It is up to you how closely you wish to follow each trade. Most traders who work with us stay in touch once or twice a week. (Stop Loss) orders and profit objective orders can be taken at the same time as the entry order. This would allow you to continue trading even when you are busy or on vacation. There is no need to be glued to a quote screen all day.

How often is this strategy used?
Sometimes good opportunities seem plentiful and other times we simply wait for a nice looking trade setup. Generally speaking, with all the different market combinations, there is usually a good seasonal spread available on a regular basis.

How much trading capital does this strategy require?
Some spreads have as little as a few hundred dollars margin requirement. Others have substantially more. We recommend at least five to ten thousand dollars be made available for seasonal spread trading.





Seasonal Spreads: A Summary of Benefits



1. Lower margin requirements than straight futures positions.

2. A wide variety of trading situations to choose from.

3. Not dependent on calling the correct market direction of individual contracts.

4. May be easier to predict market relationship patterns than price direction.
 

Fleursdumal

फूल की बुराई
Lunedì positivo con il contratto marzo che apre in gap , parzialmente ricoperto, e chiude poco sopra i 61 cents a nn molta distanza cmq dal minimo a 60 fatto registrare venerdì scorso.
Chiude bene anche il caffè varietà robusta quotato al LIFFE di Londra:
-- ODJ Liffe Coffee Review: Ends Up On Lack Of Sales;Spreads Dominates


By Ian Stephenson
London, Dec. 16 (OsterDowJones) - Liffe Jan robusta coffee futures settled
slightly higher Monday, supported by a lack of selling as well as strong gains
by arabica coffee futures traded on New York's Coffee, Sugar and Cocoa
Exchange, brokers said.
Liffe prices were slightly higher in early trade supported by a lack of
selling. Following recent falls, producers are reluctant to sell at current
levels after having seen prices trading around $100/ton higher.
But with the prospect of more origin selling, roasters are also reluctant
to chase values sharply higher, as they perceive that they will be able to
cover at or near current levels in the short term, they added.
Liffe prices rose when the CSCE market started to head higher, but
outright volumes remained thin as spread trades across Jan/Mar and Mar/Mar
dominated activity, brokers said.
Short term, a broad trading range is likely to develop, but if prices were
to slip below $720/ton, basis Mar, then the funds could be encouraged to
liquidate more of their long positions - although few doubt that they will
liquidate all their positions.
"The funds would prefer to remain slightly long (in London)," a Liffe
coffee broker said.
Similarly, prices are unlikely to break sharply higher, as producer
selling is expected to cap any rise, especially having witnessed the recent
falls, brokers said.
In its latest coffee market report, the International Coffee Organization
sees world coffee production at 120 million 60-kilogram bags for the coffee
year 2002-2003 (October-September).
The estimate for the 2002-03 season, based on current figures, would make
this season's crop 9% higher than the 109.8 million bags produced during the
2001-02 season, according to the ICO.
It said that global availability (world production plus stocks) stood at
150.7 million bags in the 2001-02 season, with estimates for the 2002-2003
crop year pegged at 159.8 million bags.

Settlements: Jan up $18/ton at $722/ton, volume 3,663 lots.
Mar up $17/ton at $740/ton, volume 4,305 lots.
May up $18/ton at $756/ton, volume 2,088 lots.
Mar range: $727-$745/ton
Volume: 10,696 lots.
 

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