Could 2024 be the year ICE Arabica coffee futures revisit their peak? With the bullish trends in soft commodities, coffee’s climb is worth watching.
ICE Arabica coffee futures showed a 12.55% annual gain in 2023.
Recent trends suggest a potential rise in coffee futures, echoing growth in the soft commodities sector.
Arabica futures recorded a high of $2.0390 per pound in December 2023.
Robusta coffee futures have surged, reaching over a decade high in January 2024.
Other soft commodities like FCOJ and cocoa have seen significant rallies.
Arabica coffee futures may challenge the 2022 high as the overall sector trend remains upward.
Will ICE Arabica coffee futures challenge their 2022 high in 2024? The price action in the sector and the recent bullish patterns in soft commodities suggest that Arabica coffee futures have a strong chance of approaching or even surpassing the previous peak.
In 2023, ICE Arabica coffee futures surged by 12.55%, finishing the year on a high note of $1.8830 per pound. This upward trajectory has continued into 2024, with hints of further growth on the horizon. Moreover, the broader trends within the soft commodities market lend credence to a potential rally in coffee prices. Robusta coffee futures have already soared, dwarfing their counterparts with a 53.7% increase from the previous November.
The rise in Robusta futures is remarkable, charting a path from a November low of $2,179 per ton to a striking high of $3,379 per ton in late January 2024. This ascent underscores the robust demand and favorable market conditions for coffee, more broadly setting the stage for Arabica’s potential upswing.
In tandem, other soft commodities have also experienced explosive moves, with frozen concentrated orange juice (FCOJ) reaching unprecedented heights and cocoa futures advancing past their 1977 peak. These dynamic rallies serve as both indicators and catalysts within the market, suggesting a fertile ground for Arabica futures to flourish.
Furthermore, sugar and cotton prices have shared in this bullish momentum. The upward swing in sugar has been significant, cresting at heights unseen since 2011, while cotton has demonstrated a robust recovery from its 2022 dip.
Arabica coffee futures have demonstrated resilience, with technical resistance levels now in sight. The December 2023 high of $2.0390 per pound, followed by the April peak and the February 2022 pinnacle, are key thresholds that could preface a run towards the illustrious 2011 high.
For market participants, the absence of ETF or ETN products tracking Arabica prices means that futures and options trading on the Intercontinental Exchange remains the principal avenue for investment. The confluence of market trends and the historical precedence of soft commodities boost the prospect of Arab
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