Brazilian Coffee Monthly Update: May 2021

Our latest update about the Brazilian coffee industry. Read about exports, prices, weather, stocks, and crops.

- Brazil exported 3.3m bags in April 2021, 13% lower than the previous month. However, from January to April 2021, exports reached 14.8m bags, 8.6% higher compared to the same period in 2020. Due to good performance, Brazil has increased its participation at ICE arabica certified stocks, being responsible for 53%, or 1.1m bags (on May 12), of total inventory. Looking ahead, there are concerns about container availability. Combined with the lower Brazilian 2021/22 crop, this may have a negative impact on coffee exports in 2H 2021.
- At the end of April 2021, the spot barter ratio reached 2.83 bags/metric ton, 15.7% lower compared to the previous month. However, it represents a worsening of 7.1% YOY, when the index reached 2.64 bags/metric ton. Despite the recent recovery in coffee prices, fertilizer costs have increased.
- In April 2021, local coffee prices rose to an average of BRL 744/bag (60kg) – a new record and an increase of 27.3% YOY. Coffee prices are around BRL 807/bag in May 2021. In the coming weeks, uncertainties about demand, Colombian exports (due to the local protests), the weather in Brazil, and the high availability of Brazilian 2020/21 coffees should keep the market volatile.
- Rainfall in April was below average in most coffee regions. Cumulative rainfall for the 2021/22 crop is below the historical average in five of eight regions. The situation is worse in Guaxupé (South of Minas Gerais state) and Franca (São Paulo state), where the cumulative rainfall is 26% and 30.5% below normal, respectively. Rabobank projects the 2021/22 crop at 56.2m bags, of which 36m bags are arabica (26.5% lower than 2020/21). The harvest (arabica and robusta) is expected to accelerate in May.