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World coffee production for 2020/21 is forecast 9.1 million bags (60 kg) higher than the previous year to a record 176.1 million

25.06.2020 16:45 "Agro Perspectiva" (Kyiv) World coffee production for 2020/21 is forecast 9.1 million bags (60 kilograms) higher than the previous year to a record 176.1 million. Brazil is forecast to

account for most of the gain as its Arabica crop enters the on-year of the biennial production cycle and Robusta reaches record output. World exports are forecast higher, largely on the strength of Brazil. Global ending stocks are expected to jump to a 6-year high as production outpaces consumption.

Coffee prices, as measured by the International Coffee Organization (ICO) monthly composite price index, retreated in the last few months to average $1.04 per pound in May 2020.

Brazils Arabica output is forecast to gain 6.8 million bags above the previous season to 47.8 million. Good weather conditions prevailed in most coffee regions, supporting fruit setting and development and filling, thus resulting in high yields. In addition, the majority of producing areas are in the on-year of the biennial production cycle. The bulk of the Arabica harvest started between May and June and the quality of the crop is expected to be better than the previous harvest.

Robusta production is forecast to gain 1.8 million bags to a record 20.1 million.

Abundant rainfall is expected to boost yields in the three major producing states of Espirito Santo, Rondonia, and Bahia. Also, expansion of clonal seedlings and

improved crop management techniques are expected to aid this years gain. The majority of the Robusta harvest started in April and May. The combined Arabica and Robusta harvest is forecast up 8.6 million bags to a record 67.9 million. Approximately half of the output gain is expected to be exported, with the

remainder stocked.

Vietnams production is forecast at 30.2 million bags, down 1.1 million from last years record harvest.

Cultivated area is forecast unchanged from last year, with over 95 percent of total output remaining as Robusta. The beginning of the rainy season got off to

a dry start, followed by below-average precipitation in many of the major growing areas. February to May are normally dry months and coffee requires irrigation during this period to ensure proper blossom and cherry setting. However, low coffee prices were a disincentive to incur irrigation costs, reducing yields for some

growers. Vietnams Ministry of Agriculture and Rural Development indicated that it will direct policies to maintain coffee area at approximately 600,000 hectares and encourage farmers to switch to other crops where conditions are not favorable for coffee cultivation. Over the last few years, some farmers have begun to plant durian, mango, avocado, and passion fruit trees in their coffee orchards. However, with black pepper prices falling over the last 5 years, farmers are no longer replacing coffee trees with pepper. Bean exports are forecast flat at 24.0 million bags, while inventories are expected to remain elevated.

Colombias Arabica production is forecast up 300,000 bags to 14.1 million on favorable growing conditions and higher yields. Bean exports, mostly to the United States and European Union, are forecast up 400,000 bags to 12.4 million. With consumption also rising, ending stocks are expected slightly lower.

Indonesias output is forecast to slip 400,000 bags to 10.3 million on lower Robusta output. Delayed rains in Southern Sumatra and Java, where approximately 75 percent of the Robusta crop is grown, lowered yields. Arabica production, situated in Northern Sumatra, had favorable growing conditions and is expected to raise output 50,000 bags to 1.3 million. Ending stocks are expected to remain elevated at 2.6 million bags as current prices offer little incentive to draw inventories lower. Bean exports are forecast 200,000 bags lower to 5.9 million.

Indias production is forecast to gain 400,000 bags to 5.3 million as favorable weather during the flowering and fruit set period is expected to improve Arabica and Robusta yields. Bean exports are forecast down 300,000 bags to 3.3 million, while inventories are expected to rise slightly.

Total output for Central America and Mexico is forecast up 600,000 bags to 18.0 million bags. Coffee rust remains in the region and continues to impact output. Honduras is expected to account for nearly all the regions growth, rebounding 500,000 bags to 6.1 million on favorable growing conditions coupled with increased application of fertilizers to boost yields. Honduras accounts for about one-third of the regions output.

Mexico and Guatemala each account for about 20 percent of the regions output and they continue to implement programs to replace trees with rust-resistant varieties. Nicaraguas production is forecast to drop a third consecutive year on lower yields due to coffee rust. The combined bean exports for Central America and Mexico are forecast flat at 14.5 million bags. Over 45 percent of the regions exports are destined for the European Union, followed by about one-third to the United States.

European Union imports are forecast up 2.0 million bags to 49.5 million and account for nearly 45 percent of the worlds coffee bean imports. Top suppliers include Brazil (29 percent), Vietnam (23 percent), Colombia (7 percent), and Honduras (6 percent). Ending stocks are expected to rise 1.0 million

bags to 14.5 million.

The United States imports the second-largest amount of coffee beans and is forecast up 2.0 million bags to 27.0 million. Top suppliers include Brazil (24 percent), Colombia (22 percent), Vietnam (16 percent), and Honduras (6 percent). Ending stocks are forecast to grow 500,000 bags to 7.0 million.

Agro Perspectiva

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