As we enter the final stretch of the year, November is shaping up to be full of impact and reflection. From our recent origin trip to Colombia to important initiatives like Movember and Grounds for Health, we're excited to share updates on our journey and efforts to make a difference. Alongside our monthly market report, the office will be closing for the upcoming Victoria public holiday as we prepare for the busy end to the year!

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.

October started with a critical piece of news to the fundamental landscape of the coffee futures markets for both Arabica and Robusta. We touched on it quickly in our previous edition of the newsletter, yet it’s worth mentioning again. The European Union Deforestation Regulations (EUDR) are set to be postponed one year and come into force at the end of 2025. News of this delay relieved pressure in the markets and saw a rather sharp drop in levels over the following five trading days. This proved there was a ‘risk premium’ priced into the market in anticipation of the EUDR coming into effect at the end of the year.

The delay in implementing the EUDR is interesting, as its timing could influence the short-term market trajectory. Many major trade houses were, and in some cases still are, anticipating that a significant volume of coffee would be tendered for physical delivery. This would allow exporters to clear non-compliant inventory from their books ahead of the regulation. For this to happen, the coffee must land and be graded at one of the designated warehouses at destination (these warehouses are in North America and Europe at some major Ports). This is also why we are seeing certified stocks increasing now which is evident with more than 100,000 bags of Arabica pending grading this week.

Arabica opened October hitting its high of 271.45c/lb and five trading days later bottomed out at 243.35 c/lb. Similarly, Robusta opened October at its high of 5,236 USD/MT but unlike Arabica managed to plateau a touch more that saw its low later in the month at 4,296 USD/MT. Through the second half of the month, Arabica felt a few more fluctuations because of the flowering out of Brazil and Robusta seemed to take a steadier bearish trajectory.

October Arabica NY C Graph 2024

Robusta London Market Graph October 2024

As usual for this time of the year, most coffee traders enjoy short stints as meteorologists, experts in rainfall patterns over Brazilian coffee growing regions. This year, thankfully the rains arrived and in copious amounts to induce the main flowering of the year for Brazil. Despite the fact these rains arrived at a ‘normal time’, many Brazilian producers say that it is in fact late as the trees went into dormancy and stressing phase early. This meant that some damage to the future crop had already been done by the time the rains had arrived.

Consequently, there are few things to take note of. First, some producers that weren’t willing to wait for the rains decided to prune or stump their trees, which means there will be no harvest in their upcoming crop. Second, some trees lost their foliage during the prolonged stressing time. And finally, due to the lost foliage, some trees are likely to put more energy into growing leaves as opposed to fruit. It won’t be until December, when the first crop estimates start to come in, that we get a clearer picture of how all these factors will affect the Brazilian production. Until then, it will all be wild speculation, so our advice is to consider the source before jumping to conclusions.

GROUNDS FOR HEALTH - UPDATE

At Bennetts, we believe in supporting causes that directly benefit the lives of those who make the coffee industry thrive. For 2024, we are continuing our partnership with Grounds for Health, an international non-profit dedicated to providing essential cervical cancer screenings and treatment to women in coffee-growing communities.

Grounds for Health, founded in 1996, has built an enduring connection with the coffee industry, working to break down healthcare barriers in some of the world’s most rural and underserved areas. Over the years, they have achieved remarkable milestones, screening more than 232,500 women and providing life-saving treatment to over 19,000 women for cervical pre-cancer. In the Oromia region of Ethiopia, where Grounds for Health has been active since 2017, they have screened 35,602 women and treated 2,660—critical steps toward reducing preventable deaths from cervical cancer.

This year, our donation has been directed to Grounds for Health's efforts in West Guji, a region they have supported since March 2021. In this area, they collaborate with three Woreda district health centres and a referral hospital to deliver screenings and treatment. In 2024 alone, they have tested 771 women using VIA (visual inspection with acetic acid), identifying 90 women in need of treatment for pre-cancerous lesions. Our contribution helped fund screening for one-quarter of these women, providing vital healthcare to 192 individuals who may otherwise not have had access to these life-saving services.

Grounds for Health’s work in West Guji is a part of their broader mission to provide women-centred, high-quality care in coffee-growing regions. What makes this year particularly exciting is the organisation’s planned transition to HPV testing in 2025, which marks a major step forward in the fight to eliminate cervical cancer, the second most prevalent cancer in Ethiopia. HPV testing, a more accurate and high-performance screening method, will significantly increase their ability to detect and treat cervical cancer early. They plan to begin implementing HPV testing in West Guji by January 2025, further expanding their capacity to reach more women and make an even greater impact.

We are honoured to support Grounds for Health in their ongoing efforts. The work they do not only saves lives but also empowers women in coffee-growing communities by providing them with access to healthcare that can help them live longer, healthier lives. To learn more about their mission, the transition to HPV testing, and the incredible work they continue to do, we encourage you to visit their website.

Your continued support helps make contributions like this possible, ensuring that we can keep backing organisations that create real and lasting change for women in the coffee industry.

COLOMBIA BRIEF TRIP UPDATE

Our recent origin trip to Colombia this October was an enriching journey that provided us with valuable insights into the country's coffee industry. One of our main objectives was to connect with some of our long-term suppliers, experience new coffees with experimental processing methods, and better understand the evolving landscape of coffee production in Colombia.

Throughout our time there, we witnessed firsthand the impact of climate and various macro and micro factors on the coffee supply chain. Colombia is currently facing significant challenges beyond just weather conditions. While the weather has been relatively stable, allowing for a smooth growing season, other external factors such as political shifts and economic pressures are creating ripple effects throughout the industry. These dynamics are shaping not only coffee production but also the ability of roasters in markets like Australia to access consistent, high-quality coffee from the region. It was eye-opening to hear from producers how they are navigating these complexities while continuing to push forward with innovation and sustainability.

We also had the privilege of attending the Producer & Roaster Forum (PRF) in Colombia. The event was a fantastic opportunity to engage with a diverse range of industry stakeholders, including farmers, exporters, and roasters, all gathered to discuss the future of coffee. The forum provided a platform for robust conversations about emerging trends, market challenges, and how Colombian coffee is evolving to meet global demand.

During cupping sessions, we were fortunate to sample new coffees featuring experimental processing techniques that are shaping the future of Colombian specialty coffee. These unique lots highlighted how producers are pushing boundaries to achieve new flavour profiles, enhancing the cup quality and variety available from Colombia. It was a clear demonstration of the country’s ability to adapt and innovate while maintaining the high standards for which it is known.

Sustainability and community-driven initiatives were another key theme throughout our trip. Many producers are doubling down on environmentally conscious practices and investing in the next generation of coffee farmers. Their commitment to reducing the environmental impact of coffee production and supporting their local communities is truly commendable and aligns with our own values of sustainability.

Overall, our trip to Colombia was invaluable in reinforcing our partnerships, deepening our understanding of the challenges and opportunities facing the coffee industry, and discovering exciting new coffees. We look forward to sharing more in-depth insights, alongside some of the coffees we cupped, in an upcoming report and on our social platforms, so stay tuned for more details!

Harry cupping some exciting coffees during our visit to Colombia

MELBOURNE CUP CLOSURE

Please be advised that our office and Melbourne warehouse will be closed tomorrow, Tuesday the 5th of November, for the Melbourne Cup Public Holiday in Victoria.

Normal despatches will resume from our Melbourne Warehouse on Wednesday 6th November.

If you have any queries, please contact your Bennetts Account Manager, or give the office a call on (03) 9853 0328.

MOVEMBER 2024

At Bennetts, we’re excited to step up for Movember this year in support of men’s health! Some of our team will be growing moustaches to spark conversations, while one brave Marketing Coordinator, Nathan, is taking on a huge challenge: running 60km in a day around Albert Park!

We’re joining this important cause to raise awareness about mental health, suicide prevention, and physical health challenges like prostate and testicular cancer—issues that affect the men in our lives and communities.

We’d love for you to be part of this journey with us! To learn more about our involvement and how you can donate, follow the link here and join the cause.

Together, we can make a real difference.

Happy Roasting,
The Bennetts Team

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The latest news and views from the Bennetts team

THE BENNETTS MONTHLY NOVEMBER '24

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