The Colombian Milds and Other Milds decreased by 0.8% and 0.6%, reaching 277.10 and 276.82 US cents/lb, respectively, in October 2024. The Brazilian Naturals also depreciated, decreasing by 0.5% to 255.85 US cents/lb in October 2024. The Robustas contracted 8.3% to 221.93 US cents/lb. The New York and London ICE markets were drivers of the contraction, decreasing by 1.3% and 8.2% and reaching 250.62 and 207.11 US cents/lb, respectively.

On 2 October, a press release was published saying that the European Commission “strengthens support for EU Deforestation Regulation implementation and proposes extra 12 months of phasing-in time, responding to calls by global partners.” The news had a bearish impact on the I-CIP, with a market reaction driving the price to 245.29 US cents/lb by 7 October from 263.96 US cents/lb on 1 October. On 16 October, the Council agreed on its position on the targeted amendment of the EU Deforestation Regulation, postponing its date of application by 12 months. As a result, if agreed by the European Parliament, the obligations stemming from this regulation will be binding from 30 December 2025 for large operators and traders and from 30 June 2026 for micro- and small enterprises. The news of the agreement by the Council appears to have further added to the downward momentum of the I-CIP, which steadily fell throughout the remainder of the month, closing October at 242.25 US cents/lb. The Brazilian Real was an additional downward factor on the I-CIP, which reached a 3.5 year low against the dollar at 5.81 BRL to 1 USD on 31 October.

The Colombian Milds–Other Milds differential shrank from 0.75 to 0.28 US cents/lb between September and October 2024. The Colombian Milds–Brazilian Naturals differential contracted by 3.5% to 21.25 US cents/lb, whilst the Colombian Milds–Robustas differential expanded by 48.3% from September to October 2024, averaging 55.17 US cents/lb. Meanwhile, the Other Milds– Brazilian Naturals and Other Milds–Robustas differentials moved by -1.5% and 50.6% to 20.97 and 54.89 US cents/lb, respectively. The Brazilian Naturals–Robustas differential grew by 123.6%, averaging 33.92 US cents/lb in October 2024.

The arbitrage, as measured between the London and New York futures markets, expanded 54.2% to 43.50 US cents/lb in October 2024, marking its highest point in four months. This trend reversal could signal how the market is reacting to longer term higher Robusta prices, where the downward adjustment of the Robustas seems to be stronger in relation to the Arabicas, reflecting that the Robustas may have been overvalued. Furthermore, in September 2024, the Robustas grew month-on-month at a much faster rate than the Arabicas – 12.8% versus 6.2% – thereby permitting a more aggressive downward adjustment.

The intra-day volatility of the I-CIP expanded by 0.5 percentage points, averaging 11.0% in October 2024. The Colombian Milds’ volatility increased by 0.6 percentage points. The Other Milds’ volatility grew by 0.4 percentage points to 11.4% while the Brazilian Naturals followed the same uptrend, gaining 0.7 percentage points and averaging 12.1% in October 2024. The Robustas’ volatility contracted to 11.2% for the month of October, a 0.1 percentage point decrease. Lastly, New York’s volatility increased by 0.5 percentage points to 12.7% while the London futures market’s volatility also increased by 1.0 percentage points to 13.6%.

Exports by Coffee Groups – Green Beans
Global green bean exports in September 2024 totalled 9.69 million bags, as compared with 7.74 million bags in the same month of the previous year, up 25.2%. For coffee year 2023/24, exports of green beans were up 11.8% to 123.75 million bags from 110.72 million bags in coffee year 2022/23, an absolute increase of 13.02 million bags. This is the biggest annual increase on record, surpassing the previous highest of 9.27 million bags in coffee year 1995/96. The rate and the volume of increase in coffee year 2023/24 are largely a reflection of the base effect of two consecutive years of downturn (of 1.1% and 5.6%), with the world green bean exports falling from 118.66 million bags in coffee year 2020/21 to 110.72 million bags in coffee year 2022/23. As such, the double-digit increase in coffee year 2023/24 represents a recovery, and not necessarily an expansion, of the long-term trend. Contextualizing, world exports of green beans have been increasing at an average of 2.36 million bags every coffee year between coffee years 2010/11 and 2020/21, while there was an increase of only 1.69 million bags annually between coffee years 2020/21 and 2023/24. The actual exports level is below the potential level of 125.73 million bags.

Shipments of the Other Milds increased by 22.9% in September 2024 to 1.92 million bags from 1.56 million bags in the same period last year. For coffee year 2023/24, exports of the Other Milds were up 4.7% to 23.05 million bags from 22.02 million bags in coffee year 2022/23.

Green bean exports of the Brazilian Naturals increased in September 2024, jumping by 37.3% to 3.68 million bags. For coffee year 2023/24, exports of the Brazilian Naturals were up 22.6% to 41.89 million bags from 34.16 million bags in coffee year 2022/23.

Exports of the Colombian Milds increased by 22.3% to 0.99 million bags in September 2024 from 0.81 million bags in September 2023. For coffee year 2023/24, exports of the Colombian Milds were up 14.3% to 12.22 million bags from 10.69 million bags in coffee year 2022/23. For coffee year 2023/24, total green beans exports of Arabicas were up 15.47% to 77.17 million bags from 66.68 million bags in coffee year 2022/23.

Overall, for the Arabicas, the double-digit growth in coffee year 2023/24 should, like the total green bean exports, be viewed as recovery back onto the long-term trend. Like the total exports, exports of the Arabicas in coffee year 2023/24 followed two consecutive years of negative growth (3.1% and 10.4%) before recording the biggest absolute annual increase on record at 10.29 million bags. Contextualizing, exports of the Arabicas have been increasing at an average of 1.45 million bags every year between coffee years 2010/11 and 2020/21. The potential level of exports is 81.38 million bags.

Green bean exports of the Robustas were up 15.4% to 3.1 million bags in September 2024 from 3.59 million bags in September 2023. For coffee year 2023/24, exports of the Robustas were up 6.2% to 46.58 million bags from 43.84 million bags in coffee year 2022/23. It is the biggest annual exports on record and was largely driven by Brazil, which exported 9.02 million bags as compared with 2.84 million bags in coffee year 2022/23. The growth in Brazil’s exports more than compensated the large drop in exports from Vietnam, which shipped 23.19 million bags in coffee year 2023/24 as compared with 26.13 million bags in coffee year 2022/23. The origin, the world’s largest producer and exporter of Robustas, has been struggling with domestic supplies, with production falling below the potential levels due to adverse weather conditions.

For coffee year 2023/24, the Arabicas’ share of total green bean exports increased to 62.4% as compared with 60.4% in coffee year 2022/23.

Exports by Regions – All Forms of Coffee
In September 2024, South America’s exports of all forms of coffee increased by 30.8% to 6.2 million bags. For coffee year 2023/24, exports of the region were up 30.7% to 66.13 million bags from 50.59 million bags in coffee year 2022/23. The region’s two largest producers and exporters, Brazil and Colombia, saw their total exports jump by 34.3% and 13.7%, respectively, to 49.03 million bags and 11.91 million bags. For Brazil, these are the largest exports on record. Part of the impetus for Brazil’s growth was the gap in the market created by Vietnam in the Robustas market. Although it is not widely acknowledged, Brazil is the secondlargest Robustas producer in the world, accounting for 32.0% of global supply in coffee year 2022/23.

Exports of all forms of coffee from Africa increased by 14.3% to 1.37 million bags in September 2024 from 1.2 million bags in September 2023. For coffee year 2023/24, exports from the region were up 17.3% to 16.02 million bags from 13.66 million bags in coffee year 2022/23. Ethiopia was the main driver of the region’s double-digits growth, with the origin’s exports up 63.5% to 5.59 million bags in coffee year 2023/24 as compared with 3.42 million bags in coffee year 2022/23. These are the largest exports on record for the origin, and it is also the first time the 5.0 million bags ceiling has been breached. The underlying reason for Ethiopia’s double-digit growth was the resolution of internal contract disputes, which had led to export shipments being delayed in coffee year 2022/23. Once again, contextualization is necessary when analysing the exports of Ethiopia: exports fell in coffee year 2022/23 by 15.0% to 3.42 million bags from 4.02 million bags in coffee year 2021/22, the lowest level since 3.09 million bags in coffee year 2015/16. As a result, the 5.59 million bags should be viewed as a recovery.

In September 2024, exports of all forms of coffee from Mexico & Central America were up 18.1% to 0.9 million bags as compared with 0.76 million bags in September 2023. For coffee year 2023/24, exports of the region were down 4.1% to 14.51 million bags from 15.13 million bags in coffee year 2022/23. The downturn was primarily driven by Honduras and Nicaragua, which suffered from decreases of 12.1% and 16.5%, respectively. The former’s exports were hampered by its off-years in the biennial production cycle, while the latter’s exports were negatively affected by the bankruptcy of Mercon Coffee Group in December 2023, a coffee trader and the owner of CISA Exportadora, a company responsible for more than half of Nicaragua’s coffee exports. Exports from Guatemala and Mexico were the two main mitigating positive factors of the region, increasing by 8.6% and 8.9% to 3.28 million bags and 2.97 million bags, respectively.

Exports of all forms of coffee from Asia & Oceania increased by 19.6% to 2.29 million bags in September 2024 as compared with 1.91 million bags in September 2023. For coffee year 2023/24, exports of the region were down 6.7% to 40.62 million bags from 43.54 million bags in coffee year 2022/23. Vietnam, the largest producer and exporter in Asia & Oceania, was the main driving force behind the region’s annual downturn, with its exports decreasing by 11.7% to 24.96 million bags. This is the lowest exports level since 22.03 million bags in coffee year 2014/15. Tightness in domestic supply due to lower production from adverse weather conditions and loss of productive areas to other cash crops, and depletion of local stocks, was the main reason for the double-digit downturn. India was a positive mitigating factor within the region, recording a 10.0% increase in its exports to 6.98 million bags in coffee year 2023/24 as compared with 6.34 million bags in coffee year 2022/23.

Exports of Coffee by Forms
Total exports of soluble coffee increased by 24.3% in September 2024 to 1.02 million bags from 0.82 million bags in September 2023. For coffee year 2023/24, soluble coffee exports were up 11.6% to 12.82 million bags from 11.48 million bags in coffee year 2022/23.

Soluble coffee’s share in the total exports of all forms of coffee for the year to date was 9.3% in September 2024, the same for the same period a year ago. Brazil is the largest exporter of soluble coffee, having shipped 0.37 million bags in September 2024 and 3.89 million bags in coffee year 2023/24.

Exports of roasted beans were down 9.2% in September 2024 to 54,544 bags, as compared with 60,040 bags in September 2023. For coffee year 2023/24, roasted coffee exports were down 0.5% to 0.71 million bags from 0.713 million bags in coffee year 2022/23.

For the full report, visit icocoffee.org.

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The I-CIP averaged 258.90 US cents/lb in September, an 8.4% increase from August 2024. The I-CIP posted a median value of 264.57 US cents/lb and fluctuated between 241.20 and 272.70 US cents/lb. The September 2024 I-CIP is above the September 2023 I-CIP by 69.1%, with the 12-month rolling average at 201.71 US cents/lb.

The Colombian Milds and Other Milds increased by 5.9% and 6.5%, reaching 279.27 and 278.52 US cents/lb, respectively, in September 2024. The Brazilian Naturals also appreciated, increasing by 6.2% to 257.24 US cents/lb in September 2024. The Robustas outperformed all groups of coffee, expanding 12.8% to 242.08 US cents/lb. The New York and London ICE markets were drivers of growth, expanding by 6.0% and 13.8% and reaching 253.89 and 225.68 US cents/lb, respectively–the highest point since September 2011 for the Arabica futures, and the highest point since May 1977 for the Robusta futures (nominal prices).

Strong consumer demand continued to apply positive price pressure on the I-CIP as people returned to work in September following the northern hemisphere summer holidays. The rise in climate-related irregularities also contributed to upward pressure on prices via logistical disruptions – Typhoon Yagi not only claimed several lives, but damaged infrastructure and homes through extensive flooding and mudslides. There has been increased disruption to return flows of empty containers as key shipping routes remain susceptible to the effects of geo-political tensions. As attacks from insurgents continue to threaten commercial maritime routes in the Bab al-Mandab Strait, shipping lines continue to re-route their operations through the Cape of Good Hope. Also adding to logistical pressure was the news of a potential strike at the US East Coast ports, first heard over the second half of September. The strike ultimately went ahead on 1 October and ended on 3 October.

The Colombian Milds–Other Milds differential shrank from 2.33 to 0.75 US cents/lb between August and September 2024. The Colombian Milds–Brazilian Naturals differential expanded by 2.1% to 22.03 US cents/lb, whilst the Colombian Milds–Robustas differential declined by 24.2% from August to September 2024, averaging 37.20 US cents/lb. Meanwhile, the Other Milds– Brazilian Naturals and Other Milds–Robustas differentials moved by 10.6% and -22.0% to 21.28 and 36.45 US cents/lb, respectively. The Brazilian Naturals–Robustas differential retracted by 44.9%, averaging 15.17 US cents/lb in September 2024.

The arbitrage, as measured between the London and New York futures markets, contracted 31.8% to 28.21 US cents/lb in September 2024, marking its lowest point since March 2003. The intra-day volatility of the I-CIP retracted by 0.4 percentage points, averaging 10.5% in September 2024. The Colombian Milds’ volatility decreased by 0.1 percentage points. The Other Milds’ volatility grew by 0.2 percentage points to 11.0% whilst the Brazilian Naturals lost 0.1 percentage point, averaging 11.4% in September 2024. The Robustas’ volatility contracted to 11.3% for the month of September, a 0.8 percentage point decrease. Lastly, New York’s volatility increased by 0.1 percentage points, whilst the London futures market’s volatility decreased by 0.9 percentage points to 12.6%.

Exports by Coffee Groups – Green Beans
Global green bean exports in August 2024 totalled 9.91 million bags, as compared with 9.11 million bags in the same month of the previous year, up 8.8%. This is the tenth consecutive month of positive growth, resulting in the cumulative total for coffee year 2023/24 to August 2024 being up 10.5% at 113.81 million bags as compared with 102.99 million bags over the same period a year ago. The Robustas was the main group responsible for the overall strong growth seen in August 2024, accounting for 59.8% of the 0.8-million-bags net gain in total exports.

Exports of the Colombian Milds increased by 26.7% to 1.05 million bags in August 2024 from 0.83 million bags in August 2023. The latest jump in the exports was driven by Colombia, the group’s largest producer and exporter, with its August 2024 exports up 27.9% to 0.95 million bags as compared with 0.75 million bags in August 2023. The cumulative total for the origin is 10.06 million bags, up 16.1% versus the 8.66 million bags exported from October 2022 to August 2023. Exports of the Colombian Milds for the first 11 months of coffee year 2023/24 are up 13.6% at 11.22 million bags, as compared with 9.88 million bags in the first 11 months of coffee year 2022/23.

Shipments of the Other Milds increased by 5.6% in August 2024 to 1.99 million bags from 1.88 million bags in the same period last year. This is the fifth instance of positive growth since the beginning of coffee year 2023/24. The cumulative volume remained up at 2.2% in the first 11 months of said coffee year and is now at 20.91 million bags as compared with 20.46 million bags last coffee year. Ethiopia, Guatemala and Peru were the three main drivers of the region’s 5.6% growth in exports, with a combined net increase of 0.25 million bags, while Honduras continued to be the main driver of negative growth, with a net decrease of 0.14 million bags. Honduras is currently in the “off-year” of its biennial production cycle, and the cumulative total of the origin’s Other Milds to August 2024 is down 12.9% at 4.46 million bags from 5.12 million bags in the same period a year ago, negatively weighing on the overall export performance of the Other Milds.

Green bean exports of the Brazilian Naturals decreased in August 2024, falling by 0.2% to 3.036 million bags from 3.042 million bags in August 2023. The latest growth is the first negative growth rate in the past 11 months for the group. It mainly stems from the change in the dynamics of the group’s largest producer and exporter, Brazil. In August 2024, exports of Brazilian Naturals from Brazil fell by 6.2% following eight consecutive months of double-digit growth, which had averaged 30.1%. The sudden change in the direction of the growth rate of the group and origin is in large part due to a base effect. Exports from Brazil in August 2023 were an anomalous 2.62 million bags, the third-largest August exports in history, up 16.0% over August 2022. Coffee year 2023/24 was an “off-year” for Brazil, and as such the volume of exports in August 2023 was expected to be lower, with historic data suggesting that Brazil would export 2.24 million bags.

However, the knock-on effect of the frost in 2021 turned it into a good “off-year” for Brazil, resulting in a higher-than-expected volume of exports. Furthermore, in August 2024 Brazil faced significant challenges in exports logistics, with 86% of shipments subject to delays and changes in schedules as compared with 60% in August 2023 at the port of Santos, the largest port for coffee exports. The Brazilian Naturals saw only a shallow downturn in August, mainly due to the 64.0% increase in exports from Ethiopia, which had a net gain of 0.16 million bags. For the first 11 months of coffee year 2023/24, green bean exports of the Brazilian Naturals amounted to 38.22 million bags, up 21.4% from 31.49 million bags over the same period a year ago.

Green bean exports of the Robustas were up 14.3% to 3.84 million bags in August 2024 from 3.36 million bags in August 2023. As a result, the growth rate of the cumulative total accelerated, increasing to 5.6% in August 2024 from 4.8% in July 2024, with total shipment at 43.46 million bags as compared with 41.16 million bags in the first 11 months of coffee year 2022/23. The main drivers of August’s double-digit growth rate were Brazil, India and Indonesia, whose combined exports were up 36.2% at 1.66 million bags as compared with 1.22 million bags in August 2023. The three origins accounted for 92.1% of the net gain made by the Robustas in August 2024.

Exports by Regions – All Forms of Coffee
Exports of all forms of coffee from Asia & Oceania increased by 6.2% to 2.93 million bags in August 2024. This is the first positive growth rate in the past four months and it was mainly driven by Indonesia and India. The region’s second- and third-largest producers and exporters saw their respective exports increase by 26.3% and 31.3% to 0.89 million bags and 0.57 million bags as compared with 0.68 million bags and 0.45 million bags in August 2023.

Together the two origins accounted for 82.9% of the region’s 0.17-million-bag net rise. Vietnam, Asia & Oceania’s largest producer and exporter of coffee, saw its exports fall by 12.1% in August 2024 to 1.3 million bags from 1.44 million bags. The latest downturn marked the ninth in total and seventh consecutive decline for Vietnam in coffee year 2023/24, and as a result the country’s cumulative exports up to August 2024 fell to 24.09 million bags from 27.4 million bags between October 2022 and August 2023, down 12.1%. The latest decrease continues to be due to tightness in domestic supply, which is waiting for new supply from the 2024/25 harvest, the start of which is still one month away.

Exports of all forms of coffee from Africa increased by 29.5% to 1.75 million bags in August 2024 from 1.35 million bags in August 2023. As a result, the cumulative total for the first 11 months of coffee year 2023/24 is 14.62 million bags, up 17.3% compared with the 12.46 million bags shipped in coffee year 2022/23. Ethiopia was the main driving force behind the region’s growth in August 2024, with the origin’s exports having increased by 62.4% to 0.6 million bags as compared with 0.37 million bags in August 2023. Ethiopia had accounted for 57.5% of Africa’s August 2024 net rise. Côte d’Ivoire and Uganda were secondary positive drivers of Africa’s double digit growth in August, combining to account for 43.2% of the 0.4-million-bag net rise of the region, increasing by 48.5% and 4.5%, respectively.

In August 2024, South America’s exports of all forms of coffee increased by 8.6% to 5.41 million bags. As a result, the cumulative total of 59.84 million bags for the first 11 months of coffee year 2023/24 is up 30.5% as compared to the 45.85 million bags shipped in coffee year 2022/23. Colombia was the source of the strong positive growth of the region, which saw its exports increase by 13.4% in August 2024 to 1.04 million bags from 0.83 million bags in August 2023. As a result, the origin accounted for 52.9% of South America’s 0.43-million-bag net rise in August 2024. Much of the gains made by Colombia in August were down to the base effect, reflecting the historically low exports in August 2023, when 0.83 million bags were shipped. The average exports in August from 2017 to 2021 were 38.0% higher, at 1.14 million bags. Peru accounted for 31.8% of the net rise of the region, with August 2024 exports at 0.55 million bags, up 30.0%. This brings the cumulative total for Peru for the first 11 months of coffee year 2023/24 to 3.83 million bags from 2.37 million bags in the same period a year ago. Exports from Peru are enjoying the benefits of its on-years in the biennial production cycle.

In August 2024, exports of all forms of coffee from Mexico & Central America were down 28.7% to 0.83 million bags, as compared with 1.16 million in August 2023. As a result, cumulative total exports remain down at −10.3%, having decreased to 12.88 million bags, as compared with 14.36 million bags for the same period a year ago (October 2022 to August 2023). Honduras was, once again, the main negative driver of the region’s exports performance in August 2024. Exports from Honduras continue to be hampered by its off-years in the biennial production cycle, said exports being down 12.9% to 0.25 million bags in August 2024 from 0.39 million bags in August 2023.

Exports of Coffee by Forms
Total exports of soluble coffee increased by 13.3% in August 2024 to 1.22 million bags from 1.08 million bags in August 2023. In the first 11 months of coffee year 2023/24, a total of 11.79 million bags of soluble coffee was exported, representing an increase of 10.6% from the 10.66 million bags exported in the same period during the previous coffee year. Soluble coffee’s share in the total exports of all forms of coffee for the year to date was 9.3% in August 2024, the same as in August 2023. Brazil was the largest exporter of soluble coffee in August 2024, shipping 0.33 million bags.

Exports of roasted beans were down 19.7% in August 2024 to 47,730 bags, as compared with 59,417 bags in August 2023. The cumulative total for coffee year 2023/24 to August 2024 is 0.63 million bags, as compared with 0.65 million bags in the same period a year ago.

For the full ICO September report, visit: icocoffee.org.

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Reducing the burden of data management for green coffee traders, roasters and merchants in Italy, Dimitra’s DDS platform receives, manages, analyses and stores supply chain data for seamless communication with authorities and other supply chain operators. Once a supply chain is fully mapped, Dimitra’s DDS will automatically prepare a Risk Assessment and Due Diligence Report and upon user confirmation upload all required data to the EU Information System, documenting compliance. Dimitra’s DDS platform can act as a stand alone system or be fully integrated into any third party Enterprise Resource Planning (ERP) environment.

Alkaff will employ Dimitra’s tailored DDS platform and engage Dimitra’s leading industry experts to map Alkaff’s expansive supply chain, support Alkaff suppliers in farm-level data acquisition, and analyse the data provided by the suppliers to ensure a transparent, traceable, and EUDR compliant supply chain. Dimitra will integrate fully into Alkaff’s software environment and also deliver traceability data directly to Alkaff’s customer-facing application.

Maurizio Zugna, Dimitra, Italy project manager, said: “For Alkaff, the largest coffee merchant in Italy, to make this decisive step towards EUDR compliance proves once again that Rudi Albert, the company CEO, and his team understand the opportunities that come with the digitalisation of global coffee chains. Dimitra’s platform digitalises the process making compliance that much more achievable.”

Rudi Albert, CEO and founder of Alkaff, said: “At Alkaff we pair our passion for coffee with a dedicated focus on innovation. We are excited to streamline EUDR compliance with Dimitra’s advanced tools and origin experience.”

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The I-CIP averaged 216.89 US cents/lb in April, a 16.4% increase from March 2024. The I-CIP posted a median value of 221.99 US cents/lb, having fluctuated between 193.39 and 235.50 US cents/lb. The April 2024 I-CIP is above the April 2023 I-CIP by 21.5%, with the 12-month rolling average at 172.01 US cents/lb. The I-CIP grew steadily in April 2024, reaching a 13-year high. Following a similar trend, the Robustas price also hit a 45- year high, reaching its highest level since July 1979, when it averaged 195.90 US cents/lb.

In the first half of April 2024, the I-CIP surged 21.8% from 193.39 to 235.50 US cents/lb on the back of heavy rainfall in Minas Gerais, Brazil, which will affect the country’s 2024/25 supply. Vietnam also continues to face supply difficulties on the back of poor harvests in coffee years 2022/23 and 2023/24. On 26 March, Vietnam’s agriculture department projected that its national coffee production in the 2023/24 crop year could drop by –20% to 1.472 million metric tonnes, the lowest in four years, due to drought. This was reflected in the surging domestic Robusta green bean price in the country, which rose to over 132,000 VND/KG by 26 April from an average of 80,000 VND/kg on 15 February 2024 and 61,000 VND/kg in mid-November 2023. The surge was broken on 19 April on the back of three factors: (i) recovery of ICE warehouse stocks; (ii) profit taking on the paper market (the net long position on the ICE’s Europe market retreated by 5,042 lots between 16 and 23 April 2024); and (iii) the strengthening dollar (moving from 5.29 Real to 1 US$ on 16 April to 5.12 Real to 1US$ on 30 April). As a result, the I-CIP fell to 218.10 US cents/lb by 30 April.

The Colombian Milds and Other Milds increased by 15.0% and 14.8%, reaching 241.80 and 239.73 US cents/lb, respectively, in April 2024. The Brazilian Naturals presented the strongest increase amongst all coffee groups, at 17.8%, reaching an average of 218.77 US cents/lb. The Robustas grew by 16.8% to 193.65 US cents/lb in April 2024, the highest level in 45 years. ICE’s London market was also a strong driver of the growth, increasing by 18.5% to 176.04 US cents/lb, whilst the New York Futures market expanded by 18.1% to 217.97 US cents/lb, a 20-month high.

The Colombian Milds–Other Milds differential expanded from 1.41 to 2.07 US cents/lb. The Colombian Milds–Brazilian Naturals differential contracted 6.0% to 23.03 US cents/lb, whilst the Colombian Milds–Robustas differential expanded 8.4% from March to April 2024, averaging 48.14 US cents/lb. Meanwhile, the Other Milds–Brazilian Naturals differential shrank 9.2% reaching 20.96 US cents/lb. However, the Other Milds–Robustas and the Brazilian Naturals– Robustas differentials both expanded 7.1% and 26.1%, averaging 46.07 and 25.11 US cents/lb, respectively, in April 2024.

The downtrend of the Arabica and Robusta arbitrage, as measured between the London and New York Futures markets, is now over two years long, falling from 130.30 US cents/lb in April 2022 to 41.93 US cents/lb in April 2024, i.e. a 67.8% decline. However, measured against March 2024, the arbitrage expanded by 16.3% in April 2024.

Intra-day volatility of the I-CIP increased by 0.9 percentage points to 8.0% between March and April 2024. The Colombian Milds’ and Other Milds’ volatility increased to 8.5% and 8.2%, respectively. Meanwhile, the Brazilian Naturals’ volatility grew by 0.9 percentage points to 9.0% from March to April 2024. The Robustas presented an average volatility of 9.1% for the month of April. The London Futures market’s volatility also increased by 0.3 percentage points to 9.7%. Lastly, the New York futures market’s volatility moved in the same direction to that of London, reaching 9.1%, a 0.5 percentage point increase.

The London certified stocks expanded by 27.4% to 0.63 million 60-kg bags. Certified stocks of Arabica coffee reached 0.64 million 60-kg bags, a 1.7% increase since March 2024.

Exports by coffee groups – green beans

Global green bean exports in March 2024 totalled 11.87 million bags, as compared with 10.85 million bags in the same month of the previous year, up 9.4%. As a result, the cumulative total for coffee year 2023/24 to March is 62.64 million bags, as compared with 56.36 million bags over the same period a year ago, up 11.1%. The Brazilian Naturals and Robustas were the two main groups responsible for the overall strong growth observed in March 2024, together accounting for 91.5% of the 1.02-million-bag net gain in total exports. This further consolidated their already-dominant positions, increasing their combined share of the total exports to 72.5% in March 2024 as compared to 70.8% in March 2023. For the year to date, the combined share is an even higher 73.4%.

Shipments of the Other Milds decreased by 1.6% in March 2024 to 2.19 million bags from 2.22 million bags in the same period last year. As a result, the growth rate of the cumulative volume decreased to 4.2% in the first six months of coffee year 2023/24 to 9.87 million bags, as compared with the 6.0% growth rate in the first five months. In March 2024, 15 of the 29 origins in this coffee group saw their exports fall, with Costa Rica, Guatemala, Laos and Uganda suffering the largest absolute losses. On the opposite side, Ethiopia, Honduras, Papua New Guinea and Peru saw the highest absolute net gains.

Green bean exports of the Brazilian Naturals increased in March 2024, rising by 19.0% to 3.57 million bags from 3.0 million bags in March 2023. For the first six months of coffee year 2023/24, green bean exports of the Brazilian Naturals amounted to 21.36 million bags, up 17.5% from 18.19 million bags over the same period a year ago. The sharp positive growth rate stems from the 16.1% increase in exports of the Brazilian Naturals from Brazil, the biggest producer and exporter of this group of coffee, which rose to 3.07 million bags in March 2024 from 2.64 million bags in March 2023.

Exports of the Colombian Milds increased by 12.8% to 1.07 million bags in March 2024 from 0.95 million bags in March 2023. As a result, exports of the Colombian Milds for the first six months of coffee year 2023/24 are up 11.5% at 6.25 million bags, as compared with 5.6 million bags in the first six months of coffee year 2022/23. The double-digit growths, for both the current month and coffee year to date, are a consequence of the 11.9% weather-driven fall in exports in coffee year 2022/23 and subsequent normalization of supply conditions in Colombia, the largest producer and exporter of the Colombian Milds. For the current month and cumulative total to March 2024, the country’s exports of the Colombian Milds are up 12.4% and 13.1%, respectively.

Green bean exports of the Robustas were up 7.8% to 5.04 million bags in March 2024 from 4.68 million bags in March 2023. The cumulative total for the first six months of coffee year 2023/24 is up 8.9%, at 25.16 million bags, as compared with 23.1 million bags in the first six months of coffee year 2022/23. The main driver of March’s Robustas increase was Brazil, which shipped 0.85 million bags as compared with 0.11 million bags in March 2023, up 686.1%.

Exports by regions – all forms of coffee

Exports of all forms of coffee from Asia & Oceania decreased by 9.7% to 4.54 million bags in March 2024. The two main sources of the near double-digit downturn are Indonesia and Vietnam, which saw their exports fall by 33.5% and 10.2%, respectively, to 0.31 million bags and 3.22 million bags in March 2024. As a result, Indonesia’s exports to date in coffee year 2023/24 are down 21.8% at 3.04 million bags, the lowest level since coffee year 2018/19. The fundamental reason behind the fall is the shortage of local supply due to the poor harvest in coffee year 2023/24, which is estimated at 10.0 million bags as compared with 11.98 million bags in the previous coffee year. Vietnam’s latest performance is mitigated by the unusually high exports seen in March 2023, when the country shipped 3.58 million bags, the second highest March exports on record. To put this into perspective, the March 2024 exports of 3.22 million bags are above the average March volume from 2019 to 2023 (3.12 million bags).

Exports of all forms of coffee from Africa increased by 12.6% to 1.19 million bags in March 2024 from 1.06 million bags in March 2023. As a result, the cumulative total of 6.22 million bags for the first six months of coffee year 2023/24 is up 0.6% as compared with the 6.18 million bags shipped in coffee year 2022/23. Ethiopia was the driving force behind the region’s growth in March 2024, with its own exports having increased by 112.8% to 0.38 million bags from 0.18 million bags in March 2023. The size of the rebound is due to a favourable base effect and a comparative normalization of market circumstances. Contract disputes arising from a mismatch between local purchasing prices and global market prices had previously affected the volume of exports, leading March 2023’s shipment to be the lowest since 2012.

In March 2024, South America’s exports of all forms of coffee increased by 33.1% to 5.49 million bags. As a result, the cumulative total of 33.56 million bags for the first six months of coffee year 2023/24 is up 28.7% as compared with the 26.07 million bags shipped in coffee year 2022/23. The source of the strong positive growth is Brazil, which saw its exports increase by 38.8% in March 2024 to 4.31 million bags. The size of the latest growth of Brazil’s export volume remains a reaction to the 20.2% fall in the March 2023 exports (3.1 million bags). Fundamentally, South America’s and Brazil’s strong export performance reflects Brazil’s good harvests in coffee years 2022/23 and 2023/24, estimated to be up by 8.4% and 9.2%, respectively.

In March 2024, exports of all forms of coffee from Mexico & Central America were down 1.9% to 1.78 million bags, as compared with 1.82 million in March 2023. As a result, the cumulative total exports are down 3.0% from October 2023 to March 2024 at 5.74 million bags, as compared with 5.91 million bags for the same period a year ago.

Exports of coffee by forms

Total exports of soluble coffee decreased by 4.8% in March 2024 to 1.06 million bags from 1.11 million bags in March 2023. In the first six months of coffee year 2023/24, a total of 6.16 million bags of soluble coffee were exported, representing an increase of 4.0% from the 5.92 million bags exported in the same period during the previous coffee year.

Soluble coffee’s share in the total exports of all forms of coffee for the year to date was 8.9% in March 2024, down from 9.5% in the same period a year ago. Brazil is the largest exporter of soluble coffee in March 2024, having shipped 0.35 million bags.

Exports of roasted beans were up 11.5% in March 2024 to 68,467 bags, as compared with 61,396 bags in March 2023. The cumulative total for coffee year 2023/24 to March 2024 was 0.37 million bags, as compared with 0.36 million bags in same period a year ago.

For the full report, visit: icocoffee.org.

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One of the lectures I attended was particularly informative. Jay Kling, independent consultant for Efficiency Coffee, was among the speakers who opened the lecture programme on the first day (12 April) of this year’s SCA Expo, with his talk on ‘Inventory Management Fundamentals for Green Coffee Buyers.’ Kling spoke about the ways in which buyers, particularly roasters, can mitigate issues surrounding product flow and inventory. Using demand protections ensures buyers can accurately purchase green coffee, knowing exactly what and how much of certain beans they need, as well as when to move stock from the warehouse to their own storage ready for roasting. Seasonality needs to be addressed to achieve this, said Kling, as “demand will be stronger in certain times of year,” such as the autumn ‘coffee season’, November-December holiday season, and cold brew season. Data helps forecast seasonality and should be accounted for in demand forecasts, however some discrepancies have to allowed for here as it is dependent on weather and that can often be unseasonal.

Kling’s next stratagem was Safety Stock. He advised that companies should keep extra green coffee stock inventory to decrease chances of running out due to unexpected demand or a supply chain issue. The precise amount kept in surplus will depend per business, Kling explained, and this can be estimated with the following equation: lead time from importer (weeks) x average weekly demand. This also means these figures should be customised per product as they are likely to have different lead times or demand. Kling also added that the following questions should be asked and considered: “How important is the product for your operation? Can I replace a product with another if I run out? And what is the max lead time for receiving the product?”

Inventory reconciliation was the next of the fundamentals, which is essentially manually counting the coffee that you have in store. This is to offset common inventory mistakes such as incorrect data entry eg, bag size, using the wrong coffee, or the wrong coffee sent from the warehouse. Inventory reconciliation keeps on top of this.

It is also essential to be aware of your green coffee storage capacity, said Kling. This constitutes the max amount of coffee that can be stored in a facility while allowing for normal and safe operations. This also has to take into account for shipments and storage of non-coffee products. Having this knowledge optimises movements from the importers warehouse and informs decisions about offering new products.

Kling’s final stratagem was calculating roasting capacity. This can be done using the formula: batch size x number of roasts per hour x hours of roasting per week. Utilising roasting capacity allows you to evaluate how much you are roasting vs how much you could be roasting; it needs to be manageable but profitable, and if capacity is not being met, that is when options like private label roasting can be implemented.

Kling concluded the talk with the take away that we should be looking at the “Coffee industry through the eyes of agroforestry,” as “the coffee industry is not a mono-culture,” and has many diverse moving parts that need to work together to ensure its success.

• Kathryn Brand, associate editor, Tea & Coffee Trade Journal.
  Keep in touch via email: kathryn@bellpublishing.com Twitter: @TCTradeJournal or LinkedIn: Tea & Coffee Trade Journal

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In the specialty coffee industry, the quality of a cup of coffee is determined by the quality of the beans, with a single defective bean capable of ruining an entire roast. The Specialty Coffee Association (SCA) defines primary and secondary defective beans, including broken beans, beans with insect or fungal damage, black beans, and those contaminated with foreign matter. Manual sorting is incredibly time consuming and inefficient. Sorting by colour can often overlook smaller defects. The CS One solves these common problems by deploying AI to ensure accuracy and reduce time and labour while eliminating all SCA-classified defective beans. Coffee roasters will have far more freedom for tasks that require a human touch, like crafting exquisite blends and attending to customer needs.

The usually hours-long task of sorting green beans is now boiled down into two easy steps: filling the bean hopper with green coffee beans, then initiating the sorting process via the touch panel. Upon activation, green coffee beans drop through a passageway, passing through the AI-powered cameras with a 4K high resolution lens and a shutter speed of 1/16000 second, identifying good and defective beans based on the selected process method. Compressed air removes unwanted beans into a separate receptacle. This fully automates the burdensome process of green coffee bean sorting — leaving roasters more time to do other important tasks.

avercasso created a machine that blends seamlessly into any type of coffee shop, coming in 3 carefully colours — Bronze Gold, Champagne Gold, and Rose Gold. avercasso now also allows customers to choose a customised color for the machine.u

For those interested in the avercasso CS One, find more information here: sca2024.smallworldlabs.com/ai-sorting-aver-com-avercasso.

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The I-CIP averaged 186.36 US cents/lb in March, a 2.4% increase from February 2024. The I-CIP posted a median value of 185.64 US cents/lb, having fluctuated between 181.39 and 193.26 US cents/lb. The March 2024 I-CIP is above the March 2023 I-CIP by 9.6%, with the 12-month rolling average at 168.82 US cents/lb. The I-CIP grew steadily in March 2024, reaching an 18-month high. Remarkably, the Robustas have reached their highest level since October 1994 when they averaged 169.43 US cents/lb.

The Colombian Milds increased by 0.4% whilst the Other Milds remained stable with a 0.0% change, thereby reaching 210.27 and 208.88 US cents/lb, respectively, in March 2024. The Brazilian Naturals presented a decline of 0.5%, reaching an average of 185.77 US cents/lb. However, the Robustas grew by 8.2% to 165.84 US cents/lb, the highest level in almost 30 years. The Intercontinental Exchange’s (ICE) London market was also a strong driver of the growth, having increased by 4.3% to 148.53 US cents/lb, whilst the New York Futures market contracted by 0.4% to 184.59 US cents/lb.

The Colombian Milds–Other Milds differential expanded from 0.75 to 1.39 US cents/lb. The Colombian Milds–Brazilian Naturals differential grew 7.5% to 24.51 US cents/lb, whilst the Colombian Milds–Robustas differential shrank 21.1% from February to March 2024, averaging 44.43 US cents/lb. Meanwhile, the Other Milds–Brazilian Naturals differential grew 4.9% reaching 23.12 US cents/lb. However, the Other Milds–Robustas and the Brazilian Naturals–Robustas differentials both contracted 22.5% and 40.5%, averaging 43.04 and 19.92 US cents/lb, respectively, in March 2024.

Arbitrage, as measured between the London and New York Futures markets, retracted by 16.0% to 36.06 US cents/lb in March 2024.

Intra-day volatility of the I-CIP increased by 0.3 percentage points to 7.1% between February and March 2024. The Colombian Milds’ and Other Milds’ volatility decreased to 7.5% and 7.7%, respectively. Meanwhile, the Brazilian Naturals’ volatility declined by 0.7 percentage points to 8.1% from February to March 2024. The Robustas presented an average volatility of 8.8% for the month of March. The London Futures market’s volatility also decreased by 0.3 percentage points to 9.4%. Lastly, the New York futures market’s volatility moved in the same direction to that of London, reaching 8.6%, a 0.3 percentage point decline.

The London certified stocks expanded by 22.1% to 0.49 million 60-kg bags. Certified stocks of Arabica coffee reached 0.63 million 60-kg bags, an 80.8% increase since February 2024.

Exports by Coffee Groups – Green Beans
Global green bean exports in February 2024 totalled 10.43 million bags, as compared with 9.52 million bags in the same month of the previous year, up 9.5%. These are the largest February exports on record, beating the previous record set in 2019 of 10.34 million bags. The magnitude of the latest increase in exports of green beans, however, is more a reflection of a favourable base effect and a comparative normalisation of supply. From December 2022 to June 2023, the exports of green beans fell consecutively, with the cumulative total decreasing by 8.2% to 66.92 million bags, the lowest level seen for those same seven months since December 2016 to June 2017.

The cumulative total for coffee year 2023/24 to February is 50.82 million bags, as compared with 45.5 million bags over the same period a year ago, up 11.7%. Brazil was the main origin driving the growth, with exports expanding by 59.9% in February 2024 to 3.38 million bags from 2.11 million bags in February 2023, while among the different groups, the Brazilian Naturals were responsible.

Shipments of the Other Milds increased by 4.2% in February 2024 to 1.91 million bags from 1.83 million bags in the same period last year. Peru, the second largest producer and exporter of the Other Milds, continues to be the main driver of the growth of this group of coffee, with the origin’s exports thereof increasing by 178.6% to 0.18 million bags from 0.06 million bags in February 2023, representing an increase of 65.5% for the year to date (2.27 million bags). Peru’s exports of the Other Milds are on track to be the third biggest on record. As a result, the cumulative volume of total exports of the Other Milds also increased by 6.6% in the first five months of coffee year 2023/24 to 7.72 million bags, versus 7.24 million bags over the same period in 2022/23.

Green bean exports of the Brazilian Naturals increased in February 2024, rising by 36.6% to 3.16 million bags from 2.59 million bags in February 2023. For the first five months of coffee year 2023/24, green bean exports of the Brazilian Naturals amounted to 17.73 million bags, up 16.7% from 15.19 million bags over the same period a year ago. The sharp positive growth rate stems from the 38.4% increase in exports of the Brazilian Naturals from Brazil, the biggest producer and exporter of this group of coffee, which rose to 2.77 million bags in February 2024 from 2.0 million bags February 2023.

Exports of the Colombian Milds increased by 14.7% to 1.12 million bags in February 2024 from 0.98 million bags in February 2023. As a result, exports of the Colombian Milds for the first five months of coffee year 2023/24 are up 13.1% at 5.27 million bags, as compared with 4.65 million bags in the first five months of coffee year 2022/23. The double-digit growths, for both the current month and coffee year to date, are a consequence of the 11.9% weather-driven fall in exports in coffee year 2022/23 and subsequent normalization of supply conditions in Colombia, the largest producer and exporter of the Colombian Milds. For the current month and cumulative total to February 2024, the country’s exports of the Colombian Milds are up 15.4% and 13.2%, respectively.

In contrast to the Arabicas, green bean exports of the Robustas were down 3.7% to 4.24 million bags in February 2024 from 4.4 million bags in February 2023. Despite this, the cumulative total for the first five months of coffee year 2023/24 is up 9.2%, at 20.11 million bags, as compared with 18.41 million bags in the first five months of coffee year 2022/23. The main driver of February’s Robustas decrease was Vietnam, which shipped 2.54 million bags as compared with 3.17 million bags in February 2023, down 19.9%. Indonesia’s Robusta exports were also down 48.1%, with a net fall of 0.13 million bags.

Exports by Regions – All Forms of Coffee
Exports of all forms of coffee from Asia & Oceania decreased by 17.0% to 3.97 million bags in February 2024. The main source of the double-digit downturn is Vietnam, which saw its exports fall by 19.7% to 2.73 million bags in February 2024 from 3.4 million bags in February 2023. The size of the fall is the result of an unfavourable base effect, with the February 2023 export volume 1.04 million bags larger than the February average of the past six years (2.36 million bags).

On balance, Vietnam’s February 2024 export volume should be deemed at a healthy level, benefitting from high and rising local prices (the local green bean price increased to an average 80,000 VND/kg on 15 February 2024, from 61,000 VND/kg in the middle of November 2023) and triggering the release of stocks as farmers took advantage. Moreover, the Tet (lunar new year, which fell on 10 February 2024) would have brought additional supply to the market as farmers sought extra income for the most important social calendar date for the country and its people.

In February 2024, South America’s exports of all forms of coffee increased by 41.7% to 4.93 million bags. The source of the strong positive growth is Brazil, which saw its exports increase by 51.0% in February 2024 to 3.64 million bags – the second highest February exports on record for the origin. The overall recovery of Brazil’s export volume remains a reaction to the 31.8% fall in the February 2023 exports 2.41 million bags, the lowest February exports since 2.23 million bags in 2013. In coffee year 2022/23, Brazil’s exports declined by 7.9% to 36.5 million bags, the lowest level since the 32.69 million bags shipped in coffee year 2017/18. To date, Brazil’s exports are up 24.6% to 12.84 million bags.

Exports of all forms of coffee from Africa increased by 14.6% to 0.98 million bags in February 2024 from 0.86 million bags in February 2023. However, the cumulative total of 4.99 million bags for the first five months of coffee year 2023/24 remains down 2.5% as compared with the 5.1 million bags shipped in coffee year 2022/23. Ethiopia was the driving force behind the region’s increased exports in February 2024, with its own exports having increased by 103.9% to 0.2 million bags from 0.1 million bags in February 2023. The size of the rebound is due to a favourable base effect and a comparative normalization of market circumstances.

Contract disputes arising from a mismatch between local purchasing prices and global market prices had previously affected the volume of exports, leading February 2023’s shipment to be the lowest since 2010.

In February 2024, exports of all forms of coffee from Mexico & Central America were down 2.7% to 1.45 million bags, as compared with 1.49 million in February 2023. As a result, the cumulative total exports are down 3.9% from October 2023 to February 2024 at 3.94 million bags, as compared with 4.1 million bags for the same period a year ago. Costa Rica, El Salvador and Guatemala were the main origins behind the region’s negative growth, with exports down 24.5%, 40.3% and 5.7%, respectively, and a combined net loss of 58,812 bags. Partly counterbalancing these origins were Honduras and Mexico, with a combined net export gain of 24,756 bags in February, up 2.0% and 6.5%, respectively.

Exports of Coffee by Forms
Total exports of soluble coffee decreased by 18.2% in February 2024 to 0.85 million bags from 1.04 million bags in February 2023. In the first five months of coffee year 2023/24, a total of 5.05 million bags of soluble coffee were exported, representing an increase of 5.0% from the 4.81 million bags exported in the same period during the previous coffee year.

Soluble coffee’s share in the total exports of all forms of coffee for the year to date was 9.0% in February 2024, down from 9.5% in the same period a year ago. Brazil is the largest exporter of soluble coffee in February 2024, having shipped 0.26 million bags.

Exports of roasted beans were up 14.1% in February 2024 to 56,425 bags, as compared with 49,439 bags in February 2023. The cumulative total for coffee year 2023/24 to February 2024 was 0.32 million bags, as compared with 0.3 million bags in same period a year ago.

For the full report, visit: icocoffee.org.

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“This development is aligned with LDC’s strategy to diversify revenue streams through value-added product lines – in this case, by accelerating the scale-up of LDC’s soluble coffee business, recently initiated in Vietnam with its iLD Coffee Vietnam joint venture freeze-dried soluble coffee operation, to position LDC among the world’s largest soluble coffee producers,” said Michael Gelchie, CEO of Rotterdam, Netherlands-based LDC.

“This acquisition will further expand LDC’s business in Brazil, where the Group has been active for over 80 years, complementing our existing green coffee merchandizing operations in the country,” said Ben Clarkson, LDC’s global head of coffee. “With its in-depth market knowledge and recognised brand in the industry, Cacique’s highly complementary profile will strengthen and consolidate LDC’s soluble coffee activities.”

Londrina, Brazil-based Cacique is one of the largest global independent producers, processors and exporters of soluble coffee in terms of volume, with activities in more than 70 countries, best-in-class industrial know-how, two processing assets in the country, and a strong team of approximately 1,000 employees.

“We are pleased to announce this agreement with LDC, whose global reach and extensive expertise in coffee merchandizing will undoubtedly benefit our network of growers and customers, ensuring continued growth in the years ahead. We are confident that our employees will benefit from this new chapter for Cacique, whose history and culture will be preserved, as will the vision of our founder, Mr. Horácio Coimbra, and his successors,” said Cesario Coimbra, João Paulo Coimbra and Horácio Coimbra Neto.

The agreement is subject to regulatory approvals and customary closing conditions.

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The integrated facility is located in Jakarta’s district Bumi Serpong Damai, short BSD City, a strategic and modern development area in the southeastern part of Indonesia’s capital. The location is ideal as it is close to customers, downtown Jakarta and the city’s seaport. The climate-controlled warehouse will be used to store imported green coffees of all qualities.

As Indonesia is both a producing and an ever increasing consuming country, NKG Indonesia Imports will be incorporated in the most ideal period where the demand of green coffee will exceed the domestic grown availability. The values of NKG Indonesia Imports are there to complement the Indonesian Arabica and Robusta industry. With the group’s companies in Singapore, Korea, Vietnam and Indonesia grouped together as the NKG Asia Hub, NKG Indonesia Imports can draw on the hub’s resources and NKG’s network of exporters to provide unparalleled service and customised solutions to a growing number of roasters in Indonesia, from small to large.

“It is important to understand our client’s products and positions in order to offer value added services that makes NKG Indonesia Imports an essential player in the coffee eco-system in Indonesia,” said Mira Yudhawati, COO of NKG Indonesia Imports. 

NKG’s second group company based in Indonesian, Berindo Jaya, is the group’s export house in the country and has been in the market for more than 25 years.

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Green Coffee Price
The ICO Composite Indicator Price (I-CIP) averaged 175.73 US cents/lb in December, an 8.8% increase from November 2023. The I-CIP posted a median value of 177.64 US cents/lb, having fluctuated between 163.92 and 186.04 US cents/lb. The December 2023 I-CIP is above the December 2022 I-CIP by 11.8%, with the 12-month rolling average at 165.23 US cents/lb. The I-CIP grew steadily in December 2023, reaching a nine-month high. The rise in tensions in the Red Sea has prompted some shipping lines to re-route their coffee-carrying vessels. Thus, for South-East Asian and East African coffee en route to Europe, unintended consequences include a rise in freight costs as some shipping companies have introduced surcharges to account for the now-extended transit times.

The Colombian Milds and Other Milds increased by 7.6% and 6.9%, to 210.68 and 210.76 US cents/lb, respectively, in December 2023. The Brazilian Naturals presented a growth of 9.4%, reaching an average of 185.23 US cents/lb. However, the Robustas grew the most by 10.5% to 135.47 US cents/lb, the highest level since May 1995, when they were valued at 140.90 US cents/lb. ICE’s New York market was a strong driver of the positive growth, having increased by 9.6% to 186.67 US cents/lb, whilst the London Futures market expanded by 12.2%, to 123.91 US cents/lb, also the highest level since May 1995.

Arbitrage, as measured between the London and New York Futures markets, widened by 5.0% to 62.77 US cents/lb in December 2023.

Intra-day volatility of the I-CIP expanded to 10.2% between November and December 2023. The Colombian Milds’ and Other Milds’ volatility also increased to 10.8% and 10.9%, respectively. Meanwhile, the Brazilian Naturals’ volatility rose by 2.9 percentage points to 12.6% from November to December 2023. The Robustas presented the smallest volatility increase, with a 0.9 percentage point gain, averaging 9.2% for the month of December. The London Futures market’s volatility increased by 2.7 percentage points to 9.1%. Lastly, the New York futures market’s volatility moved in tandem to that of London, expanding by 2.4 percentage points and reaching 10.5%.

The New York certified stocks continued on their downward trajectory, retracting by 15.0% to 0.28 million 60-kg bags, one of the lowest figures ever recorded. Certified stocks of Robusta coffee reached 0.57 million 60-kg bags, a 68.4% increase since November 2023.

Exports by Coffee Groups — Green Beans
Global green bean exports in November 2023 totalled 9.79 million bags, as compared with 9.1 million bags in the same month of the previous year, up 7.6%. As a result, the cumulative total for coffee year 2023/24 to November is 18.39 million bags, as compared with 17.7 million bags over the same period a year ago, up 3.9%.

Shipments of the Other Milds increased by 17.9% in November 2023 to 1.31 million bags from 1.11 million bags in the same period last year. Peru was the main driver of the double-digit growth of this group of coffee, with the origin’s exports of the Other Milds increasing by 60.1% to 0.57 million bags in November 2023 from 0.35 million bags in November 2022, following a 28.9% increase in October 2023. The resurgence of Peru’s exports of the Other Milds is due to the return to normality of local production conditions in coffee year 2023/24 as compared with those seen in coffee year 2022/23. Irregular weather patterns negatively affected the local supply of coffee beans in 2022/23, especially in the first three months of the coffee year, when 1.15 million bags were exported. This was the lowest first three months of exports since the 0.93 million bags shipped in coffee year 2014/15, representing a 26.7% fall in the average volume of exports in coffee years 2015/16–2021/22, which was 1.57 million bags. As a result, the cumulative volume of total exports of the Other Milds also increased, jumping by 9.2% in the first two months of coffee year 2023/24 to 2.74 million bags, versus 2.51 million bags over the same period in 2022/23.

Green bean exports of the Brazilian Naturals increased in November 2023, rising by 1.6% to 3.63 million bags. For the first two months of coffee year 2023/24, green bean exports of the Brazilian Naturals amounted to 7.35 million bags, up 4.0% from 7.07 million bags over the same period a year ago. The relatively shallow positive growth rate reflects the 2.6% increase in exports of the Brazilian Naturals from Brazil, the biggest producer and exporter of this group of coffee, which rose to 3.2 million bags in November 2023 from 3.12 million bags November 2022.

Exports of the Colombian Milds increased by 34.0% to 1.15 million bags in November 2023 from 0.85 million bags in November 2022, driven primarily by Colombia, the main origin of this group of coffee, whose exports of green beans were up 35.6% in November 2023. As a result, exports of the Colombian Milds for the first two months of coffee year 2023/24 are up 18.7% at 2.1 million bags, as compared with 1.77 million bags in the first two months of coffee year 2022/23.

Green bean exports of the Robustas amounted to 3.7 million bags in November 2023, as compared with 3.56 million bags in November 2022, up 4.0%. In volume terms, these constitute the biggest November exports on record, surpassing the level set in November 2022. However, the rise was not sufficient to offset the 10.9% decrease observed in October 2023, when the 2.49 million bags exported represented the lowest quantity for the month since the 1.91 million bags in October 2011. As a result, the cumulative total for the first two months of coffee year 2023/24 is down 2.5%, at 6.2 million bags, as compared with 6.36 million bags in the first two months of coffee year 2022/23. The main driver of November’s Robustas increase was Brazil, shipping 0.86 million bags, a jump of 850.2%.

Exports by Regions — All Forms of Coffee
In November 2023, South America’s exports of all forms of coffee increased by 24.7% to 6.07 million bags. The source of the strong positive growth is mainly Brazil, which saw its exports increase by 21.1% to 4.34 million bags from 3.58 million bags in November 2022. More specifically, it was the Robustas from the origin, which in November increased by 850.2% to 0.86 million bags from 0.09 million bags, which drove the region’s positive growth. The November 2023 exports are Brazil’s highest on record for Robusta coffee, beating the 698,856 bags exported in August 2023. Brazil is one of the largest producers and exporters of the Robustas, having accounted for an 8.1% share of the group’s total exports in coffee year 2021/22, i.e. 3.94 million bags. That said, in July–October 2023, Brazil’s share of the Robustas more than doubled, increasing to 22.3%, with the country exporting 3.09 million bags in just four months. This surge was in response to the reduced volume of Robustas coming out of Vietnam, whose Robusta exports fell by 27.5% in July–October 2023 to 4.92 million bags from 6.78 million bags over the same period a year ago. The continued rampant expansion of Brazil’s Robusta exports despite Vietnam’s recovery in November 2023 suggests that its strong foray into this market may continue.

Robusta exports fell by 27.5% in July–October 2023 to 4.92 million bags from 6.78 million bags over the same period a year ago. The continued rampant expansion of Brazil’s Robusta exports despite Vietnam’s recovery in November 2023 suggests that its strong foray into this market may continue.

Exports of all forms of coffee from Africa decreased by 13.5% to 1.01 million bags in November 2023 from 1.16 million bags in November 2022. For the first two months of coffee year 2023/24, exports totalled 2.06 million bags as compared with 2.24 million bags in coffee year 2022/23, down 8.1%. This is the third consecutive month of negative growth for the region and it affected most origins, including all the major producers whose combined exports decreased by 11.4% to 0.93 million bags from 1.05 million bags in November 2022. It is speculated that the surge in Brazil’s Robusta exports is crowding out traditional exporters of the group from the market, thus broadly affecting Africa as a whole, which is a largely Robusta-producing region. Uganda, the largest producer and exporter of Robusta coffee in Africa, was also affected by a delayed harvest season which negatively impacted the supply availability.

In November 2023, exports of all forms of coffee from Mexico & Central America were up 15.7% to 0.41 million bags, as compared with 0.35 million in November 2022. As a result, total exports are up 11.0% for October 2023 to November 2023 at 0.9 million bags, as compared with 0.81 million bags for the same period a year ago. Guatemala, Honduras and Mexico are the three main origins behind the region’s double-digit growth in November, with their respective exports up 114.0%, 29.7% and 11.8%. These robust growth rates do not, however, herald the beginning of a record-breaking year for the three origins or for the region, but rather are indications that export volumes are returning to the levels of the recent past, following a sharp fall in coffee year 2022/23. Accordingly, the average October–November export volume for coffee years 2017/18–2021/22 was 0.7 million bags for the three countries as compared with 0.6 million bags in coffee year 2022/23, a 14.6% fall. This has now increased to 0.68 million bags in coffee year 2023/24.

Exports of all forms of coffee from Asia & Oceania decreased by 18.0% to 3.12 million bags in November 2023. November’s downturn was mainly due to Indonesia, with exports down 45.2% to 0.49 million bags from 0.89 million bags in November 2022. These are the lowest November exports since the 0.2 million bags shipped in 2018. The decrease can be attributed to a reduced harvest in coffee year 2023/24, which is estimated to have fallen by 16.6% to 10.0 million bags from 11.98 million bags in coffee year 2022/23 on the back of excessive rains that damaged cherries in April–May 2023. Vietnam’s exports fell by 7.7% in November, a vast improvement from the steep declines of 23.6%, 45.0% and 44.7% seen in August, September and October 2023. This may indicate that its supply issues have now started to resolve after very low in-origin stock levels were reported in Q4 of coffee year 2022/23, when the start of the harvest still remained three to four months away.

Exports of Coffee by Forms
Total exports of soluble coffee decreased by 25.4% in November 2023 to 0.77 million bags from 1.03 million bags in November 2022. In the first two months of coffee year 2023/24, a total of 1.75 million bags of soluble coffee were exported, representing a decrease of 3.0% from the 1.8 million bags exported in the same period during the previous coffee year.

Soluble coffee’s share in the total exports of all forms of coffee for the year to date was 8.6% in November 2023, down from 9.2% in the same period a year ago. Brazil is the largest exporter of soluble coffee, having shipped 0.24 million bags in November 2023.

Exports of roasted beans were down 15.5% in November 2023 to 54,379 bags, as compared with 64,324 bags in November 2022. The cumulative total for coffee year 2023/24 to November 2023 was 0.1 million bags, as compared with 0.13 million bags in same period a year ago.

Production and Consumption
World coffee production increased by 0.1% to 168.2 million bags in coffee year 2022/23. The stagnant growth rate belies the tremendous changes at the regional level, with the coffee world neatly split between the expanding Americas and the shrinking rest of the world.

Asia & Oceania and Africa’s 4.7% and 7.2% decreases in production to 49.84 million bags and 17.9 million bags, respectively, can be attributed to adverse weather conditions negatively affecting key producers in the regions, particularly Vietnam, Côte d’Ivoire and Uganda. The magnitude of the fall in outputs of the two regions was entirely mitigated by the Americas, especially by South America’s 4.8% increase, which in turn was driven mainly by the biennial production-affected 8.4% increase in Brazil. The combined output of the Americas was 100.5 million bags.

The Americas versus the rest of the world split was also reflected in the production split between the Arabicas and Robustas, with the former’s output increasing by 1.8% to 94.0 million bags as compared with the 2.0% decrease of the latter to 74.2 million bags.

Looking ahead, the output for coffee year 2023/24 is expected to increase by 5.8% to 178.0 million bags, with the Arabicas’ output rising to 102.2 million bags and the Robustas’ increasing to 75.8 million bags.

The biennial production effect will play a large role in the outlook, especially for Brazil and the Arabicas, as the impact of the July 2021 frost continues to be resolved. Coffee year 2023/24 is anticipated to be an exceptional off-biennial year, feeling more like a good on-biennial following an average on-biennial year. Adverse weather conditions, first noted in 2022 and continuing into 2023, will have a negative impact on the outlook for coffee year 2023/24. The anticipated El Niño phenomenon is set to dampen the outlook in Asia, especially for origins like Indonesia. Meanwhile, Vietnam is expected to benefit from the drier/hotter weather as irrigation mitigates the reduced precipitation.

World coffee consumption is continuing to resolve through the issues brought about by the COVID-19 pandemic, with the consumption trend following an established patten in response to an external shock. The expectation for coffee year 2022/23 was for a smaller positive growth rate; however, world coffee consumption actually recorded a decrease of 2.0% to 173.1 million bags.

Consumption in coffee year 2022/23 did not faithfully follow the established pattern due to the impact of the high cost of living, falling disposable incomes and a long stocks drawdown. Despite coffee being relatively inelastic, the challenging global economic environment would have had a negative impact on its consumption. The world inflation rate was at its highest in 2021 at 9.4%, while the benchmark interest rate averaged 4.9% at the end of September 2023 in the European Union, UK and USA, the highest level since an average of 5.8% in 2000. At the same time, there was a large drawdown of stocks, where combined stocks reported by the European Coffee Federation and those held at the Intercontinental Exchange’s warehouses in the USA fell by 4.8 million bags from 14.5 million to 9.8 million. This drawdown would have reduced the need for purchases on the international market, seemingly reflected as lower and anomalous global consumption rates for coffee year 2022/23.

The world coffee consumption outlook for coffee year 2023/24 is broadly framed by the assumption that the global economy will continue to grow at above 3.0%, and that the industry will respond to the large drawdown of stocks, which will be positively reflected in apparent consumption. As a result, world coffee consumption is expected to grow by 2.2% to 177.0 million bags, with non-producing countries making the biggest contribution to the overall increase. Coffee consumption in this group of countries should expand by 2.1%.

As a result, the world coffee market is expected to run a surplus of 1.0 million bags in coffee year 2023/24.

The outlook is taken from the newest publication of the Statistics Section of the Secretariat of the International Coffee Organization (ICO), the Coffee Report and Outlook (CRO). For the full CRO or for more information, visit the ICO website: icocoffee.org.

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The ICO Composite Indicator Price (I-CIP) averaged 161.53 US cents/lb in November, a 6.3% increase from October 2023. The I-CIP posted a median value of 161.63 US cents/lb, having fluctuated between 153.32 and 169.99 US cents/lb. The November 2023 I-CIP is above the November 2022 I-CIP by 3.1%, with the 12-month rolling average at 163.69 US cents/lb, having ranged in between 151.94 in October 2023 and 178.57 US cents/lb in April 2022. The I-CIP has remained stable around the 160 US cents/lb mark, with daily price variation declining on average for the October 2022 to November 2023 range, only 0.04%.

The Colombian Milds and Other Milds increased by 5.3% and 7.2%, to 195.85 and 197.18 US cents/lb, respectively, in November 2023. The Brazilian Naturals presented the strongest growth of 8.8%, reaching an average of 169.25 US cents/lb. However, the Robustas also grew by 3.2% to 122.63 US cents/lb. The International Coffee Exchanges’s (ICE) New York market was a strong driver of the positive growth, growing by 9.2% to 170.25 US cents/lb whilst the London Futures market expanded by 4.8%, to 110.45 US cents/lb.

The Colombian Milds–Other Milds differential contracted from 2.02 to 1.33 US cents/lb. The Colombian Milds–Brazilian Naturals differential shrank 12.6% % to 26.60 US cents/lb, whilst the Colombian Milds–Robustas differential also expanded 9.1% from October to November 2023, averaging 73.22 US cents/lb. Meanwhile, the Other Milds–Brazilian Naturals differential contracted 1.8%, reaching 27.93 US cents/lb. However, the Other Milds–Robustas and the Brazilian Naturals–Robustas differentials expanded 14.5% and 27.1%, averaging 74.55 and 46.62 US cents/lb, respectively, in November 2023.

Arbitrage, as measured between the London and New York Futures markets, widened by 18.4% to 59.81 US cents/lb in November 2023. Intra-day volatility of the I-CIP was raised to 8.0% between October and November 2023. The Colombian Milds’ and Other Milds’ volatility also increased to 8.7% and 8.8%. Meanwhile, the Brazilian Naturals’ volatility rose by 1.1 percentage points to 9.7% from October to November 2023. The Robustas presented the smallest volatility increase, with a 0.8 percentage point gain, averaging 8.3% for the month of November. The London Futures market’s volatility decreased by 2.4 percentage points to 9.1%. Lastly, the New York futures market’s volatility moved in tandem to that of London, expanding by 2.4 percentage points and reaching 10.5%.

The New York and London certified stocks continued on their downward trajectory, where London retracted by 49.2% to 0.34 million 60-kg bags, the lowest figure recorded since March 2014. Certified stocks of Arabica coffee reached 0.32 million 60-kg bags, a 24.5% decrease.

Exports by Coffee Groups – Green Beans
Global exports of green beans in October 2023 totalled 8.57 million bags, compared with 8.61 million bags in the same month of the previous year, down 0.4%. The downturn was driven by the Robustas, the only one of the four groups to start coffee year 2023/24 with negative growth.

The Brazilian Naturals made a strong start to the new coffee year, with exports increasing by 10.0% to 4.02 million bags from 3.66 million bags in October 2022. This is the second-highest volume exported in the month of October on record, just behind the 3.9 million bags shipped in 2020. Brazil was the main driver of this strong start, with the origin’s total green bean exports up 23.0% to 4.08 million bags in October 2023, which is also the country’s second-highest volume of exports in the month of October to be documented.

Exports of the Colombian Milds increased by 0.2% to 1.031 million bags in October 2023 from 1.03 million bags in October 2022. The near-stagnant start to the new coffee year was due to the conflation of the continued downturn in Colombia, the largest producer and export of the Colombian Milds, and the strong start made by Kenya and Tanzania, the two other origins that make up this coffee group.

Shipments of the Other Milds decreased by 1.8% in October 2023 to 1.59 million bags from 1.62 million bags in the same period last year. The main negative contributions came from Brazil (down 66.2% and 78,719 bags) and Papua New Guinea (down 34.3% and 53,737 bags), while Honduras provided the largest positive contribution (up 28.9% and 138,993 bags).

Of the four coffee groups, the Robustas have recorded the highest contraction in the new coffee year to date, with exports falling by 8.0% to 2.88 million bags from 3.14 million bags. Vietnam, the largest Robusta producer in the world, was the driver of the sharp downturn, with exports of Robusta green beans down 45.2% to 0.69 million bags in October 2023 from 1.26 million bags in October 2022.

Exports by Regions – All Forms of Coffee
In October 2023, South America’s exports of all forms of coffee increased by 16.4% to 5.95 million bags. Brazil was the main driving force of the double-digit growth of the region, having shipped 4.37 million bags in October 2023, a jump of 21.7%. Peru provided added support, with its exports increasing by 28.9% to 0.62 million bags from 0.48 million bags in October 2022.

Exports of all forms of coffee from Asia & Oceania totalled 2.05 million bags in October 2023, decreasing by 26.7%. Vietnam, the world’s second-largest producer and exporter of coffee, was the main driver of the region’s sharp downturn, with total exports down 44.7% to 0.75 million bags in October 2023 from 1.36 million bags in October 2022. This was the lowest volume of exports since the 0.7 million bags shipped in October 2008. A shortage of exportable materials within Vietnam, due to the lower-than-expected harvest in coffee year 2022/23, a delay in supply from the current coffee year’s harvest and a very strong export performance in the first nine months of the previous coffee year, explain the sharp downturn.

Exports of all forms of coffee from Africa decreased by 1.0% to 1.07 million bags in October 2023 from 1.08 million bags in October 2022. Ethiopia (–13.5%), Rwanda (–34.8%) and Cameroon (–57.4%) were the three main origins making a negative contribution to the region’s exports, in absolute terms, while Burundi (200.0%), Côte d’Ivoire (40.9%), Kenya (31.4%) and Uganda (2.8%) were the main origins making positive contributions. According to the Uganda Coffee Development Authority, the promising export performance in October 2023 was due to adequate supply from a good crop harvest in the South-Western region and the prevailing good prices on the global scene which prompted exporters to release their stocks. In Ethiopia, contract disputes arising out of a mismatch between local purchasing prices and the global market prices, first reported in the middle of coffee year 2022/23, continue to negatively impact export volume in the new coffee year.

In October 2023, exports of all forms of coffee from Mexico & Central America were up 0.4% to 0.459 million bags as compared with 0.457 million in October 2022. The performances of individual origins belied the less-than-dynamic growth of the region, with very strong negative and positive growth rates registered in October: Costa Rica (212.7%), El Salvador (69.6%), Guatemala (18.0%) and Nicaragua (15.6%) on the expansion side against the decreasing Dominican Republic (–80.1%), Honduras (–39.2%) and Mexico (–11.1%).

Exports of Coffee by Forms
Total exports of soluble coffee increased by 16.9% in October 2023 to 0.91 million bags from 0.78 million bags in October 2022. Soluble coffee’s share in the total exports of all forms of coffee for the year to date was 10.6% in October 2023, up from 9.0% for the same period a year ago. Brazil is the largest exporter of soluble coffee, having shipped 0.28 million bags in October 2023. Exports of roasted beans were down 20.4% in October 2023 to 49,185 bags, as compared with 61,781 bags in October 2022.

Production and Consumption
World coffee production increased by 0.1% to 168.2 million bags in coffee year 2022/23. The stagnant growth rate belies the tremendous changes at the regional level, with the coffee world neatly split between the expanding Americas and the shrinking rest of the world.

Asia & Oceania and Africa’s 4.7% and 7.2% decreases in production to 49.84 million bags and 17.9 million bags, respectively, can be attributed to adverse weather conditions negatively affecting key producers in the regions, particularly Vietnam, Côte d’Ivoire and Uganda. The magnitude of the fall in outputs of the two regions was entirely mitigated by the Americas, especially by South America’s 4.8% increase, which in turn was driven mainly by the biennial production-affected 8.4% increase in Brazil.

The combined output of the Americas was 100.5 million bags. The Americas versus the rest of the world split was also reflected in the production split between the Arabicas and Robustas, with the former’s output increasing by 1.8% to 94.0 million bags as compared with the 2.0% decrease of the latter to 74.2 million bags.

Looking ahead, the output for coffee year 2023/24 is expected to increase by 5.8% to 178.0 million bags, with the Arabicas’ output rising to 102.2 million bags and the Robustas’ increasing to 75.8 million bags.

The biennial production effect will play a large role in the outlook, especially for Brazil and the Arabicas, as the impact of the July 2021 frost continues to be resolved. Coffee year 2023/24 is anticipated to be an exceptional off-biennial year, feeling more like a good on-biennial following an average on-biennial year. Adverse weather conditions, first noted in 2022 and continuing into 2023, will have a negative impact on the outlook for coffee year 2023/24. The anticipated El Niño phenomenon is set to dampen the outlook in Asia, especially for origins like Indonesia. Meanwhile, Vietnam is expected to benefit from the drier/hotter weather as irrigation mitigates the reduced precipitation.

World coffee consumption is continuing to resolve through the issues brought about by the Covid-19 pandemic, with the consumption trend following an established patten in response to an external shock. The expectation for coffee year 2022/23 was for a smaller positive growth rate; however, world coffee consumption actually recorded a decrease of 2.0% to 173.1 million bags.

Consumption in coffee year 2022/23 did not faithfully follow the established pattern due to the impact of the high cost of living, falling disposable incomes and a long stocks drawdown. Despite coffee being relatively inelastic, the challenging global economic environment would have had a negative impact on its consumption. The world inflation rate was at its highest in 2021 at 9.4%, while the benchmark interest rate averaged 4.9% at the end of September 2023 in the European Union, UK and USA, the highest level since an average of 5.8% in 2000. At the same time, there was a large drawdown of stocks, where combined stocks reported by the European Coffee Federation and those held at the Intercontinental Exchange’s warehouses in the USA fell by 4.8 million bags from 14.5 million to 9.8 million. This drawdown would have reduced the need for purchases on the international market, seemingly reflected as lower and anomalous global consumption rates for coffee year 2022/23.

The world coffee consumption outlook for coffee year 2023/24 is broadly framed by the assumption that the global economy will continue to grow at above 3.0%, and that the industry will respond to the large drawdown of stocks, which will be positively reflected in apparent consumption. As a result, world coffee consumption is expected to grow by 2.2% to 177.0 million bags, with non-producing countries making the biggest contribution to the overall increase. Coffee consumption in this group of countries should expand by 2.1%.

Balance. As a result, the world coffee market is expected to run a surplus of 1.0 million bags in coffee year 2023/24.

The outlook is taken from the newest publication of the Statistics Section of the Secretariat of the International Coffee Organization (ICO), the Coffee Report and Outlook (CRO). To download the full report or for more information, visit: icocoffee.org.

The post <strong>Coffee prices remain stable averaging above 160 US cents/lb in November 2023</strong> appeared first on Tea & Coffee Trade Journal.

Last week I visited Indonesia with a group of international journalists, organised by ofi (formerly Olam) to learn about the green coffee supplier’s regenerative practices and decarbonisation strategies in Aceh (12 hours by car from Medan). ofi is one of the top three suppliers of green coffee globally and operates in 18 growing origins across Africa, Asia, Central and South America. ofi has been in Indonesia since 1996, and today buys coffee, cocoa, nutmeg, and black and white pepper from more than 400,000 farmers, collectors and suppliers throughout the archipelago. Presently, ofi exports Arabica and Robusta, and has a combined market share of approximately 15%.

ofi’s Coffee LENS 2022 impact report (published in November) noted that in 2022, the company introduced regenerative land practices to an area equivalent to 47,000 football (soccer) fields, increased the share of renewable energy in its processing facilities to more than 50%, and achieved over 81% traceability to farmer/farmer group/regional level. ofi’s availability of sustainable coffee stands at more than 40% (directly sourced).

On the coffee farms throughout Aceh, we observed farmer training sessions on agroforestry, composting, and other regenerative practices in action (including fertiliser made from fruit that is safe for human consumption). We also participated in a mock polygon mapping, which ofi has been doing as part of its sustainability practices but this also meets EU requirements for traceability and environmental due diligence. We then had the opportunity to learn about post-harvest processing at wet and dry mills, and cup a variety of coffees (some were truly amazing, at least according to my limited palate).

The trip fell amid the peak of the second harvest period, when farm activities, post-harvest practices and processing were in full swing. During this time, ofi hosts its annual Farmers’ Day celebration, which, designed by its Indonesia team, acknowledges and rewards the efforts and engagement of the farmers in ofi’s supply chain in Aceh. Activities will include games, cultural displays, and distribution of premiums to the farmers. One of the more interesting awards was given to farmers in the cooperative who have downloaded – and are using – a banking app, in order to encourage more farmers to do so.

It is always beneficial to be able to interact with the farmers and politely pepper them with questions about being a coffee farmer – the rewards and challenges – what it is like working with new technologies and learning new coffee-growing methods and techniques, and of course, implementing the growing number of sustainability strategies, as well as to see how they operate and often, where and how they live (unlike many coffee-growing regions, in Indonesia, the farmers do not live on their coffee farms). And while speaking with the farmers, their children are most often not far behind, eyes wide open with curiosity. Some of the brave will come up – always in a group, never alone – and ask questions in the English they are learning. Then they giggle and run away, which is adorable.

On the occasion of ofi’s third Farmers’ Day, our group was treated to a special performance by the children, choreographed just for us. It was beautiful, fun and heartwarming.

When we visited Aceh, the prolonged and heavy rains had delayed the bulk of the harvest (some coffee had been picked), and while stressful for the farmers, on this special day celebrating them, the joy on their faces was evident, knowing that they were being appreciated for their efforts.

• Vanessa L Facenda, editor, Tea & Coffee Trade Journal.
  Keep in touch via email: vanessa@bellpublishing.com Twitter: @TCTradeJournal or LinkedIn: Tea & Coffee Trade Journal

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Green Coffee Price
The ICO Composite Indicator Price (I-CIP) averaged 151.94 US cents/lb in October, a 0.8% decline from September 2023. The I-CIP posted a median value of 151.58 US cents/lb, having fluctuated between 145.99 and 160.09 US cents/lb.

The Colombian Milds and Other Milds increased by 0.5% and 0.2%, to 185.97 and 183.95 US cents/lb, respectively, in October 2023. The Brazilian Naturals presented the strongest growth of 0.9%, reaching an average of 155.52 US cents/lb. However, Robustas retracted 4.1% to 118.83 US cents/lb. ICE’s New York market grew by 1.5% whilst the London Futures market shrank by 3.4%, to 155.91 and 105.40 US cents/lb, respectively.

The Colombian Milds-Other Milds differential grew 38.5% to 2.02 US cents/lb. The Colombian Milds-Brazilian Naturals differential shrank 1.1% to 30.45 US cents/lb, whilst the Colombian Milds-Robustas differential also expanded 9.9% from September to October 2023, averaging 67.14 US cents/lb. Meanwhile, the Other Milds-Brazilian Naturals differential contracted 3.1%, reaching 28.43 US cents/lb. However, the Other Milds-Robustas and the Brazilian Naturals-Robustas differentials expanded 9.2% and 21.1%, averaging 65.12 and 36.69 US cents/lb, respectively, in October 2023.

Arbitrage, as measured between the London and New York Futures markets, widened by 13.7% to 50.51 US cents/lb in October 2023.

Intra-day volatility of the I-CIP remained stable at 6.3% between September and October 2023. The Colombian Milds’ and Other Milds’ volatility also increased to 6.8% and 7.6%. Meanwhile, the Brazilian Naturals’ volatility rose by 0.5 percentage points to 8.6% from September to October 2023. The Robustas presented the smallest volatility increase, with a 0.1 percentage point gain, averaging 7.5% for the month of October. The London Futures market’s volatility decreased by 0.6 percentage points to 6.7%. Lastly, the New York futures market’s volatility moved in the opposite direction to that of London, expanding by 0.4 percentage points and reaching 8.1%.

The New York and London certified stocks moved in the same downward direction, where London retracted by 7.9% to 0.67 million 60-kg bags, whilst certified stocks of Arabica coffee reached 0.44 million 60-kg bags, a 10.7% decrease and the lowest figure since October 2022.

Exports by Coffee Groups – Green Beans
Global green bean exports in September 2023 totalled 7.8 million bags, as compared with 8.83 million bags in the same month of the previous year, down 11.6%. For coffee year 2022/23, exports of green beans were down 5.5% to 110.81 million bags from 117.28 million bags in coffee year 2021/22. The global macro-economic environment was not conducive to consumer confidence in coffee year 2022/23, with global inflation and interest rates in many of the key advanced economies high and rising, increasing the cost of living and thus reducing disposable income levels for a very large section of the world.

These conditions seemingly support a downturn in the consumption of coffee and consequently in global exports of green beans. Nevertheless, the global economy was not only projected to expand in calendar year 2023, but the outlook was also raised between April–October 2023 by the International Monetary Fund (IMF), which suggests otherwise. The drop in global exports of green beans in coffee year 2022/23 may therefore lie more with logistics/the supply chain than the economy and actual consumption of coffee. Average green bean exports amounted to 118.13 million bags in coffee years 2018/19–2021/22, as compared with an average 109.59 million bags for coffee years 2014/15–2017/18, a jump of 8.54 million bags. This suggests a build-up of stocks in non-producing countries which have been heavily drawn down in the past 12 months.

Shipments of the Other Milds decreased by 13.1% in September 2023 to 1.57 million bags from 1.8 million bags in the same period last year. For coffee year 2022/23, exports of the Other Milds were down 12.1% to 22.11 million bags from 25.16 million bags in coffee year 2021/22. Green bean exports of the Brazilian Naturals decreased in September 2023, falling by 13.4% to 2.69 million bags. For coffee year 2022/23, exports of the Brazilian Naturals were down 8.5% to 34.17 million bags from 37.33 million bags in coffee year 2021/22. Exports of the Colombian Milds increased by 6.7% to 0.87 million bags in September 2023 from 0.82 million bags in September 2022. For coffee year 2022/23, exports of the Colombian Milds were down 11.2% to 10.77 million bags from 12.14 million bags in coffee year 2021/22. For coffee year 2022/23, total green bean exports of the Arabicas were down 10.1% to 67.05 million bags from 74.63 million bags in coffee year 2021/22.

Overall, for the Arabicas, exports were seemingly negatively affected by the drawdown of stocks in consuming countries, with buyers staying away from the markets in coffee year 2022/23. Furthermore, substitution towards the more competitively priced Robustas, induced by the increased cost of living and reduced disposable income, would have also added to the downturn (see Green Coffee Price).

Exports of the Colombian Milds fell below the 11.0 million bags mark for the first time since coffee year 2012/13. These exports were primarily driven by Colombia, the main origin of this group of coffee, and weather-related disruption affected supply throughout most of coffee year 2022/23. Indeed, Colombia’s green bean exports contracted for the first 11 months of coffee year 2022/23, with only September 2023 showing an expansion. Figures for the year show that, overall, the country’s exports declined 13.1% to 9.42 million bags, the first time they have dropped below 10.0 million bags since coffee year 2013/14.

Green bean exports of the Robustas amounted to 2.67 million bags in September 2023, as compared with 3.09 million bags in September 2022, down 13.8%. For coffee year 2022/23, exports of the Robustas were up 2.6% to 43.76 million bags from 42.66 million bags in coffee year 2021/22. Of the four groups of coffee, the Robustas were the only group to experience positive growth in coffee year 2022/23, benefitting from macro-economic-induced substitution away from less competitively priced Arabicas.

The September 2023 exports represent the lowest September volume for the Robustas since the 2.58 million bags shipped in 2012 and were a result of the 43.4% decrease in exports from Vietnam, the world’s largest producer and exporter of the group, which only shipped 0.81 million bags – the lowest September exports since 2008 (0.79 million bags). Vietnam has been struggling with supply since the start of Q4 of coffee year 2022/23, when very low in-origin stock levels were reported at a time when the start of the harvest still remained three to four months away. The low September 2023 export levels appear to be a continuation of the industry’s deepening struggle with supply issues.

Exports by Regions – All Forms of Coffee
In September 2023, South America’s exports of all forms of coffee decreased by 3.4% to 4.74 million bags. For coffee year 2022/23, the region’s exports were down 11.0% to 50.59 million bags from 56.83 million bags in coffee year 2021/22. The region’s two largest producers and exporters, Brazil and Colombia, saw their total exports fall by 7.9% and 12.8%, respectively. South America’s fortunes are closely tied to the fortunes of the Arabicas and many of the same factors that explain the latter’s double-digit fall also explain the former’s. After all, from coffee year 2018/19 to 2022/23, 93.2% of the total green bean exports from South America were Arabicas, on average. The drawdown of stocks in consuming countries and substitution towards the Robustas are the two main factors. Two specific and additional factors are that (i) Brazil’s export performance was poor due to its relatively limited supply following two consecutive years of below-par harvests; and (ii) Colombia struggled with weather-impacted supply conditions that negatively affected the origin’s export volume.

Exports of all forms of coffee from Africa decreased by 1.9% to 1.21 million bags in September 2023 from 1.23 million bags in September 2022. For coffee year 2022/23, the region’s exports were down 1.4% to 13.53 million bags from 13.73 million bags in coffee year 2021/22. The relatively strong global demand for Robustas was the fundamental source of Africa’s positive export growth rate in coffee year 2022/23. Moreover, particularly during Q4 of coffee year 2022/23, the reduced volume of exports from the Asia and Oceania region, and more pointedly from Vietnam, strengthened Africa’s own export performance. Uganda, the largest producer and exporter of Robusta coffee in Africa, took the opportunity to fill the gap in the market left by Vietnam and the Asia and Oceania region as a whole.

In September 2023, exports of all forms of coffee from Mexico and Central America were down 9.2% to 0.74 million bags as compared with 0.81 million bags in September 2022. For coffee year 2022/23, the region’s exports were down 3.1% to 15.3 million bags from 15.78 million bags in coffee year 2021/22. The downturn was primarily driven by Guatemala and Mexico, which suffered 11.5% and 16.5% decreases, respectively. However, the mitigating factor that limited the region’s fall in exports to a low single-digit decrease was Honduras’ 13.5% increase.

Exports of all forms of coffee from Asia and Oceania decreased by 35.7% to 1.91 million bags in September 2023 as compared with 2.98 million bags in September 2022. For coffee year 2022/23, the region’s exports were down 0.9% to 43.56 million bags from 43.95 million bags in coffee year 2021/22. Asia and Oceania’s fortunes are closely tied to the fortunes of the Robustas and many of the same factors that explain the latter’s single-digit increase also explain the former’s. From coffee year 2018/19 to 2022/23, 89.1% of the total green bean exports from Asia & Oceania were Robustas, on average. In coffee year 2022/23, Vietnam’s exports were up 0.4% to 28.29 million bags from 28.19 million bags in coffee year 2021/22.

Exports of Coffee by Forms
Total exports of soluble coffee decreased by 27.3% in September 2023 to 0.75 million bags from 1.03 million bags in September 2022. For coffee year 2022/23, soluble coffee exports were down 5.7% to 11.47 million bags from 12.16 million bags in coffee year 2021/22.

Soluble coffee’s share in the total exports of all forms of coffee for the year to date was 8.7% in September 2023, down from 10.4% for the same period a year ago. For coffee year 2022/23, soluble coffee’s share of the total exports was 9.3%, the same as in coffee year 2021/22. Brazil is the largest exporter of soluble coffee, having shipped 0.27 million bags in September 2023 and 3.77 million bags in coffee year 2022/23.

Exports of roasted beans were down 26.7% in September 2023 to 55,203 bags, as compared with 75,355 bags in September 2022. For coffee year 2022/23, roasted coffee exports were down 16.0% to 0.71 million bags from 0.84 million bags in coffee year 2021/22.

Production and Consumption
Under the current circumstances, the estimates and outlook of production and consumption for coffee years 2021/22 and 2022/23 remain the same.

World coffee production decreased by 1.4% to 168.5 million bags in coffee year 2021/22, hampered by the off-biennial production and negative meteorological conditions in a number of key origins. However, it is expected to bounce back by 1.7% to 171.3 million bags in 2022/23. Increased global fertiliser costs and adverse weather conditions are expected to partially offset the positive impact of biennial production from Brazil, explaining the relatively low rate of growth in coffee year 2022/23.

The impact of biennial production is anticipated to drive the outlook for Arabica, which is projected to increase by 4.6% to 98.6 million bags in coffee year 2022/23, following a 7.2% decrease in the previous coffee year. Reflecting its cyclical output, Arabica’s share of the total coffee production is expected to increase to 57.5% from 55.9% in coffee year 2021/22. South America is and will remain the largest producer of coffee in the world, despite suffering from the largest drop in output for almost 20 years, which fell by 7.6% in coffee year 2021/22. The recovery in coffee year 2022/23, partly driven by biennial production, is expected to push the region’s output to 82.4 million bags, a rise of 6.2%.

World coffee consumption increased by 4.2% to 175.6 million bags in coffee year 2021/22, following a 0.6% rise the previous year. Release of the pent-up demand built up during the Covid-19 years and sharp global economic growth of 6.0% in 2021 explains the sharp bounce back in coffee consumption in coffee year 2021/22. Decelerating world economic growth rates for 2022 and 2023, coupled with the dramatic rise in the cost of living, will have an impact on the coffee consumption for coffee year 2022/23. It is expected to grow, but at a decelerating rate of 1.7% to 178.5 million bags. The global deceleration is expected to come from non-producing countries, with Europe’s coffee consumption predicted to suffer the largest decrease among all regions, with growth rates falling to 0.1% in coffee year 2022/23 from a 6.0% expansion in coffee year 2021/22.

As a result, the world coffee market is expected to run another year of deficit, a shortfall of 7.3 million bags.

The outlook is taken from the newest publication of the Statistics Section of the Secretariat of the International Coffee Organization (ICO), the Coffee Report and Outlook (CRO). To download the full CRO or for more information, visit the ICO website: icocoffee.org.

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Green Coffee Summit is a virtual platform that offers insights into the world of coffee production, trade, and value discovery. In an ever-evolving landscape, staying ahead of the curve with current developments in the industry is essential, and attendees can look forward to expert discussions on production forecasts, market trends, and the ever-changing legislative landscape. Discover answers to critical questions such as: What are the emerging consumer preferences? Which flavour profiles dominate key producing regions? Where do the strongest markets lie? These insights are essential for anyone involved in the buying and selling of coffee, whether you’re a seasoned industry professional or just starting out.

With its mission to create a space for producers, traders, and green coffee buyers to access reliable, actionable knowledge about specialty coffee markets, the Green Coffee Summit has proffered information since its programme and resource library launch in August 2021. All content from the December live event will be recorded and added to the Green Coffee Summit library alongside past sessions.

SCA sustainability director and content lead on this year’s event, Andrés Montenegro, said, “In recent years, our perception of green coffee’s value has shifted significantly, with a growing emphasis on extrinsic qualities.

The research on understanding flavour attributes in coffee is evolving rapidly due to market changes, scientific progress, and shifting consumer preferences in the specialty coffee sector. Green Coffee Summit 2023 is a unique chance to get the pulse on these innovations and learn from the leading experts and coffee professionals that are shaping the strategies to advance the specialty coffee sector to make coffee better, for all.”

The upcoming Green Coffee Summit promises to be an even more immersive and enlightening experience, offering attendees the opportunity to connect with industry experts, network with like-minded individuals, and uncover the latest trends and innovations in the world of green coffee.

Save the date for the Green Coffee Summit and join us in advancing the specialty coffee industry’s knowledge, transparency, and growth.

Learn more about the Green Coffee Summit at green.sca.coffee.

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The International Coffee Organization (ICO) reported that world coffee consumption increased by 4.2 percent to 175.6 million bags (60kg) in c offee year 2021/22 and by a further 1.7 percent to 178.3 million bags in 2022/23.

This increase in consumption, the ICO noted, is expected to trigger another year of deficit in the world market with an estimated shortfall of 7.3 million bags in coffee year 2022/23.

According to the ICO, Africa and Asia and Oceania’s consumption would expand by the most, increasing by 4.1 percent and 3.1 percent to 13.4 million bags and 44.2 million bags respectively. The two regions’ shares of world coffee consumption would, as a result, grow to 7.5 percent and 24.7 percent, respectively.

As consumption grows, coffee producers are endeavouring to sustain or improve the flavour of their coffee, especially during the post-harvest processing phase to satisfy the taste and volume demand of consumers. One of the trends that has recently gained traction among coffee producers is co-fermentation of coffee.

Image: Lucia Solis

What is Coffee Co-Fermentation?

US-based green coffee company, Ally Coffee, which connects roasters with specialty coffees sourced through sustainable partnerships, said these co-fermented coffees “offer distinct cup profiles defined greatly by added flavour agents in the fermentation process, imparting difficult-if-not-impossible to achieve flavours to the coffee.”

Ally Coffee, through its Ally Open, a platform for roasters to purchase a curated selection of mall-box specialty green coffee, said some of the coffee producers complete the processing of their crop with little-to-no additives leaving the fermentation process to the naturally occurring microbes and sugars from the coffee cherries.

However, there are others who “have adopted the use of extra ingredients during processing to achieve a number of results including batch consistency, labour efficiency, and differentiated flavour profiles.”

Co-fermentation, explained Joseph Rivera, senior research scientist at Ireland-based public food company, Kerry Group, is an emerging trend that could give coffee farmers control over their coffee fermentation “by intentionally infusing commercially available yeasts, such as Saccharomyces cerevisiae, commonly used in wine and baking to allow a more uniform colonisation of microbes in their tanks.”

Moreover, there is an increasing interest in co-fermenting coffee with fruits and spices such as orange peels, peaches, pineapples, cinnamon, and hops, among other additives.

“The addition of these non-coffee products alters the natural biome in the fermentation tank, introducing new flavours compounds such as terpenes, oils, ester, to ultimately create more complex flavours than traditional coffee fermentations,” added Rivera.

The putting of additives in the fermentation tank/bag, stated Vietnam’s processing and export firm, Helena Coffee, “will help control fermentation by providing sugar for existing microorganisms.” Furthermore, “it also enriches the microflora of the solution or changes its pH and thus regulates the type of microorganisms that will be active during the fermentation process,” Helena stated in a blog.

The co-fermentation process begins soon after harvesting of the coffee with farmers utilising either the washed or dry post-harvest process.

In the washed coffee, the coffee cherry is mechanically de-pulped thus removing the outer layer of skin or exocarp and exposes the encased coffee bean. The encasing of a thin sticky layer of mucilage must be removed to release the bean or endosperm locked inside the cherry.

The conventional method of removing the mucilage is placing the de-pulped coffee into a tank of water and allowing it to sit for 8-24 hours and in some extreme cases, up to 72 hours, explained Rivera. “Due to the presence of yeasts and bacteria naturally found on the surface of the cherry, the tank becomes inoculated whereby microbes begin to consume the sugar in the solution to create a wide host of acids, aldehydes and esters, hence driving the pH of the surrounding solution down and, along with the
pectinases, help dissolve the sticky mucilage off de-pulped coffee.”

Co-Fermented Coffee Challenges

The potential of allergens in co-fermented coffee has dominated discussion within the coffee industry, with some stakeholders suggesting more transparency when it comes to labelling co-fermented coffee.

“For the most part, co-fermenting does not introduce allergens into the fermentation stage,” said Rivera, “however, there have been reports of farmers experimenting with co-fermenting with ‘milk’ (here I’m broadly speaking of cow’s milk, but can also include almond, coconut, soy).”

There is a possibility, he added, of the non- coffee additives introducing allergens, although these novel fermentations have generally been confined to small scale research and development experiments.

Even if there were allergens, such as lactose and nut proteins present in the coffee, “we need to remember that coffee is roasted to ~200-250°C (~392- 482° F) during roasting, which effectively provides a potent ‘kill-step’ thereby rendering any, if not all, of any allergens inactive,” Rivera reminded.

The lack of consensus on allergens in co-fermented coffee is an indicator of existing concerns within the coffee industry that need to be addressed to ensure the safety of coffee
consumers.

Elsewhere, there exists a vacuum when it comes to approved standards on the labelling of co-fermented coffee that makes achieving transparency more challenging. But even then, some in the coffee sector are pushing for a little more clarity on all ingredients in co-fermented coffee.

“The Specialty Coffee Association (SCA), a non- legal organisation, has stated that co-fermented coffees will not be allowed in the barista competitions and must be clearly labelled if a non-coffee product has been added,” Riviera shared. He cited the most recent World Barista Competition rules and regulations which rule out coffee having any “additives, flavourings, colourings, perfumes, aromatic substances, liquids, powders, etc, of any kind added at any point between the time the coffee is picked (as cherry) to when it is extracted into beverage.”

Rivera said that these are just recommendations for now, but “we could see a push to legally define
labelling requirements and standards of identity for these emerging novel coffees in the future.”

However, the position by many coffee roasters further down the supply chain is that co-fermented coffees “should be clearly labelled if any non-coffee additives have been added for both safety and transparency.”

For example, the National Coffee Association of the United States said that due to the various
formulations, flavours, and preparation methods, coffee has become more complex, making labelling
“very complicated.” In many consuming markets, including the US, failure to label coffee properly “can lead to recalls that can impact your bottom line, your brand – and even pose a threat to your
customers.”

With global coffee consumption growing, more coffee producers, roasters and even foodservice
providers are expected to be more innovative in improving the flavours of the coffee cup with
co-fermentation probably becoming a major feature in post-harvest processes but more likely in a more regularised environment.

• Shem Oirere is a freelance business journalist based in Nairobi, Kenya. He has spent more than 25 years covering various sectors of Africa’s economy including the region’s agribusiness. He holds BA in InternationalRelations and Diplomacy from the University of South Africa and earned a higher degree in journalism from the London School of Journalism and is also a member of the Association of Business Executives (ABE).

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Green Coffee Price
The ICO Composite Indicator Price (I-CIP) averaged 153.13 US cents/lb in September, posting a median value of 152.74 US cents/lb and fluctuating between 147.86 and 160.17 US cents/lb.

The Robustas remained at a near-record high in September, staying firmly above the 120.00 US cents/lb mark. The Colombian Milds and Other Milds decreased by 1.4% and 1.7%, to 184.98 and 183.52 US cents/lb, respectively, in September 2023. The Brazilian Naturals and Robustas both contracted by 0.3% and 0.6%, reaching an average of 154.19 and 123.89 US cents/lb, respectively. ICE’s New York market fell by 1.9%, whilst the London Futures market shrank by 2.0%, to 153.55 and 109.14 US cents/lb, respectively.

The Colombian Milds-Other Milds differential grew 79.1% to 1.46 US cents/lb. The Colombian Milds-Brazilian Naturals differential shrank 6.4% to 30.79 US cents/lb, whilst the Colombian Milds-Robustas differential also contracted 2.9% from August to September 2023, averaging 61.09 US cents/lb. Meanwhile, the Other Milds-Brazilian Naturals and the Other Milds-Robustas both contracted 8.6 and 4.0%, reaching 29.33 and 59.63 US cents/lb, respectively. However, the Brazilian Naturals-Robustas differentials expanded 0.9%, averaging 30.30 US cents/lb in September 2023.

In September 2023, the Colombian Milds-Other Milds Arabica differential fluctuated between positive and negative.

Arbitrage, as measured between the London and New York Futures markets, narrowed by 1.8% to 44.41 US cents/lb in September 2023. This marks the lowest point since October 2019, when arbitrage sat at 44.07 US cents/lb.

Intra-day volatility of the I-CIP followed a consistent downtrend, reaching 6.3%, a 0.7 percentage point decrease between August and September 2023. The Robustas presented the strongest volatility decrease, with a 1.3 percentage point drop, averaging 7.4% for the month of September. The Colombian Milds’ and Other Milds’ volatility also contracted to 6.5% and 6.8%. Meanwhile, the Brazilian Naturals’ volatility dropped by 0.7 percentage points to 8.1% from August to September 2023, whilst the London futures market’s volatility also decreased by 2.1 to 7.3%. Lastly, the New York futures market’s volatility moved in the same direction as London, retracting by 0.9 percentage points and reaching 7.7% for New York.

The New York and London certified stocks moved in opposite directions, where London grew 25.7% to 0.73 million 60-kg bags, whilst certified stocks of Arabica coffee reached 0.49 million 60-kg bags, a 13.8% decrease.

The absence of market participants, as evidenced by the falling exports (see Exports by Coffee Groups – Green Beans), continued to prevail over the I-CIP, explaining the overarching trajectory of the I-CIP in September. However, currency movements, market sentiments, dwindling supplies, weather and the fundamentals all played their part in the coffee price movements in September, which saw the I-CIP rally, before falling once again due to foreign exchange movements.

From 22 August to 19 September 2023, the I-CIP recovered, increasing from a low of 148.79 to 160.17 US Cents/lb, ie, an increase of 7.6%. This came on the back of reports of heavy rain in Brazil and a continued fall in the certified stocks held at the New York ICE warehouses. Somar Meteorologia, a Brazilian meteorology company, reported on 5 September that Brazil’s Minas Gerais region, the country’s largest coffee producing region, received 22.8 mm of rain in the past week, or 308% of the historical average, leading to speculation regarding a delay in the completion of Brazil’s coffee harvest. Meanwhile, ICE’s Arabica inventories fell to a low of 0.49 million bags in September. The impact of these positive factors was more profound on the prices of the Arabicas, particularly the Brazilian Naturals which rallied by 5.3% and 81.%, respectively.

Nevertheless, this rally was halted and reversed by the sharp weakening of the real against the US dollar. From 19 to 29 September the real depreciated by 3.2%, from 4.87 to 5.03, while the I-CIP fell by 7.1% over the same period. Once again, the negative impact was felt relatively more by the Arabicas (-8.1%) and particularly the Brazilian Naturals (-9.3%) as compared with Robustas (-5.9%). The price of the Robustas fell at a relatively slower rate due to Vietnam’s current dwindling supply (see Exports by Regions – All Forms of Coffee), with supply from the 2023/24 harvest still at least two months away in November at the earliest.

Exports by Coffee Groups – Green Beans
Global green bean exports in August 2023 totalled 9.36 million bags, as compared with 9.07 million bags in the same month of the previous year, up 3.2%. As a result, the cumulative total for 2022/23 to August is 102.9 million bags, as compared with 108.26 million bags over the same period a year ago, down 5.0%.

Shipments of the Other Milds decreased by 9.7% in August 2023 to 1.99 million bags from 2.2 million bags in the same period last year. As a result, the cumulative volume of exports continued to fall, decreasing by 12.2% in the first 11 months of coffee year 2022/23 to 20.56 million bags, versus 23.42 million bags over the same period in 2021/22.

Green bean exports of the Brazilian Naturals increased in August 2023, rising by 10.2% to 3.06 million bags. For the first 11 months of coffee year 2022/23, green bean exports of the Brazilian Naturals amounted to 31.5 million bags, down 8.0% from 34.22 million bags over the same period a year ago. Changes to the fortunes of the Brazilian Naturals are mainly due to changes in Brazil’s total green bean exports, the biggest producer and exporter of the Brazilian Naturals, which also increased in August 2023 (27.6%) to 3.35 million bags from 2.63 million bags in August 2022.

Exports of the Colombian Milds decreased by 2.1% to 0.84 million bags in August 2023 from 0.86 million bags in August 2022, driven primarily by Colombia, the main origin of this group of coffee, whose exports of green beans were down 5.6% in August 2023. This is the fourteenth consecutive month of negative growth for the Colombian Milds and, as a result, the exports of this group of coffee for October 2022 to August 2023 were down 12.5%, at 9.9 million bags, as compared with 11.32 million bags in the first 11 months of coffee year 2021/22.

Green bean exports of the Robustas amounted to 3.47 million bags in August 2023, as compared with 3.22 million bags in August 2022, up 7.3%. This is the fifth consecutive month of positive growth for the Robustas and, as a result, the exports of this group of coffee for October 2022 to August 2023 were up 4.2%, at 40.94 million bags, as compared with 39.31 million bags in the first 11 months of coffee year 2021/22.

Exports by Regions – All Forms of Coffee
In August 2023, South America’s exports of all forms of coffee increased by 13.0% to 4.98 million bags. This is the first positive growth rate for the region since the 0.3% expansion in June 2022. The source of both the positive and strength of growth is Brazil, which saw its exports increase by 24.4% to 3.67 million bags from 2.95 million bags in August 2022. More specifically, it was the Robustas from the origin, which in August increased by 388.1% to 0.7 million bags from 0.14 million bags, that drove the region’s positive growth. The August 2023 exports are Brazil’s highest on record for Robusta coffee, beating the 696,873 bags exported in December 2014.

Fundamentally, the region’s turnaround is due to the recent downturn in Asia and Oceania, especially in Vietnam, the world’s largest Robusta producer and exporter. Pointedly, Brazil is the largest producer and exporter of Robustas in South America, and it has been taking advantage of the reduced volume of Robustas coming out of Vietnam. It is pertinent to note that Brazil is the fifth biggest exporter of Robustas in the world, having shipped 1.87 million bags in coffee year 2021/22 as compared with the 25.44 million bags exported from Vietnam or the 4.89 million, 4.28 million and 4.03 million bags from Uganda, India and Indonesia, respectively, the second, third and fourth largest exporters. However, in August 2023, Brazilian Robusta exports were second only to Vietnam with 1.34 million bags. To put this into perspective, in August 2023 Brazil exported the equivalent of four-and-half months’ worth of Robustas in a single month (as measured against the total Robusta exports in coffee year 2021/22).

Exports of all forms of coffee from Africa increased by 10.9% to 1.37 million bags in August 2023 from 1.23 million bags in August 2022. For the first 11 months of the current coffee year, exports totalled 10.84 million bags as compared with 12.31 million bags in coffee year 2021/22, down 1.5%. This is the third consecutive month of positive growth rate for the region. The continued global demand for Robustas, as reflected in the latest cumulative positive growth rates for Robusta green bean exports, is the fundamental source of Africa’s positive export growth rate in August. However, like the situation in South America, the reduced volume from the Asia and Pacific region, and more pointedly Vietnam, explains this growth.

Uganda, the largest producer and exporter of Robusta coffee in Africa, took the opportunity to fill the gap in the market left by Vietnam, increasing its exports by 48.4% to 0.74 million bags in August 2023 from 0.5 million bags in August 2022. This represents the second largest monthly exports on record, just behind the 0.79 million bags exported in March 1973.

In August 2023, exports of all forms of coffee from Mexico and Central America were down 2.0% to 1.23 million bags as compared with 1.26 million in August 2022. As a result, total exports are down 2.6% from October 2022 to August 2023 at 14.57 million bags, as compared with 14.96 million bags for the same period a year ago. The relatively shallow negative growth rate of the region masked the dynamic changes at the individual country level.

Two origins experienced strong positive growth rates (Honduras and Nicaragua), with a combined 37.2% increase in August 2023, while three others experienced sharp negative growth rates (Costa Rica, Guatemala and Mexico), with a combined 20.5% decrease. Honduras and Nicaragua outperformed both the region and group of coffee (Other Milds) to which they predominantly belong in August. This may reflect their competitive edge over other origins in Mexico and Central America – the average export unit value of Arabica green beans for Honduras and Nicaragua was 157 US cents/lb for coffee years 2017/18–2021/22, while it was on average 63 US cents/lb higher for the others (excluding Cuba, Haiti and Jamaica) at 220 US cents/lb.

Exports of all forms of coffee from Asia and Oceania decreased by 14.9% to 2.72 million bags in August 2023 and but were up 1.3% to 41.28 million bags in the first 11 months of coffee year 2022/23. August’s downturn was mainly due to Vietnam, with exports down 23.6% to 1.44 million bags from 1.98 million bags. This is the lowest month of August exports since the 1.4 million bags shipped in 2012. The decrease can be attributed to the depletion of available supply, reflecting the strength of its exports in the first 10 month of the current coffee year, where between October 2022 and July 2023 Vietnam shipped 25.98 million bags –3.3% higher than the same period in coffee year 2017/18, a record exporting year when the origin shipped 29.73 million bags over the full year.

Exports of Coffee by Forms
Total exports of soluble coffee decreased by 4.6% in August 2023 to 0.89 million bags from 9.3 million bags in August 2022. In the first 11 months of coffee year 2022/23, a total of 10.46 million bags of soluble coffee were exported, representing a decrease of 5.7% from the 11.09 million bags exported in the same period during the previous coffee year.

Soluble coffee’s share in the total exports of all forms of coffee for the year to date was 8.6% in August 2023, down from 9.2% for the same period a year ago. Brazil is the largest exporter of soluble coffee, having shipped 0.32 million bags in August 2023.

Exports of roasted beans were down 39.9% in August 2023 to 58,226 bags, as compared with 96,937 bags in August 2022. The cumulative total for coffee year 2022/23 to June 2023 was 0.66 million bags, as compared with 0.77 million bags in same period a year ago.

Production and Consumption
Under the current circumstances, the estimates and outlook of production and consumption for coffee years 2021/22 and 2022/23 remain the same.

World coffee production decreased by 1.4% to 168.5 million bags in coffee year 2021/22, hampered by the off-biennial production and negative meteorological conditions in a number of key origins. However, it is expected to bounce back by 1.7% to 171.3 million bags in 2022/23. Increased global fertiliser costs and adverse weather conditions are expected to partially offset the positive impact of biennial production from Brazil, explaining the relatively low rate of growth in coffee year 2022/23. The impact of biennial production is anticipated to drive the outlook for Arabica, which is projected to increase by 4.6% to 98.6 million bags in coffee year 2022/23, following a 7.2% decrease in the previous coffee year.

Reflecting its cyclical output, Arabica’s share of the total coffee production is expected to increase to 57.5% from 55.9% in coffee year 2021/22. South America is and will remain the largest producer of coffee in the world, despite suffering from the largest drop in output for almost 20 years, which fell by 7.6% in coffee year 2021/22. The recovery in coffee year 2022/23, partly driven by biennial production, is expected to push the region’s output to 82.4 million bags, a rise of 6.2%.

World coffee consumption increased by 4.2% to 175.6 million bags in coffee year 2021/22, following a 0.6% rise the previous year. Release of the pent-up demand built up during the Covid-19 years and sharp global economic growth of 6.0% in 2021 explains the sharp bounce back in coffee consumption in coffee year 2021/22. Decelerating world economic growth rates for 2022 and 2023, coupled with the dramatic rise in the cost of living, will have an impact on the coffee consumption for coffee year 2022/23. It is expected to grow, but at a decelerating rate of 1.7% to 178.5 million bags. The global deceleration is expected to come from non-producing countries, with Europe’s coffee consumption predicted to suffer the largest decrease among all regions, with growth rates falling to 0.1% in coffee year 2022/23 from a 6.0% expansion in coffee year 2021/22.

As a result, the world coffee market is expected to run another year of deficit, a shortfall of 7.3 million bags.

The outlook is taken from the newest publication of the Statistics Section of the Secretariat of the International Coffee Organization (ICO), the Coffee Report and Outlook (CRO). The full CRO can be downloaded from the ICO website: icocoffee.org. For further information, contact the Statistics Section at stats@ico.org.

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Production changes

Over the last three months there have not been many changes to production, but significant changes to demand. Rabobank estimates coffee production at 163.7m bags in 2022/23 and at 172.6m bags in 2023/24. The global deficit in 2022/23 is now estimated at -5.7m bags (a reduction of 0.7m bags, mainly due to demand dropping more than production), while a neutral balance is projected for 2023/24, with a surplus in arabicas and a deficit in robustas.

Global coffee balance. Image: Rabobank

Brazil’s export pace has been accelerating, especially in conillons. While green arabica exports were expected to go up in August given that the early harvest was ready to be exported, the strength of green conillon exports was probably more surprising to the market: July exports were up +109 percent vs June, and preliminary August exports remained strong. In our view, this was to be expected given two consecutive large conillon crops and the increased domestic availability of arabicas in the current harvest. The current local arbitrage in Brazil simply does not incentivise maximising the conillon share of demand going forward, freeing up more conillon for the international market. It is a delicate time to make output predictions in Brazil for next year, but an increase in production is expected.

We also expect some production recovery in Colombia 2023/24, but it will probably be gradual. Cost of production has been increasing and farmers are getting half of what they were receiving a year ago (in COP). The weather in 2023 has improved but it has not been ideal, leading to an initial estimate of 12.5m bags in 2023/24 (following around 10.5m bags in 2022/23). Honduran coffee sales are 14 percent higher so far this season YoY, which means that even our previously optimistic prediction of a 10 percent increase in production in the last harvest (2022/23) is proving to be falling short, and we are increasing our estimate slightly. Exports from other countries in Central America are significantly less optimistic. It is very early to make predictions for Central America in 2023/24, but the end of La Niña is usually favourable.

Image: Vanessa L Facenda

The robusta rally was quashed by the collapse in arabica prices since June. However, there are still concerns about the availability of robusta. El Niño-related dryness is becoming more frequent in parts of Southeast Asia, including some areas of Indonesia and Vietnam, Laos, much of Thailand and parts of India. In key producer Vietnam, the main robusta regions still seem to be getting decent rainfall, but the arabica areas in the north look dry. Our expectation for Vietnam 2023/24 has recently been marginally revised lower to 29m bags of total coffee (similar to 2022/23). We have been making small downward adjustments to production estimates across the region.

Coffee demand

Import demand figures were very gloomy throughout 1H 2023. In the second quarter of 2023, net imports into the European Union + United Kingdom collapsed 13.4 percent versus a year ago, while in the United States they were down 9.6 percent. Japan’s coffee disappearance in the quarter was largely unchanged YoY. We can track other 24 non-producing countries, where the drop in net imports in Q2 was 2.9 percent YoY. Globally, the drop for Q2 was 9.4 percent YoY. This is worse than a very poor Q1, and it is in fact, the largest drop we can track in our data going back to 2008. In the 12 months to June 2023, the annual drop in all non-producing countries that we can track was 2.2 percent.

As we have been pointing out for most of last year, the rise in interest rates should have led to a decline in inventories along the pipeline. Roasters and traders also feel more confident that container shipping is working much more normally, so there is no need to keep stocks ‘just in case’. However, these results are worse than expected and lead to a reduction in global demand growth to virtually zero percent in non-producing countries, while producing country demand might still grow at over one percent.

The rather low arbitrage (at around USD $0.40 at the time of writing) should lead to a comeback in arabica demand. This is particularly the case in producing countries (and Brazil in particular), where there is usually a surplus of low quality arabica grades as subproduct of the export business.

Image: Vanessa L Facenda

Price drivers

An expected recovery in both Brazil and Colombia in 2023/24, combined with weak demand, continues to put downward pressure on the market in the absence of more adverse weather or news. This is exacerbated by the prospect of a recession in the EU. Yet we are not far from cost of production in a number of arabica-producing countries. The rainfall pattern in the Brazilian arabica belt will, as usual, be the focus of the market over September and October.

If the idea of a bumper arabica crop in Brazil in the coming year is reinforced not only by good rainfall, but also by good flowering and actual fixing of flowers and pinheads through November, then there is a chance that speculators will start selling arabica futures with more conviction and prices could move lower and closer or even below cost of production, which is roughly estimated at USc 140/lb. But in the short term, any variation in the weather pattern in Brazil (weather hardly ever is perfect) and a very probable improvement in import demand in Q3 are likely to offer support to prices.

Meanwhile, speculators in the robusta market will continue to focus on potential El Niño-related effects. As El Niño is expected to last until at least the end of Q1 2023, speculators will likely stick around for the remainder of the year. Concerns over the EU Deforestation Regulation could also mean that some robusta produced before mid-2023 is carried into 2025 (at a tremendous cost). On the arabica front, this is less likely, as arabicas would lose more value over time.

• Within RaboResearch Global Economics & Markets, Carlos Mera serves as the head of the agri-commodities markets team in London. Previously, Mera worked at Rabobank as a senior commodities analyst with a focus on coffee and cocoa. Prior to joining Rabobank, he worked at Neumann Kaffee Group where he conducted coffee market research for more than seven years. Mera holds a Master of Finance from the London School of Economics and a Bachelor of Economics from the University of Buenos Aires. He may be reached at: carlos.mera@rabobank.com. With over 140 analysts around the globe, RaboResearch covers topics related to economics, global financial markets as well food and agribusiness. For more information on RaboResearch, visit: rabobank.com/en/research.

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The ICO Composite Indicator Price (I-CIP) averaged 154.53 US cents/lb in August, posting a median value of 152.10 US cents/lb and fluctuating between 148.79 and 163.62 US cents/lb.

The Colombian Milds-Other Milds decreased by 1.6% and 3.5%, to 187.55 and 186.73 US cents/lb, respectively, in August 2023. Accentuated by a greater falling rate, the Other Milds fell back below the Colombian Milds. The Brazilian Naturals-Robustas both contracted by 3.0% and 2.3%, reaching an average of 154.66 and 124.62 US cents/lb, respectively. ICE’s New York market fell by 1.9%, whilst the London Futures market shrank by 2.0 % to 156.56 and 111.34 US cents/lb, respectively.

The Colombian Milds-Other Milds differential pivoted from –2.91 to 0.82 US cents/lb, returning to the positive after an inverted differential in July 2023. On the one hand, the Colombian Milds-Brazilian Naturals differential grew 5.8% to 32.89 US cents/lb, whilst the Colombian Milds-Robustas differential contracted 0.1% from July to August 2023, averaging 62.93 US cents/lb. Meanwhile, the Other Milds-Brazilian Naturals, Other Milds-Robustas and Brazilian Naturals-Robustas differentials contracted by 5.7, 5.8 and 5.9%, reaching 32.07, 62.11 and 30.04 US cents/lb, respectively.

In August 2023, the Colombian Milds-Other Milds Arabica differential had been narrowing considerably and, after thirty-four business days of negative differentials, this trend was reversed on 10th August. The Colombian Milds-Other Milds Arabica differential closed August on a one-month high, though it has not reached such positive lows in four and a half years. In late July and August 2023, the Arabicas-Robusta price movements recoupled, moving once again in tandem. Since April 2023, the price movements of the Arabicas and Robusta were decoupled under price substitution-related pressure, where demand for higher-end qualities has waned in favour of more competitively-priced coffees. However, the recoupling appears to indicate that the price differentials are now sufficiently narrow, and relative price-driven changes in demand (Arabica versus Robusta) may have come to an end.

Arbitrage, as measured between the London and New York Futures markets, narrowed by 1.6% to 45.23 US cents/lb in August 2023. This marks the lowest point since June 2020, where arbitrage sat at 44.73 US cents/lb.

Intra-day volatility of the I-CIP followed a consistent downtrend, reaching 7.0%, a 0.8 percentage point decrease between July and August 2023. The Other Milds presented the strongest volatility decrease, with a 3.7 percentage point drop, averaging 7.3% for the month of August. The Colombian Milds’ and Brazilian Naturals’ volatility also contracted to 7.5% and 8.8%. Meanwhile, the Robustas’ volatility dropped by 2.3 percentage points to 8.7% from July to August 2023, whilst the London futures market’s volatility increased by 0.2 to 9.4%. However, the New York futures market’s volatility moved in the opposite direction from London, retracting by 0.5 percentage points and reaching 8.6% for New York.

The New York and London certified stocks decreased in tandem by 3.0% and 34.6%, respectively, closing in at 0.57 million 60-kg bags, whilst certified stocks of Robusta coffee reached 0.58 million 60-kg bags, the lowest in over 20 years.

Downward pressure on prices could be attributed to the lack of aggressive buying of green coffee through the world. Indeed, for the current and previous coffee years (2021/22 and 2022/23), a combined underproduction of 14.4 million 60-kg bags is estimated. At present, there is an apparent decoupling between consumption and exports. There is little evidence of the former falling, while the latter for the current coffee year is down 5.7%. A plausible explanation could be the drawing down of stocks. During the Covid-19 pandemic, buyers, roasters and traders would have built up large stocks of coffee that must now be utilised before they perish. This may help to explain why exports are falling, coffee year on coffee year, thus applying negative pressure on the I-CIP. The broad drawdown of stocks is perhaps, further illustrated by the historic lows of the ICE stocks.

Exports by Coffee Groups – Green Beans
Global green bean exports in July 2023 totalled 9.31 million bags, as compared with 9.3 million bags in the same month of the previous year, up 0.1%. As a result, the cumulative total for 2022/23 to July is 93.56 million bags versus 99.2 million bags over the same period a year ago, down 5.7%.

Shipments of the Other Milds decreased by 13.7% in July 2023 to 2.20 million bags from 2.55 million bags in the same period last year. As a result, the cumulative volume of exports continued to fall, decreasing by 12.2% in the first 10 months of coffee year 2022/23 to 18.64 million bags versus 21.22 million bags over the same period in 2021/22.

Green bean exports of the Brazilian Naturals increased in July 2023, rising by 2.8% to 2.6 million bags. For the first 10 months of coffee year 2022/23, green bean exports of the Brazilian Naturals amounted to 28.4 million bags, down 9.7% from 31.45 million bags over the same period a year ago. Changes to the fortunes of the Brazilian Naturals are mainly due to changes in Brazil’s total green bean exports, the biggest producer and exporter of the Brazilian Naturals, which also increased in July 2023 (10.8%) to 2.7 million bags from 2.43 million bags in July 2022.

Exports of the Colombian Milds decreased by 8.1% to 0.93 million bags in July 2023 from 1.01 million bags in July 2022, driven primarily by Colombia, the main origin of this group of coffee, whose exports of green beans were down 16.0% in July 2023. This is the thirteenth consecutive month of negative growth for the Colombian Milds and, as a result, the exports of this group of coffee for October 2022 to July 2023 were down 12.9%, at 9.11 million bags from 10.46 million bags in the first 10 months of coffee year 2021/22.

Green bean exports of the Robustas amounted to 3.59 million bags in July 2023, as compared with 3.22 million bags in July 2022, up 11.6%. This is the fourth consecutive month of positive growth for the Robustas and, as a result, the exports of this group of coffee for October 2022 to July 2023 were up 3.8%, at 37.45 million bags, as compared with 36.08 million bags in the first 10 months of coffee year 2021/22.

Exports by Regions – All Forms of Coffee
In July 2023, South America’s exports of all forms of coffee decreased by 2.2% to 4.16 million bags, mainly driven by Colombia and Peru, which saw their exports fall by 17.1% and 37.5%, respectively. For Colombia, the latest downturn is the thirteenth consecutive month of negative growth, the second longest since the 22-month long streak observed between July 2008 and March 2010. As a result, Colombia’s exports for the first 10 months of coffee year 2022/23 are down to 8.79 million bags, the lowest level over the same 10-month period since coffee year 2012/13, when 7.24 million bags of coffee were shipped from the origin. Issues with local production, caused by meteorological factors, were the reason behind the downturn in exports for much of the current coffee year.

However, since June 2023, price substitution appears to be the main driver of the downturn in exports, with demand switching between the Arabicas, away from the Colombian Milds, of which Colombia is the largest producer, to the Other Milds. In Peru, the weather also played a part in the sharp decrease in exports. The Peruvian National Institute of Statistics and Informatics (INEI) reported that increased rainfall was behind the 1.9% decrease in production in June 2023, which may have filtered through to exports as a reduced availability of supply. However, the magnitude of the decrease in July 2023 is a more reflection of the 64.7% increase in July 2022 – the largest volume of July exports in the last 10 years (0.4 million bags versus an average 0.34 million bags (2013-2022)).

Exports of all forms of coffee from Africa decreased by 1.1% to 1.37 million bags in July 2023 from 1.39 million bags in July 2022. For the first 10 months of the current coffee year, exports totalled 10.84 million bags as compared with 11.27 million bags in coffee year 2021/22, down 3.8%. Once again, however, the relatively shallow negative growth rate of the region masked the dynamic changes at the individual country level. Two origins experienced strong positive growth rates (Tanzania and Uganda), with a combined 23.6% increase in July 2023, while two others experienced sharp negative growth rates (Côte d’Ivoire and Ethiopia), with a combined 26.7% decrease. In Ethiopia, contract disputes arising out of a mismatch between the local purchasing prices and the global market prices continue to negatively impact the volume exports, with exporters withholding the coffee until the disputes are resolved. Uganda’s exports increased by 12.0% in July, which were driven by a good crop harvest in South-Western region, and exporters releasing their stocks.

In July 2023, exports of all forms of coffee from Mexico and Central America were up 9.4% to 1.66 million bags as compared with 1.51 million in July 2022. As a result, total exports are down 1.8% for October 2022-July 2023 at 13.46 million bags, as compared with 13.71 million bags in the same period a year ago. Honduras was the main driver of the positive growth in July 2023.

Exports of all forms of coffee from Asia and Oceania decreased by 6.2% to 3.01 million bags in July 2023 and but were up 2.7% to 38.57 million bags in the first 10 months of coffee year 2022/23. July’s downturn was due to the top four origins of the region, India (-3.5%), Indonesia (-9.7%), Papua New Guinea (-25.9%) and Vietnam (5.1%).

Exports of Coffee by Forms
Total exports of soluble coffee decreased by 16.6% in July 2023 to 0.84 million bags from 1.0 million bags in July 2022. In the first 10 months of coffee year 2022/23, a total of 9.58 million bags of soluble coffee were exported, representing a decrease of 5.7% from the 10.16 million bags exported in the same period during the previous coffee year. Soluble coffee’s share in the total exports of all forms of coffee for the year to date was 9.2% in July 2023, which matched the year-ago period. Brazil is the largest exporter of soluble coffee, shipping 0.31 million bags in July 2023.

Exports of roasted beans were down 12.7% in July 2023 to 57,299 bags, as compared with 65,601 bags in July 2022. The cumulative total for coffee year 2022/23 to June 2023 was 0.6 million bags, as compared with 0.67 million bags in same period a year ago.

Production and Consumption
Under the current circumstances, the estimates and outlook of production and consumption for coffee years 2021/22 and 2022/23 remain the same. World coffee production decreased by 1.4% to 168.5 million bags in coffee year 2021/22, hampered by the off-biennial production and negative meteorological conditions in a number of key origins. However, it is expected to bounce back by 1.7% to 171.3 million bags in 2022/23.

Increased global fertiliser costs and adverse weather conditions are expected to partially offset the positive impact of biennial production from Brazil, explaining the relatively low rate of growth in coffee year 2022/23. The impact of biennial production is anticipated to drive the outlook for Arabica, which is projected to increase by 4.6% to 98.6 million bags in coffee year 2022/23, following a 7.2% decrease in the previous coffee year. Reflecting its cyclical output, Arabica’s share of the total coffee production is expected to increase to 57.5% from 55.9% in coffee year 2021/22. South America is and will remain the largest producer of coffee in the world, despite suffering from the largest drop in output for almost 20 years, which fell by 7.6% in coffee year 2021/22. The recovery in coffee year 2022/23, partly driven by biennial production, is expected to push the region’s output to 82.4 million bags, a rise of 6.2%.

World coffee consumption increased by 4.2% to 175.6 million bags in coffee year 2021/22, following a 0.6% rise the previous year. Release of the pent-up demand built up during the Covid-19 years and sharp global economic growth of 6.0% in 2021 explains the sharp bounce back in coffee consumption in coffee year 2021/22.

Decelerating world economic growth rates for 2022 and 2023, coupled with the dramatic rise in the cost of living, will have an impact on the coffee consumption for coffee year 2022/23. It is expected to grow, but at a decelerating rate of 1.7% to 178.5 million bags. The global deceleration is expected to come from non-producing countries, with Europe’s coffee consumption predicted to suffer the largest decrease among all regions, with growth rates falling to 0.1% in coffee year 2022/23 from a 6.0% expansion in coffee year 2021/22.

As a result, the world coffee market is expected to run another year of deficit, a shortfall of 7.3 million bags.

The outlook is taken from the newest publication of the Statistics Section of the Secretariat of the International Coffee Organization (ICO), the Coffee Report and Outlook (CRO). For the full report, visit: icocoffee.org.

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CropConex is a value chain management platform bringing the coffee trade ecosystem online, with tools to streamline operations and de-risk trade. The platform empowers buyers, sellers, and exporters to grow together, by making value chains traceable, efficient, and accessible. Starting in Ethiopia, this New York based startup seeks to unlock greater efficiency in global trade, increasing access and prosperity for all. Visit the website to learn more.

The CropConex marketplace launched this summer, presenting coffees from reliable Ethiopian suppliers to the North American market in an e-commerce system designed for international agricultural trade. An open marketplace with validated listings, efficient communication, and secure and compliant transactions can build greater confidence in direct trade participation across different sizes and levels of experience in both buyers and sellers.

The digital system tracks every step in the sales and logistics process, from sampling to ordering to delivery, and reports progress in an easy-to-use portal. This workflow enables open communications between suppliers, buyers, and logistics service providers throughout the entire process, cultivating a deeper level of transparency and traceability in the specialty coffee supply chain.

CropConex’s marketplace currently offers:
• A diverse catalog of Ethiopian coffees.
• Access to greater volume flexibility than traditional channels.
• A commercial airline partnership with groundbreaking air-shipping rates from Ethiopia at under USD $1.30/lb.
• Real-time data updates and feedback as coffee moves through the supply chain.
• On-the-ground team presence and quality controls at origin.

How the platform works for coffee buyers:
• Browse the marketplace and request samples for coffees of interest.
• Provide sample feedback and enter price negotiations directly with suppliers.
• Secure contracts, payment and export logistics within the platform.
• Receive quality checks, shipment status updates and final delivery within weeks.

Brianna Dickey, founder and CEO of CropConex, developed the platform to unlock greater access, equitability and economic potential in the international coffee trade market. The company plans to offer education on existing and future ecosystems of trade. They encourage discourse on the distributed rights to growth and the mutual benefits found in collective progress.

Tackling the complexities in current trading between Ethiopia and the United States, CropConex worked with the Ministry of Trade and Regional Integration offices, the Coffee and Tea Authority, the Ministry of Innovation and Technology, and the Ethiopian Investment Commissioner to finalize the legal incorporation of e-commerce into their business registration codes. On 11 November 2022 CropConex was licensed as the first E-Commerce Platform Operator business in the nation. They are working to expand their operation to other countries in the near future.

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This important work is being made possible through cooperation from Continental Terminals, a third-generation, family-owned warehousing company that has been a partner in the coffee value chain for more than 50 years.

US-based roasters can now send their used liners to Continental Terminals locations in Keasbey, NJ, or Alameda, California, via their preferred service (USPS, FedEx, UPS or DHL) or by personal delivery. Once the bags reach a Continental Terminals warehouse, they’ll be prepared to continue their journey to a unique recycling facility.

How it works

Participation is simple:

• Begin by emailing sustainability@grainpro.com saying you’ll be sending bags; an automatic response will offer helpful details and answers to FAQs.
• Next, put clean, empty bags in a box or GrainPro bag; adhere a label addressed to a Continental Terminals location; and apply postage. OR: Bring the bags to one of the warehouse addresses during a coffee pickup.

The warehouse addresses are:

CTI Annex                                        CTI NJ
300 Mitchell Ave                            300 Mac Lane
Alameda, CA 94501                       Keasbey, NJ 08832

“It’s our goal to be a responsible partner and leader in the green coffee industry, which means guiding the way toward improved sustainability,” said Nicolas Rueda, CEO of Neumann Gruppe USA. “We’re delighted to encourage the success of this effort by communicating its availability to our clients and networks.”

Neumann Gruppe USA (NGUS) represents InterAmerican Coffee, Rothfos Corporation and Atlas Coffee Importers, the three US-based import companies of Neumann Kaffee Gruppe. The NGUS companies have long-established relationships with roasters of every size and need across North America, as well as decades-old relationships with coffee producers, cooperatives and associations. Prioritising the future of coffee — via the social, environmental and economic factors impacting it — works in service of NGUS clients on both ends of the supply chain, as well as the NGUS vision to lead with responsibility, respect and an unwavering dedication to the product and people elevated through its best work.

In the near future, GrainPro and Neumann Gruppe USA plan to expand their partnership to similar collection efforts across Europe.

Without question, improving sustainability will require industry-wide approaches and collaborations. GrainPro and Neumann Gruppe USA are hopeful that coffee roasters — true to their passion for coffee and commitment to the environment — will agree to be the essential additional collaborators in this effort and take this powerful step toward a more sustainable tomorrow.

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