Global coffee production seen rising slightly to nearly 170 million bags in 2020/21; consumption seen rising faster

Total global production in coffee year 2020/21 is estimated to rise by 0.4% to 169.60 million bags, with Arabica production increasing by 2.3% to 99.24 million bags, the International Coffee Organization (ICO) said in its latest monthly report.

World coffee consumption, its said, is projected to increase by 1.9% to 167.58 million bags in 2020/21 compared to 164.43 million bags for coffee year 2019/20. With the easing of covid-19 pandemic related restrictions and the subsequent prospects of economic recovery, consumers are regaining confidence leading to a positive trend of world coffee consumption.

According to the ICO, the production of Robusta coffee is expected to decrease by 2.1% to 70.36 million bags. At the regional level, African output is expected to remain unchanged at 18.68 million bags in coffee year 2020/21 in comparison with the previous coffee year, while production for Asia & Oceania is forecast to fall by 1.1% from 49.45 million bags in 2019/20 to 48.93 million in 2020/21.

Production for Mexico & Central America is expected to decrease by 2.1% at 19.19 million bags against 19.60 million bags in coffee year 2019/20, the ICO forecast, adding that the decrease is likely to be significant as some countries in the region have been affected by hurricanes Eta and Iota earlier in this current coffee year as they are still struggling to recover from the damages caused to production and marketing infrastructure.

“An increase of 2% in production is expected from South America at 82.8 million bags, compared with 81.2 million bags in 2019/20. However, Brazilian production for the next crop year 2021/22, which has already started, is expected to decrease significantly as it is the off-year production cycle of Arabica coffee and was substantially affected by below-average rainfall,” ICO said.

Consumption in importing countries and domestic consumption in exporting countries is expected to grow by 2.3% and 1.0%, respectively, while consumption in Africa is expected to increase by 2.1% at 12.27 million bags and in Asia & Oceania it is forecast to increase by 1.3% at 36.70 million bags.

In the region of Mexico and Central America, consumption is expected to increase by 0.7% at 5.36 million bags. Consumption in Europe and North America will increase by 1.8% and 3.7%, respectively. Consumption of South America is expected to increase by 1.2%. As a result, the surplus of total production over world consumption is expected to be reduced at 2.02 million bags, compared with 4.50 million bags in the previous coffee year.

With the current development of the market  fundamentals and the expected yield reductions in many exporting countries as well as reduced investments in coffee farms due to limited access to credit a tight supply/demand balance is expected in coffee year 2021/22, the ICO said.

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