struggle to find ships for Brazil bumper crop

Brazilian coffee exporters are struggling to find shipping capacity to transport a bumper crop from the world’s top producer, which could result in supply delays to roasters worldwide.

Abundant overall supplies in consuming countries, however, will limit any near-term impact from shipping delays of Brazil’s new crop and are not yet seen impacting coffee prices that are 12-year lows.

Farmers in Brazil are finishing what the government and industry expect to amount to a record coffee crop of around 60 million 60-kg bags compared with 45 million bags last year.

Container ships do not have the capacity to immediately take the huge volume of beans that are arriving at top exporting ports such as Santos and Rio de Janeiro, importers and exporters said.

That means exporters, which typically book capacity on container ships one or two weeks in advance, have a wait of up to eight weeks, they say.
Brazil’s coffee exporters association Cecafé said in its latest monthly report that July shipments, which were up 28 per cent from a year prior, could have been even bigger if not for “difficulties at ports”.

This comes after Brazil, Latin America’s largest economy, suffered its deepest recession on record in 2017, which reduced its imports and consequently cut the availability of containers available to be used for exports, importers and exporters said.
Coffee, on the other hand, is shipped in containers, and its transportation pinch is being felt now as Brazil harvests and ships its large 2018/19 crop.

It was not clear if container ship availability will improve in the future as the country’s economy remains sluggish and its imports remain low.

And while Brazilian coffee sales reached 38 per cent of production by Aug 7, which was up from 34 per cent at the same time a year ago according to Safras & Mercado data, arabica coffee prices have since tumbled to 12-year lows below US$1 per lb on pressure from the weak Brazilian currency.
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