Rabobank lowers global coffee crop forecast 23/24

NEW YORK (Reuters) - Global coffee production is likely to be lower than expected in the 2023/24 season, which starts in October and ends in September next year, but a drop in demand -- particularly in Europe -- will prevent a supply deficit, Rabobank Research said in a note on Tuesday.

The Dutch bank, which has a strong presence in agricultural finance, projected global coffee production in 2023/24 at 172.6 million bags, down 1.6 million bags from its previous forecast, due to revisions to low, mainly from production in Colombia and Vietnam.

Colombia's crop was reduced from 13.6 million bags to 12.5 million bags, and Vietnam's was reduced to 29 million bags, half a million bags less than expected. Both countries are dealing with less-than-ideal weather.

Rabobank, however, maintained its estimate of a balanced global supply in 2023/24, citing falling demand in non-producing countries.

"Import demand figures were very dismal during the second quarter of 2023," the report said, citing a 13.4% year-on-year decline in net imports into the EU plus UK region.

Coffee imports into the United States fell 9.6% in the second quarter from a year earlier, the bank said, adding that the drop in coffee imports was the biggest since it began compiling this type of data in 2008.

The report also noted that coffee prices are falling in the US due to competition, pressure from retailers and concerns about low consumer sentiment.

(Reporting by Marcelo Teixeira)

Source: Reuters / Via Noticias Agrícolas