Record Gains in Coffee Market Due to Supply and Climate Concerns

The appreciation of arabica and robusta coffee in international markets on Tuesday (9) was driven by ongoing concerns about global supply. In New York, arabica saw its largest jump in over two years, while robusta in London recorded its biggest increase in 16 years. In Brazil, although the harvest is proceeding without major issues, uncertainty about production size and lower screen size worries producers, keeping prices high.

Favorable weather conditions for the harvest contrast with water deficits in key producing regions, and a potential La Niña in the second half of 2024 adds to concerns. In Vietnam, tight supply and an 11% drop in exports continue to influence global prices. Persistent drought in Mexico also affects production, with 80% of coffee crops in the state of Chiapas impacted, prompting producers to seek government aid to maintain their activities.

In Brazil, the physical coffee market mirrored this international appreciation. Regions such as Guaxupé/MG, Machado/MG, and Varginha/MG recorded significant increases, with up to 5.41% for cherry coffee in Varginha. This appreciation allowed Brazilian producers to capitalize and engage in the market more assertively, positively influencing negotiations and sustaining high prices in the national market.

Source: Notícias Agrícolas