How Are Global Coffee Exports Shifting Between Arabica and Robusta?

Global coffee exports rose 4.1 percent year on year in November to 10.61 million bags, and 3.1 percent over October and November to 20.25 million bags, according to the International Coffee Organization. Improved Arabica supply is pushing prices down, while Robusta holds at high levels and has set record highs as drought cuts Vietnamese output.

Vietnam's customs data show full-year 2023 coffee exports fell 9.6 percent, and the agriculture ministry expects the 2023/24 crop to drop about 10 percent, the lowest in nearly four years. Colombia rebounded to 11.3 million bags in 2023, up 2 percent after three declining years. Brazil's Arabica areas saw better rainfall with upward forecast revisions, though its Robusta regions stayed hot and dry.

The global coffee market has recently shown divergent trends. Data from the International Coffee Organization shows that global coffee exports have grown year-on-year, with improved Arabica supply driving prices down, while Robusta prices remain firm and have even hit record highs due to drought in Vietnam and persistently tight supply. Colombia's production has rebounded after three years of decline, and Brazil's Arabica-producing regions have seen improved rainfall with production forecasts revised upward, but the Robusta-producing regions have experienced high temperatures and little rain, so subsequent production remains to be seen. This article will review the specific data and weather impacts in the three major producing regions of Vietnam, Colombia, and Brazil to help coffee enthusiasts understand the supply and demand logic behind current price fluctuations.

A recent Reuters report noted that Vietnam is facing drought conditions, and coffee production is expected to decline. At the same time, Brazil's rainfall forecast for next week is relatively optimistic, Arabica coffee production is trending upward, and prices will fall accordingly. In addition, Colombia's 2023 production rebounded, ending the previous three consecutive years of decline caused by weaker rainfall.

A report released by the International Coffee Organization (ICO) shows that global coffee exports in November increased 4.1% year-on-year to 10.61 million bags; from October to November, coffee exports increased 3.1% year-on-year to 20.25 million bags. Thereafter, growth in global Arabica coffee supply will drive prices lower. However, Robusta coffee supply remains tight, and its price continues to stay at a relatively high level.

Vietnam

The current tight Robusta supply situation means prices will remain high and may continue to climb. This has also caused recent Robusta coffee prices to set a record high. A report from Vietnam's General Department of Customs shows that Vietnam's coffee exports for the full year of 2023 fell 9.6% year-on-year. In addition, Vietnam's Ministry of Agriculture forecast that, affected by drought, coffee production in the 2023/24 crop year may decline by 10%, which would be the lowest level in nearly four years.

Colombia

The National Federation of Coffee Growers of Colombia said that coffee production in 2023 reached 11.3 million bags, an increase of 2% from 11.08 million bags in 2022, but still slightly below the federation's earlier forecast of 11.6 million to 12 million bags. On the export side, shipments fell 7% to 10.5 million bags, down from 11.4 million bags exported in 2022. Colombia is the world's largest producer of washed Arabica. Earlier, affected by La Niña, heavier rainfall during the rainy season disrupted flowering times and yields. As the weather impact weakened, Colombia's coffee production in December rebounded to 1.22 million bags, up 24% from 981,000 bags in December 2022. December exports increased 3% to 1.06 million bags, higher than 1.03 million bags in December 2022.

Brazil

According to a report by Somar Meteorologia, rainfall in Brazil's Minas Gerais region over the past week was 35.1 millimeters, equivalent to 65% of the historical average, providing a slight boost to coffee production. Combined with higher Arabica production and increased planted area in Brazil, Brazil's 2023/24 Arabica production is expected to increase 12.8% year-on-year to 44.9 million bags. However, current weather forecasts show that temperatures in Brazil's Robusta-producing regions are 9°C above average, and rainfall is 75 millimeters below average. Whether Robusta production can recover still depends on observing subsequent climate changes.

Note: Each bag is 60 kilograms.

The above content is compiled by CoffeeHunters, a coffee news website.