2023-12-21 01:02:02
After two years of deficit, the coffee market should return to surplus thanks to better production. But the market remains fragile due to climatic hazards.
For months, inflation has weighed on the coffee market. Consumption has shifted towards the cheapest coffees, to the detriment of Arabica.
But this pressure from roasters on robusta came at a bad time: the last harvest from Vietnam, the world’s leading producer, did not live up to what was expected. Volumes are down by almost 4 million bags (60 kg) for the production which is currently being marketed. Same scenario for Indonesia and India.
Stocks down, prices up
The hopes which had been placed on the production of Brazil, the other player which counts for world trade, have been damaged by a heat wave which has affected the robusta production zone in recent weeks. As a result, coffee has reached record prices in recent days, the highest since 2008, for certain contracts.
The rise in prices has had a direct impact on stocks: instead of buying coffee, roasters are drawing from their reserves. In one year, European stocks have fallen by more than 30%. And the fact that they have fallen so much has now become a factor in driving up prices.
Difficult forecasts
International prices suggest that there is not enough coffee, summarizes a trader, while in terms of supply, the signals are not alarming. The market should have a surplus of one million tonnes for the coming year, according to the World Coffee Organization (ICO), after two years of deficit.
If the production crisis and the logistics crisis are a priori past, today it is the climate which is playing spoilsport and creating turbulence difficult to anticipate… Hence a fragile and volatile market, summarizes a of our interlocutors.
Also listen Peru: coffee in the face of climate change
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