What do record arabica beans exports from Brazil mean?

Brazil exported 3.961 million bags of 60 kg coffee in January 2024, a record for the first month of any year and a 39% rise year on year, according to the Brazil Exporters Council Cecafe. Foreign exchange earnings climbed 30.4% to $802.5 million. Arabica beans accounted for 3.208 million bags, or 80.98% of the total.

Robusta coffee beans followed at 457,000 bags, up 50.35% and 11.56% of shipments. Domestic spot prices moved in opposite directions: arabica rose slightly by 0.86% over the month, while robusta jumped 12.6% on weather swings and uncertainty about the new harvest. The vessel delay rate at the Port of Santos reached 85%, and the Red Sea crisis and Panama Canal drought added pressure.

The latest report from the Brazil Exporters Council (Cecafe) shows that in January 2024, Brazil's coffee exports reached 3.961 million bags (60 kg/bag), setting a new record for the same period in history, with a year-on-year increase of 39%, and foreign exchange earnings rising simultaneously by 30.4% to $802.5 million. Arabica beans remain the mainstay, while Robusta bean shipments surged by more than 50%. However, external pressures such as geopolitical conflicts, the Red Sea crisis, and the Panama Canal drought persist, domestic spot prices have diverged due to weather and uncertainties in the new harvest season, and the vessel delay rate at the Port of Santos has climbed to a historic peak of 85%, casting a shadow over subsequent exports.

Recently, the Brazil Exporters Council Cecafe released a statistical report. The report stated that in January 2024, Brazil exported 3.961 million bags of 60 kg coffee, a figure that set a historical record for the first month of any year, growing by 39% compared to the same period last year. Foreign exchange earnings also increased by 30.4%, jumping from $615.5 million to the current $802.5 million.

In January of this year, the most exported was still Arabica coffee beans, with 3.208 million bags, accounting for 80.98%. The second most was Robusta coffee beans, whose shipments surged by 50.35% to 457,000 bags, accounting for 11.56% of the total. Brazil's coffee exports performed well in January, so the president of Cecafe stated that performing well in the face of global geopolitical conflicts and under the influence of the Red Sea crisis and the Panama Canal drought is recent good news.

Moreover, the president also analyzed that because the war between North Africa and the Middle East still exists, as well as the lack of rainfall in Central America, and the increase in freight rates or ship shortages may further complicate Brazil's situation, exporters are already facing high costs due to continuous delays and changes in vessel sizes and short opening times.

At the same time, reports also pointed out that changes have occurred in Brazil's domestic coffee spot market prices, with Arabica coffee spot prices rising slightly by 0.86% over the month, but Robusta coffee spot prices surged by 12.6%. The main reason lies in frequent weather changes and uncertainty in the new harvest season's production. And Robusta coffee production is clearly expected to decrease, so Brazil's domestic spot prices have followed international prices in rising sharply; although prices are at a high level, producers are also unwilling to sell coffee beans.

In addition, the vessel delay problem at Brazil's largest port, the Port of Santos, is becoming increasingly serious. According to the report, the rate of change in stopovers and delays at the Port of Santos reached 85% in January 2024, the highest percentage on record to date, surpassing 81% last November. It was revealed that due to physical space limitations at the docks, it is difficult for the docks to receive goods, and these problems have led to regular delays of goods at port terminals and shipyards filled with containers. Among them, 13% of vessels were delayed by more than 4 days, 54% were delayed by 3-4 days, and only 19% were delayed by 2 days, greatly slowing down coffee exports.

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