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Coffee analysts and traders are always keeping a close eye on harvests in Brazil. As the world’s largest coffee producer, the country wields outsized influence in the global commodity market. Unseasonal frost or heat can negatively impact production and send the C price soaring, while news of more favorable weather often has the opposite effect.
This year is predicted to be a record harvest. The latest survey from CONAB, Brazil’s equivalent to the USDA, forecasts that Brazil is set to harvest 66.7 million 60-kg bags of coffee. This would be an 18% increase over the previous year, and the largest harvest that CONAB has ever recorded. Other sources, such as Rabobank, predict an even higher yield of 73.3 million bags.
Part of the reason we’re seeing record numbers is due to circumstance. Brazil has a biennial production cycle, meaning coffee trees produce higher yields in alternating years (Brazil’s positive biennial harvest happens in even years). However, that’s not the only reason for the uptick—CONAB highlighted that weather conditions were favorable for coffee and noted that farmers were expanding to new production areas across the country.
In interviews with Valor International’s Cibelle Bouças, producers and other stakeholders expressed optimism about this year’s harvest. “The crop is in very good condition. The weather was favorable, with regular rainfall,” said Fabiano Tristão from the Capixaba Institute for Research, Technical Assistance, and Rural Extension.
Because Brazil is so large and the harvest spans months, forecasting the exact total is difficult. Others speaking with Bouças, therefore, were more cautious in their predictions. “The harvest will be good. It will not be bigger than in 2020, but it will be good,” said Juliana Paulino, president of the Coffee Growers Association in Southwestern Minas Gerais.
We’ll have to wait and see how this harvest affects coffee’s commodity price. The coffee C price hit record highs last year, spurred by supply concerns due to climate extremes and various geopolitical factors, such as tariffs, that drove prices higher. However, analysts have long speculated that the harvest in Brazil would be high, and futures market prices have been falling for months as a result.
Read the full story on Brazil’s record-breaking harvest from Global Coffee Report here.
Photo by PROJETO CAFÉ GATO-MOURISCO on Unsplash
