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Coffee Report Focus #4: GCA Stocks

After last month's surprise GCA stocks report, many of us in the #coffee industry were watching closely this week's report, because the implications on price could be huge.


What we saw was on the surface a relatively ho-hum number, but I would contend it was actually fairly #bearish.


In the article that follows I explain how I interpret this report generally, and why this week's report was bearish for price.


To explain the GCA stocks number from Friday, we will first look at why we follow them, then we will look at how we should read the reports, then we will conclude with some thoughts on Friday's number.


Why should we care?

First and foremost because #stocks influence #price. One of the most fundamental premises for #commodity #traders is that stocks and price are inversely related. In the graphic below showing the relationship between certified stocks and price we can see very clearly the inverse relationship (more on how that relationship has changed here).