Brazil is the world’s largest producer of coffee. Current global coffee stocks are quite low in producing countries, and though inventories in consuming countries are fine, all eyes are on this growing season, as it has the potential to be of record size. It could be big enough to replenish stocks, but as most coffee market articles now state: it all depends on the weather.
The report for 10 November 2017 can be found here: aWhere Commodity Report - Brazil Coffee.
From pollination through harvest, some 30-35 weeks (or more) can pass, and during this time, production is correlated to the quality of the environmental conditions. See an earlier blog that has a primer on producing that lovely coffee bean (http://blog.awhere.com/coffees-precarious-position-aug-2017 ).
As has become all too obvious, the weather has and is changing. More extreme events, more out-of-season anomalies, higher temperatures, etc. aWhere monitors the earth’s agricultural weather with both temporal (daily observed + 7 days of daily forecast updated every 6 hours) and spatial (5 arc-min or ~9km x 9km) acuteness. From this foundation, we process and prepare a wide range of agricultural insight that is agronomic and growth stage specific. The signal from this effort is all about yield and production and relevant not only for commodities like coffee, sugar, cocoa, corn, soybeans but also to food security for small-holder farmers.
The current situation in Brazil remains expecting good production, but the record production is already likely compromised, due to the odd and variable weather. Early rains in August led to premature flowering in the southern coffee area (northern Parana state). It is still not clear if the subsequent 45+ days of hot and dry conditions impacted the fruit set (see a short video that references this here https://youtu.be/eMUdwndUaiM), but it is likely some yield potential is already reduced.
aWhere has been watching Brazil’s rainfall carefully over the past few years, and the state of Espirito Santo, which produces lots of Robusta type beans, may have difficulties, as the reservoirs built to supply irrigation water remain pretty low. Some yield potential may already be compromised. The current situation looks good in some areas and kind of dry in others. There are rains in the forecast, but recent forecasts have not exactly been correct. Monitoring this crop – closely – is imperative.
We look forward to sharing future insights as we closely monitor this crop. Please reach out with comments on this post or at [email protected]