COMMODITIES HELD BY BROKER:

9 Months Ended

Jul. 31, 2023

Broker-Dealer [Abstract]

COMMODITIES HELD BY BROKER:

NOTE 4 - COMMODITIES HELD BY BROKER:

The Company has used, and intends to continue to use in a limited capacity, short-term coffee futures and options contracts primarily for the purpose of partially hedging and minimizing the effects of changing green coffee prices and to reduce cost of sales. The commodities held by broker represent the market value of the Company’s trading account, which consists of options and futures contracts for coffee held with a brokerage firm. The Company uses options and futures contracts, which are not designated or qualifying as hedging instruments, to partially hedge the effects of fluctuations in the price of green coffee beans. Options and futures contracts are recognized at fair value in the condensed consolidated financial statements with current recognition of gains and losses on such positions. The Company’s accounting for options and futures contracts may increase earnings volatility in any particular period. We record all open contract positions on our consolidated balance sheets at fair value in the due from and due to broker line items and typically do not offset these assets and liabilities.

The Company classifies its options and futures contracts as trading securities, and accordingly, unrealized holding gains and losses are included in earnings and not reflected as a net amount as a separate component of stockholders’ equity.

The Company recorded realized and unrealized gains and losses respectively, on these contracts as follows:

	Three Months Ended July 31,
	2023			2022
Gross realized gains	$	265,801		$	635,570
Gross realized losses		(236,404	)		-
Unrealized losses		(159,955	)		(150,687	)
Total	$	(130,558	)	$	484,883

	Nine Months Ended July 31,
	2023			2022
Gross realized gains	$	642,709		$	1,958,618
Gross realized losses		(1,528,765	)		(1,257,359	)
Unrealized gain (losses)		776,521			(38,241	)
Total	$	(109,535	)	$	663,018

COFFEE HOLDING CO., INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

JULY 31, 2023

(UNAUDITED)