The global coffee market for the third year in a row recorded a deficit of raw materials offers. Moreover, the production of Robusta is the lowest since 2012. Leading positions among exporters hold both producers of coffee and tea (Brazil, Vietnam, India) and processors (Germany, Switzerland, Italy). It is important that countries-processors derive a significant margin of their competencies and market position.
For example, the Swiss coffee costs 7.5 times more than the most expensive of the Ethiopian coffee and more than 17 times More than cheap Vietnamese.
According to ICO estimated shortage of coffee in 2016/2017 agricultural year, which began in October, will be 3.5 million bags (bag weighs 60 kg or 132 pounds).
Production of coffee beans, presumably reaches 151.6 million bags, consumption - 155.1 million bags.
The prospects for future production of Robusta in Brazil in 2017 remained low, - analysts say.
Against the background of the high offer of Arabica and Robusta deficit, experts expect a significant reduction in the difference in the prices of these varieties.
Arabica production is expected to be a record - 93.5 million bags - due to high yields in Brazil, Colombia, and Honduras.
Robusta coffee price increased by 43% compared with the beginning of 2016 - to $ 2190 per ton.
Since the beginning of 2016, the spread has decreased by about 13%.
It should be noted that Vietnam is the largest Robusta coffee producer in the world, and according to analysts, the reserves amount to 440 000 metric tons.
The growth of stocks may help to keep the price drop amid expectations of El Niño, and as a consequence of the natural limits on the market. The target markets are in this case the most economically developed countries - the US, Japan, and EU. These countries are the largest consumers in the studied segment.
Some local farmers sell Robusta for the reason that prices for coffee in bulk have fallen to the 16-month low, in this case, the price is simply not attractive for sale.
