Daily coffee market review 10/09/2020. COFFEE C FUTURES (CONTINUOUS: CURRENT CONTRACT IN FRONT) ICEUS:KC1! Commodity-market-review Consult free of charge our daily reviews with graphs, tables, maps on our website: https://www.commodity-market-review.com/ REVIEW TECHNICAL ANALYSIS OF ARABICA COFFEE Yesterday, ICE US coffee futures closed higher at 110.35 ct / lb . Arabica coffee after a fall of more than 20%, is trading between 106 and 110 cents. The trend is still bearish . Brazil is the world's largest coffee producer and alone accounts for about 50% of the world's Arabica production. The harvest is finished there, and it is very good, and could be the second largest ever recorded with more than 61 million bags just below the record of 2018. Indeed, Arabica coffee trees are on a 2-year cycle that alternates small and large yields. We are on the 1st year of the high yield cycle. Demand is low, the coronavirus pandemic is not weakening, the sad mark of 1 million deaths due to coronavirus is crossed, and 35 million cases of infection. Many countries are considering or are in the process of closing down bars and restaurants that are places of high coffee consumption. Several European capitals such as Paris, Madrid, Brussels, ... have announced the closure of bars to fight against the epidemic. Brazilian producers are taking advantage of the weakness of the Brazilian currency to sell. The International Coffee Organization ( ICO ) forecasts a surplus of 1.54 million bags for the 2019/20 season. The announcement, of President Donald Trump tested positive for the coronavirus, less than a month before the American election, is fuelling the news. The American president decided to suspend the negotiations with the Democrats for a new recovery plan. Donald Trump, ahead in the polls, a few weeks before November 3, announced instead targeted aid for sectors in difficulty as well as direct financial aid for households. Increased volatility is to be expected on all markets until the American election. METEO COFFEE WEATHER REVIEW IN BRAZIL The harvest is finished in Brazil. In the southern hemisphere, the coffee tree starts flowering between August and October. A lack of water and good sunshine is necessary. However, a moderate rainfall is also desired to guarantee a good development. 90% of Brazilian coffee is cultivated in 4 regions: Minas Gerais, Espirito Santo, Sao Paulo and Parana. Seasonal forecasts for the month of October for these 4 regions of the Brazilian coffee belt predict below-normal rainfall of -20 to -60 mm. The climate has been particularly dry in the entire Brazilian coffee belt last week. REVIEW OF CERTIFIED ICE COFFEE STOCKS Coffee stocks are stable at 1.098 million 60 kg bags compared to 1.097 the previous day. ICE US stocks of Arabica coffee are below the five-year average. The low stocks may provide some support to the coffee price on futures contracts. DOLLAR REVIEW The DXY index representing the USD against a basket of foreign currencies closed yesterday's trading at 93.61. The DXY index, which represents the USD against a basket of foreign currencies, was unchanged at 93.61. The DXY continues to move between 93.3 and 94 from a week ago. The U.S. President has dashed any hopes of a new plan to support the economy ahead of the election. Donald Trump being left behind in the polls, investors are hoping for a bigger post-election stimulus package from the Democrats. On the FED side, things will certainly remain frozen until the result of the American election. On Wednesday, the FED minutes insist on the need for a quick vote on a support plan, and ensure that the key rates will remain permanently low. Yesterday, the Brazilian Real closed up slightly higher at 0.1783. The trend is still bearish , the fear of a 2nd epidemic wave and the gross public debt having reached 87% of GDP weigh on the Real. The BRL /USD pair is positively correlated with coffee futures prices. The low Real benefits Brazilian coffee exporters who take advantage of their increased competitiveness to flood the market. A low Real increases the competitiveness of Brazilian producers and provides an incentive for them to export.