The internal physical market has been short and firm, finding support in the firmness of ICE, the strong dollar, and the withdrawal of sellers. Arabica good cup from southern Minas Gerais with 15% of defects is indicated at BRL 1,230 to 1,240 and remains very close to the recent highs. The market remains strong, which also justifies the sellers’ short stance. Fine cup is indicated between BRL 1,260 and 1,270 in Cerrado.
Rio cup is around BRL 1,150 a bag in Matas de Minas with 20% of defects. It finds support in the limited physical availability. Conillon, on the other hand, is indicated at BRL 750 per bag for type 7/8 in Colatina (ES). The description shows a timid reaction, following the robusta’s gains on ICE Europe. The local roast and ground industry has significantly reduced purchases, with large roasters already well covered for the coming few months. Besides, Brazilian conillon still has little external competitiveness compared to Asian origins, even after the decline in the premium paid for conillon FOB port. Without support from demand, this description loses strength in the internal physical market, which limits upward moves.
