MILAN – Coffee futures markets ended the week at the turn of the year on the low side. In New York, the front month (March) lost 820 points (-2.5%) closing at 318.65 cents. In London, the main coffee futures contract (March) fell, in turn, by $88 (-1.7%) to settle at $4,968. The markets were dragged lower by better weather developments in Brazil, where heavy rains are helping to replenish soil moisture and improve crop conditions.
Higher prices in international markets are pushing the value of India’s exports to new records.
According to data released last week by the Centre for Monitoring Indian Economy (CMIE), India’s coffee export earnings reached a total of $1.1469 billion in the first eight months of FY 2024-25 (April-November), an increase of 29% over the same period of the previous FY.
This is close to the full FY 2023-24 turnover of $1.28 billion, which was in turn 12% higher than in 2022-23.
India’s top export markets include Italy, Turkey, the United Arab Emirates and the Russian Federation. The country continues to struggle with climate issues, particularly drought, which cut output by nearly half in some regions.
Beyond weather, the Indian coffee industry is also facing global geopolitical and logistical challenges.
Meanwhile, the harvest season has begun in Central America and Mexico. According to a report by Sucafina, the 2024/25 harvest was delayed due to late flowering as well as the influence of Tropical Storm Sara, which brought abundant rains in November.
The Swiss coffee merchant expects the flow of coffee to peak between January and February, followed by a drop in March and ending in April.
Compared to the previous harvest, 2024/25 crop is expected to be 1% lower in the region, with Honduras and Guatemala experiencing larger reductions.
The total combined crop for all Central America and Mexico is projected to reach just 17m bags, marking a new nine-year low.
These reductions are primarily due to the drought that affected the first half of 2024, which impacted flowering in key areas in Honduras and Guatemala. However, there are optimistic projections in Mexico, as well for Nicaragua and Costa Rica.
Sucafina’a Research Manager of the Americas, Oscar Fernando, reports that the quality is expected to be better, due to low reports Coffee Berry Borer and Coffee Leaf Rust. Additionally, there were favourable rains since the second half of June that contributed to good cherry development.
