Global coffee surplus of 3 million bags expected for 2024/25
Brazil’s 2024/25 coffee crop seen at 69.5 million bags
Vietnam 2024/25 coffee crop seen at 29.5 million bags
By Marcelo Teixeira
NEW YORK, Feb 29 (Reuters) – Prices for futures of arabica and robusta coffees at the ICE exchange are expected to end 2024 below current levels, as well as lower than where they ended last year, a Reuters poll of 10 traders and analysts showed on Thursday.
Arabica coffee prices were expected to end 2024 at 165 cents per pound, according to the median forecast of the poll, which would mean a 9% drop from both Wednesday’s close and from end-2023.
Robusta coffee prices were expected to finish the year at $2,600 per metric ton, 14% less than Wednesday’s close and also 14% below prices at the end of last year.
In January, robusta futures hit the highest prices since the current form of the contract started trading in 2008, but have retreated from that peak.
Poll participants believe coffee prices will be pressured in coming months by a more favorable supply outlook, with a median forecast for the global 2024/25 supply balance at 3 million bags, compared to only 0.6 million bags in 2023/24.
They expect coffee production at top grower Brazil to increase to 69.5 million bags in 2024/25 from 66.1 million bags in 2023/24 and see production in Vietnam, the world’s second largest overall producer and the leading robusta grower, jumping 1.5 million bags to 29.5 million bags in 2024/25.
Three analysts polled by Reuters said a main factor in the market would be the change in climate patterns, from El Nino currently to La Nina likely in the second half of the year.
The El Nino is generally considered more negative for coffee production since it tends to result in drier weather for robusta fields in Asia, and warmer than average climate in Brazil. The move to La Nina could lead to more favorable weather for coffee crops.
