A reduction has been projected of between 10% and 15% in the 2017/18 harvest due to the effects of drought and frost in different production areas in the country.
The projections are the result of an assessment carried out by the technical department of the National Coffee Association (Anacafe) in different parts of the country.For the 2017/18 harvest a production of 3.35 million hundredweight is expected.
The prices of all varieties rose in January, especially Robusta, which increased by 6% compared to December, reaching the highest monthly level since September 2011.
From a report by the International Coffee Organization:
In January, the coffee market recovered from the fall in prices which was recorded towards the end of last year. While a price increase could be observed across all groups, it was most notable for Robusta.
Genetic diversity and climate change are two of the topics covered in the international event on Coffee Science in San Salvador, from May 31 to June 2.
The World Coffee Science Summit is scheduled to start on the evening of Wednesday May 31 and end with a dinner party the night of Friday June 2nd 2017. It will feature world-class conferences and EXPOCAFE, an exhibition hall showcasing companies, products, services and research institutions.
The upward trend that had been seen in prices suffered a significant reversal in November, due to better weather prospects in Brazil and Vietnam and a depreciation in the Brazilian real.
The recent rally in coffee prices underwent a notable reversal in November 2016, attributed to improved weather prospects in Brazil and Vietnam and a concurrent depreciation in the Brazilian real.
Insufficiency of the Robusta variety has caused the coffee market to reach its highest level in 21 months.
From a report by the International Coffee Organization:
Coffee prices rose significantly in October, with support coming from continuing concerns over Robusta supply. The monthly average of the ICO composite indicator hit a 21-month high of 142.68 US cents/lb, with the Robusta indicator at its highest level in two years.
The largest producer of washed Arabica coffee increased its harvest in the last twelve months by 3%, reaching 14 million bags each weighing 60 kilos.
From a statement by the National Federation of Coffee Growers in Colombia:
The General Manager of the FNC celebrated production levels and coffee prices and invited coffee growers to take advantage of them to plan for the future.He also recalled that current price levels are offsetting losses in the first half of the year. In the last twelve months Colombia coffee exports amounted to 12.39 million bags.
The downward trend seen in international grain prices "raises doubts about the economic viability of coffee production."
From the Introduction of a document entitled "Assessment of the economic sustainability of coffee production", prepared by the International Coffee Organization:
Introduction Since March 2015 the ICO composite price has been consistently below the 10-year average of 137.24 US cents/lb, raising concerns about the economic viability of coffee production and putting the livelihoods of coffee producers at risk in many countries. Prolonged periods of low prices strain liquidity at the farm level, resulting in less than optimal input use during the following production cycle, negatively affecting yields and quality.
Coffee year 2015/16 ended with a global production of 148 million bags and a total consumption of 151 million bags.
From a report by the International Coffee Organization (ICO):
The coffee market settled up by 5.5% in September, mostly driven by a steady increase in Robusta prices supported by concerns over future supply. This brings coffee year 2015/16 to an end, and we have revised our production estimate up to 148 million bags.
Because of incidences of rust, coffee production in the 2015-2016 harvest was only 3.9 million hundredweight, equivalent to $700 million in foreign exchange.
The presence of rust in more than half of coffee plantations, lack of funding to renovate plantations and low international grain prices resulted in a reduction in production and in export values, for the second consecutive cycle.
With trust funds planned for this year still not liberated, the union is negotiating with entities such as the CABEI and the IDB to obtain new sources of funding.
The National Coffee Association (Anacafe) estimated at $955 million the amount needed to renew 60% of coffee plantations, and although "it may seem very high," Alexander Keller, vice president of Anacafé, says that"...
An increase has been foreseen in diseases affecting coffee crops in September and October, due to the transition of from severe drought to above normal rainfall.
From a statement issued by the Inter-American Institute for Cooperation on Agriculture:
San Jose, September 12, 2016 (IICA).The transition from severe drought to rainfall above normal that occurred between 2014 and 2015 put Central American countries on alert, as they could face a surge in diseases affecting coffee crops, such as rust and 'ojo de gallo' in some areas of the region.
Export volumes in July were 22% lower compared to last year, as the four major producers recorded fewer exports.
From the International Coffee Organization:
Export volumes in July were 22% lower compared to last year, as all four of the top producers registered lower shipments, due to a variety of factors. This represents the lowest monthly volume since October 2011, nearly five years ago.
The end of hostilities between the government and guerrillas will enable the cultivation of grain in regions which have been hitherto untapped, which could increase the 2020 harvest to 20 million bags.
The Minister of Finance in Colombia, Mauricio Cardenas said in an article on Swissinfo.ch that"... the domestic industry" isalreadyon the rise , "mainly due to an increase in productivity per hectare in recent years, and he said that in 2016 it is expected to be located at between 14.5 million and 15 million bags, up from the 14.2 million recorded last year. "
The Producers Guild estimates that in 2016 the harvest will close with 14.5 million bags of 60 kilos, 1.5 million bags more than originally projected.
Weather conditions which are better than those foreseen at the beginning of the season explain the improvement in the forecast for production at the end of the harvest, which was initially estimated at 13 million bags, if the effects of El Niño occurred as predicted.