MILAN – Coffee futures prices closed lower for the third straight day on Wednesday. Ice Arabica contract for September delivery fell 35 points to 148.90 cents per lb, the lowest level for the New York market in almost 7 months. In London, the most traded contract for November delivery lost $55 to close at 4-month low of $2378.
Favourable weather in Brazil has accelerated the country’s coffee harvest, boosting supplies and speeding up sales.
SAFRAS monthly survey pointed to a commitment by growers of 41% of the potential of Brazil’s 2023 crop through August 8. This percentage involves, besides the physical sale, also barter operations, locks with trading companies, and rollovers from the past crop.
Even with good progress compared to the previous month, the flow of sales remains below the same period last year, when it reached 45% of the expected production, and below the 5-year average for the period, which is around 46%.
The weekly monitoring of SAFRAS indicates that until August 8, the country had reaped 86% of the 23/24 crop, which corresponds to an increase of 6% over the previous week.
Even so, work continues below the same period last year, when the harvest reached 89% of production, and below the five-year average, which corresponds to 90% of production.
Brazil’s Cooxupe, the country’s biggest coffee cooperative, said on Wednesday the 2023 harvest in the areas where it operates had reached 81.9% of the fields by Aug. 11.
Brazil exported 2,991,495 bags of all forms of coffee, up almost 19% on year-
Robusta futures prices will record an annual 28% increase, according to the newest Reuters poll of 10 traders and analysts. Prices are expected to settle around $2,300 per metric ton at the end of 2023, below the current price levels, but 28% above levels at the end of last year, considering the poll’s median forecast.
Arabica coffee prices are seen at the end of the year at $1.53 per lb, 8% below levels at the end of 2022, the poll also showed.
Poll participants said that the combination of an expected increase in Brazilian output in the 2024/25 season and weak global demand could exert further downward pressure on Arabica prices.
Brazil’s coffee production in 2024/25 is expected to climb to 69.8 million bags, the median forecast showed, with several participants predicting more than 70 million bags.
The median forecast for the 2023/24 crop was 67.3 million bags, concluded Reuters.
