Brazil’s robusta coffee exports plunged last month to their lowest in more than four years, in a further sign of the squeeze on supplies of the variety exacerbated by strong domestic demand.
Robusta exports from Brazil, the world’s second-largest shipper after Vietnam, dived to 89,244 bags in August, according to coffee merchants’ industry group Cecafe.
That represented a fall of 39% from July, and a 74% plunge year on year – reducing shipments to their lowest for any month since May 2018, just as shipments were starting to recover from a two-year slump in volumes caused by successive drought-reduced harvests.
Last month’s weak volume also runs counter to a seasonal trend, with Brazil, fresh from its coffee harvests, typically seeing strong volumes at this time of year.
‘Higher number of purchasers’
However, Brazilian exporters have faced, besides continued logistical hiccups, strong competition for robusta beans from domestic roasters, seeking an alternative to high-priced arabica beans.
As research institute Cepea noted last week, Brazilian demand for robusta last month “increased because arabica prices have been high, leading agents from the industry to raise the share of robusta in blends”.
With demand whetted too by Brazil’s winter, “and the consequent increase in the consumption of warm beverages, such as coffee”, Cepea reported a “higher number of purchasers from coffee roasters in the national spot market” for robusta beans.
The institute reported an increased number of robusta purchases sealed on the spot market too.
Five-year high price
Against this competition, the price of Brazilian robusta beans sold for export rose by R$9.94 per bag last month to R$159.51 per bag.
That was the highest since May 2017, when prices were buoyed by the robusta supply squeeze caused by the prolonged drought in key growing areas such as Espirito Santo – a factor which drove the variety to an unusual premium over arabica at the time.
Last month, Brazil’s robusta export price equated to at R$81.27-per-bag discount to arabica values, narrowing from the R$95.92-per-bag gap recorded for July.
Contrary to the dip in robusta shipments last month, Brazil’s arabica exports grew by 14.5% month on month, and by 10.6% year on year, to 2.35m bags.
The country’s overall green coffee exports reached 2.44m bags, a rise of 10.9% from July, but easing year on year to their worst August performance since 2017.
Günter Häusler, the Cecafe president, praised merchants for keeping Brazil’s coffee exports flowing in the face of continued logistical setbacks.
“Even after more than two years of living with all known logistical bottlenecks, exporters continue to perform exemplary work, allowing Brazil to honour its international commitments and maintain its market share,” he said.