SÃO PAULO, Brazil – In the season (from July/21 to June/22), the CEPEA/ESALQ Index for Arabica coffee type 6, delivered to São Paulo city, averaged BRL 1,325.65 per 60-kilo-bag, upping 522.90 Reais/bag (or +65.14%) in relation to the crop before, in real terms (IGP-DI May/22). It is also the highest average since 1997/98, reports Cepea in its latest analysis.
Prices rose steeply at the beginning of the 2021/22 season, influenced by frosts in Mogiana (SP), Cerrado and Sul Mineiro. It is worth mentioning that arabica quotations were already in an upward trend in that moment because of the 2021/22 lower production, due to the negative biennial cycle and the dry weather in 2021.
Conab data released in May/22 indicated that the 2022/23 production may total 53.4 million bags, 12% more than in 2021/22, but still the worst performance for a positive biennial cycle since 2016/17.
The USDA, in turn, indicated in June/22 that the Brazilian production may amount 64.3 million tons. Up to the last week of June, from 25% to 35% of the arabica crop had been harvested.
Logistical problems have also influenced price rises. Players say that high freight values and the lack of containers in ships have been delaying or even canceling exports around the world. This scenario, in turn, has led to the use of certified stocks in some importing/demanding countries.
CEPEA/ESALQ Index for Robusta prices
From July/21 to June/22, the CEPEA/ESALQ Index for the Robusta type 6, screen 13, Espírito Santo, averaged BRL 792.95 BRL per 60-kilo bag, for an increase of 273.78 Reais per bag (or +52.7%) compared to the end of 2020/21, in real terms (IGP-DI May/22). This is the highest real average of Cepea series for the Index, which started in 2001.
Price rises in 2021 were attributed to the low arabica supply, which boosted the demand for robusta from roasters around the globe. Moreover, logistical problems and the delay of the harvesting in Vietnam, because of heavy rains, underpinned quotes.
In 2022, values resumed moving down due to the possible high supply in 2022/23. The USDA indicated a production at 16.6 million 60-kilo bags in June/22, while Conab said in May/22 that the harvest may amount 12.16 million bags in 2022/23.
