Global coffee prices continued their upward trend in April, as the monthly average of the ICO composite indicator rose to 122.03 US cents/lb, 1.4% higher than in March 2021 and 12% higher than in April 2020, representing the sixth consecutive month of increase and the highest monthly average in over three and a half years, the International Coffee Organization (ICO) said in its latest monthly report.
In April 2021, the daily composite indicator fluctuated between 114.22 and 130.87 US cents/lb, it added. Market
fundamentals are one of the main drivers of the current price trends as the imbalance between consumption and total production is getting smaller.
Arabica supplies are expected to tighten in the near future, with Brazil’s production projected to decline by more than 30% in its 2021/22 off-year crop. Moreover, various restrictions due to the ongoing pandemic affecting particularly the movement of population are expected to be gradually eased in the near future, the report said.
According to the ICO, total production in coffee year 2020/21 is estimated to rise by 0.5% to 169.63 million bags, with Arabica production increasing by 2.6% to 99.42 million bags. The production of Robusta coffee is expected to decrease by 2.4% to 70.21 million bags.
At the regional level, a slight decrease of 0.8% is expected for Africa at 18.54 million bags in coffee year 2020/21 in comparison with 18.68 million bags in the previous coffee year. Production for Asia & Oceania is forecast to fall by 1.1% from 49.48 million bags in 2019/20 to 48.95 million in 2020/21.
Production for Mexico & Central America is expected to decrease slightly by 0.1% at 19.54 million bags against
19.56 million bags in coffee year 2019/20. An increase of 1.8% in production is expected from South America at 82.59 million bags, compared with 81.12 million bags in 2019/20.
World coffee consumption is projected to increase by 1.3% to 166.34 million bags in 2020/21 compared to 164.20 million bags for coffee year 2019/20. The negative impact on coffee consumption experienced during coffee year 2019/20 with the outbreak of the covid-19 pandemic is fading as consumption is regaining its normal trend, the ICO report said.
It forecast consumption in importing countries and domestic consumption in exporting countries to grow by 1.3% and 1.4% respectively. Consumption in Africa is expected to increase by 1.8% at 12.24 million bags.
Consumption in Asia & Oceania will increase by 1.4% at 36.50 million bags. In the region of Mexico and Central America, consumption is expected to increase by 0.7% at 5.36 million bags. As a result, the surplus of total production over world consumption is expected to be reduced at 3.28 million bags, compared with 4.6 million bags in the previous coffee year, the report aded.