Good rain in Brazil – Arabica coffee prices falls to a 2-week low
Coffee prices Monday settled mixed, with arabica falling to a 2-week low. Arabica was under pressure Monday on news of abundant rain in Brazil that may promote flowering for next year’s coffee crop. Somar Meteorologia reported Monday that Minas Gerais had 51 mm of rain last week, or 185% of the historical average. Minas Gerais accounts for about 30% of Brazil’s arabica crop.
A decline in the dollar index Monday to a 1-week low provided underlying support for coffee prices.
A bearish factor for robusta coffee is robust supply from Vietnam. Vietnam’s General Department of Customs reported last Thursday that Vietnam’s coffee exports in the nine months through Sep rose +13.7% y/y to 1.35 million metric tons. Vietnam is the world’s biggest producer of robusta coffee beans. The USDA June 7 revised its 2021-22 coffee production estimate for Vietnam upward to 31.58 million bags from 31.1 million bags but said 2022/23 production would fall by -2.2% y/y to 30.9 million bags.