Colombia coffee export hopes rise - as Brazil's fade

23.11.2016

US officials upped expectations for coffee exports from Colombia, the third biggest producing country, but cut their estimate for top-ranked Brazil, as they cut their estimate for robusta bean output to an 11-year low.

US Department of Agriculture foreign staff lifted by 450,000 bags to a 24-year high of 12.84m bags their estimate for Colombia's exports in 2016-17.

The upgrade reflected "the recovery in coffee production" in the South American country, as trees replanted after a rust epidemic mature, with the output estimate for the season upped by 700,000 bags to 14.0m bags.

The lower risk of a La Nina weather pattern, and injurious weather, in late 2016 and early 2017 was also cited.

However, the USDA staff also flagged support to trade from efforts to promote shipments of higher quality beans.

"Colombian specialty coffee is booming with certified and organic coffees receiving significant price premiums, typically higher than traditional coffee exports.

"Value added, specialty coffee now comprises close to 40% of Colombia's total coffee exports."

'Significantly down'

By contrast, USDA officials cut by 1.0m bags to 34.23m bags their forecast for coffee exports by top Brazil in 2016-17.

While the estimate for Brazil's arabica coffee production was revised up, the robusta harvest was downgraded by 1.6m bags to 10.5m bags, the lowest since 2005-06.

"Robusta production is significantly down for the second consecutive year as a consequence of a persistent water deficit, especially in the state of Espirito Santo," the bureau said.

Export prospects

Decreased Brazilian coffee export hopes are "mainly because of the low robusta production", said Shweta Upadhyaya, analyst at Global Coffee Monitor, Agrimoney.com's sister publication.

Robusta exports have plummeted nearly 90% since the start of the 2016-17 season, Brazilian export data showed, in what is usually the peak period for exports.

"We believe exports will remain below last year's due to the combination of lower output, weak beginning stocks and strong domestic demand," said Ms Upadhyaya.

Global Coffee Monitor said Brazil producers will be more conservative sellers this season, as they maintain an eye over stocks.

The shortfall in robusta supplies briefly pushed prices for the variety above that of arabica this season, encouraging higher domestic arabica consumption in Brazil.


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