Global Coffee Shortage Drives Prices in Domestic and International Markets

The analysis of the global coffee stock situation, as highlighted by the Carvalhaes Office, reveals a growing imbalance between supply and demand, exacerbated by increasing consumption. Despite a significant rise in ICE-certified stocks in New York compared to the previous year, analyst Eduardo Carvalhaes indicates that these levels remain insufficient. The ongoing lack of replenishment in global stocks suggests continued upward pressure on prices, as current supplies cannot keep pace with the rising demand for coffee. This directly reflects the higher prices observed for both Arabica and Robusta coffee.

In the futures market, Arabica coffee contracts on the New York Stock Exchange maintained their upward trajectory, with the December 2024 contract reaching 250.05 cents/lbp. This demonstrates the market’s immediate response to the perception of limited supply, with investors speculating on the continuation of this trend. Robusta also showed increases, though to a lesser extent, with the November 2024 contract closing at $4,865/ton. While Robusta is less affected by quality concerns, its upward trend reflects the global shortage and climatic concerns in producing regions.

In the Brazilian domestic market, prices followed the global upward trend, especially in key Arabica-producing regions. Prices for Arabica Type 6 in cities such as Machado/MG and Franca/SP showed significant increases, indicating that global dynamics are directly affecting local producers. The Cereja Descascado coffee also saw gains, though more modest. These internal price increases highlight the impact of global conditions on Brazil, the largest coffee producer, where the anticipation of new harvests and insufficient stock levels in the international market keep prices elevated.

Source: Notícias Agrícolas