SAO PAULO, Brazil – Arabica coffee prices fluctuated widely in Brazil in the first half of October, dropping most of the days, says Cepea in its latest report. Rains improved crops conditions and triggered a large blooming, raising expectations for higher production and pressing down quotations.
Besides, the fear of a world recession increased pressure on values. On the other hand, the US dollar and the technical recovery of international prices raised values in Brazil on some other days.
Thus, many agents stayed away from the national spot market, keeping liquidity low in the first fortnight of the month.
On October 14th, the CEPEA/ESALQ Index for arabica coffee type 6, delivered to São Paulo city, closed at BRL 1,154.73 (USD 216.73)/bag, a steep 10.26% down from that on September 30th.
Abroad, although lower stocks have been a concern, agents are aware of both the rains in the coffee-producing regions in Brazil and the possibility of a good harvest in the 2023/24 season.
Crops
Frequent rains in the first fortnight of October brought some relief to most coffee farmers in Brazil. Cepea collaborators reported that, in some areas, a major blooming has been observed already, and fruitlets are currently being formed, mainly in northwestern Paraná.
On the other hand, some farmers have been concerned about the results of the dry weather from the last months and the strong winds in some locations. It is important to highlight that the low number of leaves on trees may compromise flower set and the development of the crop.
Robusta
Robusta coffee prices dropped in Brazil in the first half of the month too. On Oct. 14th, the CEPEA/ESALQ Index (Espírito Santo) for the robusta coffee type 6, screen 13, closed at BRL 656.58 (USD 123.23)/bag, a steep 11% down from that on Sept. 30th.
As for the weather, in Espírito Santo, low rainfall is still a concern in some areas. Lower rains and strong winds led leaves to fall off, damaging crops. Although blooming has been spotted in some regions, agents expected a larger blooming to occur. In Rondônia, on the other hand, the scenario is slightly better, since high rains and a large blooming have brought some relief to farmers.
