coffee prices

Coffee prices fall again in January after two-month rise

According to the International Coffee Organization (ICO) January 2020 Coffee Market Report, coffee prices fell again in January following a two-month rise.

The ICO composite indicator reversed its gains from December 2019, averaging 106.89 US cents per pound. The daily price of the ICO composite ranged between 99.78 US cents per pound on 29 January and 115.18 US cents per pound on 2 January.

The ICO says the 2020/21 Brazilian crop, which would be an on-year of its biennial Arabica cycle, and broader macroeconomic uncertainty exerted negative pressure on the market.

Prices for all group indicators fell in January 2020. Brazilian Naturals saw the largest decrease, of 12.4 per cent, to 110.73 US cents per pound. Other Milds fell by 9.5 per cent to 142.19 US cents per pound, while Colombian Milds decreased 8.7 per cent to 147.52 US cents per pound.

As a result, the differential between Colombian Milds and Other Milds widened in January 2020, rising by 21.4 per cent to 5.33 US cents per pound. Prices for Robusta decreased by 3.7 per cent month-on-month to 70.55 US cents per pound, partly in response to increased shipments of Robusta from Vietnam and Indonesia.

Global exports in December 2019 totalled 10.3 million bags, compared with 10.27 million bags in December 2018.

Across the first three months of coffee year 2019/20, exports decreased by 5.8 per cent to 29.01 million bags compared to 30.78 million bags in 2018/19. During this period, shipments of Arabica fell 10.1 per cent to 18.28 million bags, but Robusta increased by 2.7 per cent to 10.73 million bags.

The decline in Arabica exports was driven largely by a fall in shipments of Other Milds and Brazilian Naturals, of 13.8 per cent to 4.22 million bags and of 13.3 per cent to 9.95 million bags, respectively. However, exports of Colombian Milds rose by 3.7 per cent to 4.12 million bags.

While global production is expected to fall by 0.9 per cent to 168.71 million bags, total consumption is projected at 169.34 million bags in 2019/20. This would result in a projected deficit of 0.63 million bags for 2019/20.

For more information, visit www.ico.org