COFFEE GLOBAL MARKET WEEKLY UPDATES
- Indian Filter Coffee Takes Global Spotlight: Indian ‘filter coffee’ secures the second position in TasteAtlas’ esteemed ‘Top 38 Coffees In The World’ list, highlighting its growing recognition on the global stage. The list ranks Cuban espresso as the top coffee, with South Indian coffee following closely behind.
- Rising Coffee Consumption in India: Between 2023 and 2024, India’s coffee consumption exceeded one million 60-kg bags, reflecting a significant increase in demand. Despite being a small fraction of global consumption, India’s coffee market is experiencing steady growth, driven by factors such as urbanization and changing consumer preferences.
- India’s Growing Coffee Production: India’s coffee production continues to rise, with an estimated output of over 393 thousand metric tonnes in fiscal year 2023. Karnataka and Kerala are the leading coffee-producing states, contributing to around 90% of India’s coffee production. The rise of specialty coffee brands like Araku Coffee, known for its unique aromatic profile, further enhances India’s reputation as a coffee-producing nation.
- Transforming the Coffee Industry: A Comprehensive Approach to Fairness and Sustainability in Latin America
- Climate Change Threatens Coffee Production in El Salvador : Salvadoran coffee production is under threat from the effects of climate change, as highlighted in a report by the Inter-American Development Bank (IDB). The report underscores the urgent need for adaptation measures to mitigate the impact of climate change on coffee farms in El Salvador.
- According to the IDB, 83% of coffee farms in El Salvador require adaptation measures due to climate change, particularly those located at altitudes lower than 800 meters above sea level. This vulnerability exposes coffee growers to various challenges, including pests, droughts, excessive rainfall, and the spread of lethal fungi such as rust.
- Nespresso to Invest $20 Million in Reviving Coffee Production in the Democratic Republic of Congo
- Brazilian Real Weakness: Arabica coffee prices were undercut by weakness in the Brazilian real, which dropped to a 1-week low against the dollar. The devaluation of the real encourages export selling from Brazil’s coffee producers, contributing to the decline in prices.
- Increased Vietnam Exports: Robusta coffee prices retreated after Vietnam’s agriculture ministry reported a significant increase in Q1 coffee exports, rising by 44% year-on-year to 799,000 metric tons. This surge in exports from Vietnam, the world’s largest producer of robusta coffee beans, adds pressure on prices.
- Supply Concerns: Earlier in the week, coffee prices rose to highs driven by concerns over supply shortages. Vietnam’s coffee production is forecasted to drop by 20% due to drought, contributing to tight robusta coffee supplies. Additionally, above-average rain in Brazil eased previous concerns of dryness, further influencing market sentiment.
- Global Coffee Exports: The International Coffee Organization (ICO) reported an increase in global coffee exports, with January exports rising by 32.3% year-on-year to 12.62 million bags. However, concerns persist over the impact of the El Nino weather event on coffee production in various regions.
- Brazil, the world’s largest grower and exporter of coffee beans, is poised to achieve a rare feat: its third consecutive year of increased coffee production. This trend, attributed to post-frost farming techniques and a surge in robusta bean cultivation, marks a significant departure from the traditional arabica biennial cycle.
- Production Growth: Brazil’s robusta fields have seen a remarkable increase in average yields, growing by approximately 50% over the past decade. In contrast, arabica yields have risen by 24% during the same period.
- Production Estimates: Brazil’s National Supply Company (Conab) projects the 2024 crop at 58 million bags, representing a 5% increase from the previous year. Cumulatively, Brazil’s coffee production is estimated to reach 164 million bags over the three-year period from 2022 to 2024.
- Climate Change Threatens Colombian Coffee Production : Coffee production in the Sierra Nevada region has declined by 35% over the past five years, according to the Latin American and Caribbean Fairtrade Network (CLAC).
- Vietnamese Export Projections: The Vietnam Coffee Association forecasted a substantial decrease of 20% in Vietnam’s 2023/24 coffee exports, citing dry weather conditions that have led to reduced yields and production.
- Global Production and Consumption: The International Coffee Organization (ICO) projected a surplus in global coffee production for the 2023/24 season, driven by increased output. However, the USDA’s Foreign Agriculture Service (FAS) forecasts a decline in robusta production and ending stocks.
- Domestic coffee prices in Vietnam have skyrocketed in the first months of 2024, reaching around VNĐ95,000 per kilo, more than double compared to the same period in 2023. While this is beneficial for farmers, it poses significant challenges for export businesses.
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