THE BENNETTS MONTHLY JUNE '24

Marketing - HAB
3 June, 2024

All things Bennetts and Coffee...

Welcome to the June edition of the Bennetts Coffee Newsletter!

Can you believe its June already! and while the weather might be cooling down, our love for caffeine is hotter than ever! So, grab a cup of your go-to brew, get cosy, and prepare to indulge in some ripper coffee news and insights.

We've got the lowdown on the freshest trends in the coffee market, a snapshot report on the Donas Do Café Initiative in Brazil, and exciting news about the newest Bennetts Team Member.

 

MARKET REPORT

If any of these terms in the market report are confusing, we urge you to use Investopedia to make sense of them. We have found it to be a brilliant tool when learning about all things trading, futures and currency.
 
NY C movements and the Brazilian Impact
 
Following on from one of the more animated months for the C in recent memory, May also provided some headaches for those trying to predict the direction of the market. Opening at 214.65 c/lb on the 1st of the month, many roasters would’ve been pleased to see levels drop down below the 200 c/lb mark to the monthly low of 192.15 c/lb on the 7th. The market plateaued (relatively speaking) for a week or so to figure out what direction it would head. Whispers about some cold weather in Brazil (usual for this time of year) put the market on frost warning and drove a rapid rally back up to a monthly high on the last day of May at 237.75 c/lb.
 
The USDA’s recent report on Vietnam’s upcoming crop size upgraded it to over 29 million bags due to higher expected yields resulting from favourable weather conditions as well as better investment in production on the back of high prices. This saw speculators bail from the “C”, thus closing out the month with the July terminal settling at 222.35 c/lb. The lack of any damaging cold-weather events in Brazil would have also contributed to the late-month sell-off.
 

  May 2024 NY C Graph

With such large swings in the C price, one wouldn’t want to be caught on the wrong side of it! The month of May had a 45.6 c/lb difference between the low and high for the month. For context, if you were the unlucky individual buying a contract at the monthly high, instead of the low, the 45.6 c/lb difference would equate to $17,000 USD for just one contract (37,500 lbs).  We wouldn’t be surprised if we continue to see these swings in the C price over the coming months as we enter the Southern hemisphere’s winter, which brings a heightened risk of frost across Brazil’s coffee growing regions.
 
The London Robusta market followed a similar trend to that of the C… or maybe the other way around given the fundamental lack of supply for Robusta. Either way there’s not much news on the robusta front, other than the fact that it is expensive… so expensive that roasters are starting to look to other non-traditional robusta origins or lower grade arabicas (where possible) to reduce the costs of their blends. Strange times indeed.

As the First Notice Day for both the Arabica and Robusta futures approaches in the second half of June, it's uncertain what price levels we'll be discussing this time next month!

  Robusta London Market Graph May 24'

Certified Stocks
By the end of May, Arabica had nearly 790,000 bags positioned in certified inventories. This is continuing to grow month on month and is 129,000 bags higher than the last report. This continued upward trend is a result of Brazil exporters opting to deliver to the market to capitalise on a decent pricing in lieu of strong demand. Robusta had nearly 46,370 MTs in store which again has increased from the previous report. Turns out record highs in the Robusta market are good for replenishing certified stocks… who knew?  
 
Commitment Of Traders Report
Month on month, the COT report shows speculators reducing their long position by almost 10,000 lots to an overall 67,800 lots as the specs saw fit to engage in some profit-taking. If there is any supply shock, we should expect the funds to add more longs to their positions.


CELEBRATING THE DONAS DO CAFÉ PROJECT

In this month's newsletter, we are thrilled to highlight the remarkable Donas do Café project; a collaborative initiative between SMC and Cooxupé in Brazil. This project is dedicated to empowering women who are cooperative members and partners within the specialty coffee market.

Empowering Women in Coffee
Donas do Café aims to engage women in the coffee industry, fostering a sense of belonging and encouraging them to occupy leadership roles and participate in decision-making processes. This initiative is a beacon of empowerment, showcasing that women can and should take their rightful places in the coffee industry.

Annual Donas do Café Meeting
The annual Donas do Café meeting, held on May 15, 2024, was a significant event following on from the celebration of International Women's Day in March. This meeting included the distribution of profits from the sale of Donas do Café coffees, negotiations around product specifications and insightful lectures on cooperativism, environmentally friendly actions, and crop management.

Inspirational Speakers and Topics
The day featured notable speakers, including Natália Carr, PhD in Agronomy and ESG Manager at Cooxupé, who emphasised the importance of socio-environmental practices in coffee growing. Cibele Medeiros, an agronomist specialising in biological management, discussed the long-term benefits of sustainable farming practices. Marisa Contreras, a coffee producer from Fazenda Capoeira, highlighted women's leadership in cooperatives and the coffee production chain, sharing valuable data on female entrepreneurship in Brazil.

Profitable and Sustainable Practices
The Donas do Café project has not only empowered women but also provided substantial financial benefits. In the latest Donas do Café export blend, 70 women contributed their coffees, receiving over R$150,000 (USD 30,000) in extra premiums. The project has seen an average annual growth of 20%, thanks to the support of the customers who believe in its mission.

Global Reach and Quality Recognition
In 2023, SMC traded more than 6,000 bags of Donas do Café blends, reaching top destinations including Australia, the United Kingdom, the United States, and Japan. These specialty coffees, identified through the Especialíssimo program, reflect the exceptional work of women in the industry. The blends are known for their fruity profile, high sweetness, marked citric acidity, creamy body, and long, sweet aftertaste.

Commitment to Sustainability
The Gerações sustainability protocol, set to be a criterion for the Donas do Café project starting in 2024, assesses socio-economic and environmental practices on properties. This commitment to sustainability ensures that the project not only benefits the women involved but also promotes responsible coffee growing.

For more information on the Donas do Café project, including sustainability initiatives (Especialíssimo program and Gerações protocol) or if you would like to show your support, get in touch with your Bennetts Account Manger today!

Annual Donas Do Cafë Meeting - 2024 


EMPLOYEE UPDATE

We are excited to welcome Rina to the Bennetts Family! Rina has joined us as our new Administration and Payroll Officer, bringing a wealth of experience in administrative tasks across various sectors. If you see Rina at Bennetts HQ, please be sure to say hi and give her a warm welcome. We are thrilled to have Rina on the team and look forward to her valuable contributions.


KINGS BIRTHDAY AND STOCKTAKE CLOSURES

Please be advised that our office will be closed on Monday the 10th of June for the Kings Birthday Holiday.
Please place your orders by 12.30pm on Friday 7th June for despatch on Tuesday the 11th of June.

Also please be advised that will be conducting our end of financial year stocktake at our Melbourne warehouse on Friday 21st June 2024.
Therefore, no orders will be processed or despatched on this day.
Orders received and processed by 12.30pm on Monday 24th June will be despatched on Tuesday 25th June.

If you have any questions and or queries on these matters, please contact your Bennetts Account Manager directly and/ or the Bennetts office on 03 9853 0328 or trading@hab.com.au


 
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