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2017/2018 CONCERNS KEEP ARABICA PRICE AT AROUND 150 CENTS

2017/2018 CONCERNS KEEP ARABICA PRICE AT AROUND 150 CENTS



More than 90 per cent of the 2016/17 Brazilian coffee crop has now been harvested, with analysts at Safras & Mercado predicting a harvest of around 50 million bags. Arabica production has been surprisingly positive, which may be able to absorb ongoing losses in the Robusta crop. In addition to reports from Vietnam and Indonesia, the poor Robusta crop in Brazil has played a major part in the sharp rise in the Robusta coffee price this year. Robusta prices in Brazil have climbed to a record level. “This is because the outlook for the 2017/18 crop appears critical after conditions were too dry for a long period, hampering pollination,” said analysts at Commerzbank Research.

The higher Arabica crop has been dampening prices in the country again of late. In mid-August they fell to around the 136 cent level, significantly lower than they had been on the exchange in New York in mid-July, when they briefly rose to above 150 US cents per pound.

However, as Commerzbank reported, the price level is being maintained because the Arabica outlook for 2017/18 is also overshadowed by concerns about weather conditions. “A number of instances of sudden frost in recent months and cold weather could have reduced potential yields, though they can no longer do anything to harm the current crop,” Commerzbank said.

At the time of writing on 5 September 2016, the C price was at around 150 cents per pound.

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