SOUTH AMERICA – The world coffee supply is set to tighten as production from the major coffee producers in the world falls due to unfavorable weather conditions.
According to the United States Department of Agriculture (USDA), adverse weather conditions have notably affected the production outcome for Brazil which accounts for 30% of the global coffee supply.
In a recent report, USDA noted that persistent drought and high temperatures in major coffee growing regions in the second semester of 2020 and below-average rainfall volumes up to September 2021 have dampened Brazil’s hope for a bumper harvest.
USDA’s Agricultural Trade Office (ATO) in Sao Paulo now estimates Brazilian coffee production for Marketing Year (MY) 2021/22 (July-June) at 56.3 million 60-kg bags, a significant decrease of 19 percent compared to last year’s record output of 69.9 million bags.
La Niña impacts production in Columbia
In Columbia, it is heavy rains from the La Niña weather phenomena that is affectng production.
As a result, USDA’s foreign agricultural service in Bogota has revised the Colombian coffee production forecast down to 13.8 million bags (1 bag = 60 kilograms) green bean equivalent (GBE).
Additionally, disruptions in supply chains in May and June due to the 45-day national protest have also contributed to the fall in yields resulting in lower production.
Low yields in Indonesia affect production
In Indonesia, production is expected to fall on lower Arabica yields in northern Sumatera and lower Robusta yields in the highland areas of southern Sumatera.
Post forecasts 2021/22 Arabica production at 1.28 million bags, 20,000 fewer bags than in 2020/21, on unfavorable weather during the flowering stage.
Robusta yields in Indonesia’s Sumatra region were very low due to it being an offcrop year (characterized by light yields), in contrast to last year’s on-crop heavy yields.
Post notes that higher yields in lowland Robusta production areas such as central Java were not enough to offset the yield reduction in southern Sumatera’s highland areas leading.
Estimates 2021/22 Robusta production are as a result forecasted at 9.3 million bags, 100,000 fewer than the previous year.
India’s coffee impacted by unseasonal rains
Unseasonal rains in November are expected to negatively impact India’s Arabica crop yields and delay the harvest by at least two weeks.
Post however notes that these declines will be offset by higher yields of Robusta leading to a six percent increase in n overall coffee yields.
Production for marketing year (MY) 2021/22 is now estimated at (Oct/Sep) at 5.53 million 60-kilogram bags.
More specifically, Arabica production is estimated at 1.28 million 60- kilogram bags or 76,800 metric tons (MT) while Robusta production is estimated at 4.25 million 60- kilogram bags (255,000 MT).
Improved weather creates prospects for Vietnam
Vietnam is among the few countries that have prospects of a good market year as improved weather conditions support yields.
Using the good weather as an indicator, Post has revised the Vietnam MY21/22 coffee production forecast up to 31.1 million bags, green bean equivalent (GBE), a 7 percent year-over-year increase.
Robusta output accounts for 96 percent of the total coffee production, and is currently estimated at 30 million bags.
Arabica production dropped significantly in MY20/21 but rebounded strongly in MY21/22 to 1.1 million bags on high yields, close to their MY19/20 level.
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