Welcome to the December Edition of our Coffee Newsletter!  

As we approach the end of 2024, it's time to reflect on another year in the world of coffee. In this month’s newsletter, we’ll share details about our upcoming Christmas and New Year office closures, provide insights from our latest market report, and hear from our cupping room about some of the exciting new arrivals now available.

For the final time this year – grab a brew and enjoy the read!

2024 END OF YEAR CLOSURES

As we near the end of 2024, we’d like to take this opportunity to share some important updates that we know will be of interest to you.

1. If Bennetts are organising your delivery from Melbourne and you need to receive your order before Christmas,
your order needs to be received by:

• WA, FNQ, & TAS Customers:                              12:30pm (AEDT) 6th December 2024
• QLD Customers:                                                   12:30pm (AEDT) 9th December 2024
• NSW, ACT, SA, & regional VIC Customers:       12:30pm (AEDT) 12th December 2024
• Melbourne Metro Customers:                               12:30pm (AEDT) 18th December 2024

• Last day for despatch in 2024: Friday 20th December 2024
• Last day for collection in 2024: Monday 23rd December 2024
• First day for collection/despatch in 2025: Friday 3rd January 2025 (order needs to be received by 12:30pm Thursday 2nd January)
• Bennetts Office Closed:
  • 25th December
  • 26th December
  • 27th December
  • 1st January

Please do not hesitate to contact your Bennetts Account Manager directly or our office if you have any questions and/or require any additional information.

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.

And there you have it. After what can only be termed the “bull-run from hell” by those of us on the receiving end, the March-2025 NY coffee futures price peaked at a 47-year high of 335 US cents/lb, just 5 cents shy of the all-time high of 340 US cents/lb, set way back in 1977!  

Having started out the month at an already-uncomfortable level of just over 240 US cents/lb, the market proceeded to rally 95 cents in an almost uninterrupted fashion right through to the end of the month (which is an impressive 40% in a month). And as spectacularly, prices dropped...  


 

All-time historic Arabica NY C Graph

So, what has fuelled this rally, you ask, dear reader? And more importantly, is it over?  To answer the first question, we could carry on for longer than this report allows, but to summarise things, there was a confluence of factors that resulted in the “perfect storm” we endured all last month: 

1. After a solid year of good prices, growers are now (for the most part) fairly cash-positive, so their drive to sell is not quite as high as it would have been during previous rallies.  

2. Roasters are on the other hand, not carrying quite as much inventory, as prices have been very high, and they are reluctant to take large physical positions for fear of getting stuck with expensive stock if/when the market finally turns around. This leaves them vulnerable to price squeezes as they are not able to wait for prices to come down before having to re-enter the market. 

3. The December 2024 futures contract entered its notice period, which meant the shorts needed to clear their positions prior to First Notice Day (FND), and the longer they waited, the worse it got.  

4. Speculators. Managed money funds saw an opportunity to just add fuel to the bin fire, as resistance to the upside was minimal on account of the points described above.  

As for the second question, we can’t really say for sure… As of writing, March NY had dropped 22 cents in one session, which is more than it had gained during the preceding week. It’s a good start, sure, but should not yet be taken as a sign that all is well and dandy now, nothing to see here, move along.  

Ultimately, where the market goes will hinge on the initial crop reports out of Brazil, following the extended dry season the coffee growing areas had to endure earlier in the year. That there was damage to the upcoming crop’s potential size, there can be no doubt. It’s a question of how much damage. We won’t really know for certain for another couple of weeks, as these reports traditionally start appearing in mid-December onwards. If the forecast is “not too bad”, then we could see prices potentially drift a bit further to the previous November range of 240 to 250 cents/lb. We hope to update you in a further market report, before years end. 

It may, however, be a wise move for the more prudent among us to take some physical coffee cover during this moment of uncertainty, because if there is a whiff of worse-than-expected news in these reports, then strap on that space suit because it’s a one-way trip to the moon for all of us.