Pressure from Brazil, coffee export prices continue to weaken

Positive export figures from Brazil put pressure on coffee export prices Despite improved supply, coffee export prices still increased compared to the reference

According to the Vietnam Commodity Exchange (MXV), at the end of the trading week of February 19-25, coffee prices continued to weaken with a decrease of 3.43% for Arabica and 3.53% for Robusta, respectively. Improvements in supply, combined with exchange rate differences, have put great pressure on prices.

Brazil shipped 127,600 tonnes in the first three weeks of February, up from 122,400 tonnes in the same period last year, the Secretariat for Foreign Trade (Secex) said. Meanwhile, the positive supply outlook for Brazil's 24/25 coffee crop was reinforced when consultancy StoneX raised its forecast for Brazil's 2024 coffee production to 67 million bags, up 4.2% from 2023. Previously, the Cooxupe cooperative also expected output in Minas Gerais, Brazil's main coffee-growing state, to reach 5.5 million bags, up from 5.3 million bags in the previous crop year.

Sức ép nguồn hàng từ Brazil, giá cà phê xuất khẩu tiếp đà suy yếu

Coffee prices continued to weaken with a decrease of 3.43% for Arabica and 3.53% for Robusta.

According to observers, coffee prices continued to decline partly due to strong selling pressure from Brazil - the world's largest coffee producer and exporter, which is about to enter the new harvest of the 2024/2025 crop from April 2024 in Robusta growing areas, followed a few months later by the Arabica harvest with expected increased output. Meanwhile, the country's Real continued to weaken to a two-week low, encouraging Brazilians to boost coffee export sales.

In addition, Vietnam's Robusta coffee exports in January 2024 increased by 67.45% compared to the same period last year, also causing pressure, causing funds to accelerate liquidation, despite concerns about tight supply due to international shipping issues and increasing global demand.

According to experts, the demand to complete orders and pressure on supply have caused coffee prices to exceed VND82,000/kg. The shortage of supply is also forecast to continue to push coffee prices up in the coming time.

Vietnam's Robusta coffee exports in January 2024 increased by 67.45% over the same period last year. Photo baochinhphu.vn

The EU's regulation that coffee entering the market must comply with the EU Deforestation Regulation (EUDR) is also a factor affecting current coffee prices. Because many countries have not yet prepared the procedures to meet the requirements of the EU Deforestation Regulation, while Vietnamese coffee basically meets this requirement, leading to customers giving priority to buying Vietnamese products.

Vietnam's coffee industry had a good start in the first month of 2024 after achieving quite impressive growth last year.

The European Union (EU) continued to be Vietnam's largest coffee export market in the first month of the year. In January 2024, Vietnam's coffee exports to the EU accounted for 37% of the country's total exports, reaching 87,748 tons, with a turnover of 263.18 million USD, up 9.6% in volume and 17.9% in turnover compared to the previous month; up 41.2% in volume and 94.9% in turnover compared to the same period last year.

Specifically, the amount of coffee exported to the Italian market increased sharply by 35.1% compared to December 2023, to Spain by 34.1%; on the contrary, exports to the German market decreased slightly by 3.5%...

For the US market, Vietnam's coffee exports in January 2024 reached 15,123 tons, with a turnover of 44.28 million USD, up 3.4% in volume and 11.5% in value compared to the previous month; up 38.7% in volume and 97.7% in turnover compared to the same period last year.

Notably, coffee exports to the two markets of Russia and Indonesia increased sharply by three digits compared to the previous month. Exports to Russia reached 14,287 tons, with a turnover of 41.39 million USD, up 106.6% in volume and 104.3% in turnover; Indonesia reached 13,695 tons, with a turnover of 44.37 million USD, up 233.1% in volume and 173.7% in turnover.

Coffee exports to several other major markets also recorded positive results compared to the previous month, such as: the US and China increased by more than 3%, especially Russia and Indonesia increased by 106% and 233.1%... On the contrary, exports to Japan, Algeria and South Korea decreased.

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