Brazil Coffee Exports Surge, Global Coffee Exports Up 3.7% Year-on-Year in New Harvest Season

Global Coffee Exports in January 2021

The International Coffee Organization (ICO) reported on February 24 that global coffee exports in January 2021 amounted to 10.21 million bags (60kg per bag), a decrease of approximately 3.6% compared to 10.59 million bags in the same period last year. However, total exports for the first four months of the 2020/21 season (October to September) reached 41.88 million bags, representing a 3.7% increase compared to 40.38 million bags in the same period.

Brazil's Increased Market Share

The International Coffee Organization stated that total coffee exports for the first four months of the 2020/21 season reached 41.9 million bags, higher than the originally estimated 40.9 million bags. This increase was primarily due to a 21.9% surge in coffee shipments from Brazil, the largest coffee-producing country, reaching 16.06 million bags. As coffee exports from other regions declined, this allowed large-scale, mechanized Brazilian coffee to gain market share.

Regional Export Performance

According to statistics, coffee exports from Africa decreased by 13% to 3.81 million bags in the first four months of the 2020/21 season, with Uganda remaining Africa's largest exporter, showing a 28.06% increase to 420,000 bags. Asian coffee exports declined by 3.9% to 12.19 million bags, with Vietnamese coffee exports decreasing by 10.4% to 7.88 million bags, while Indonesian coffee exports grew by 24.2% to 2.47 million bags. Central America, hit by dual hurricanes ETA and LOTA, saw coffee exports decline by 17.5% to 1.31 million bags, with Honduran coffee exports decreasing by 40% to 74,000 bags, Nicaraguan coffee exports down 40% to 450,000 bags, while Ecuadorian coffee exports increased by 22.8% to 798,000 bags.

Inventory Accumulation vs. Consumption

In analyzing the coffee export data for the first four months of the 2020/21 season, the International Coffee Organization noted that due to the abundant coffee production in Brazil during the 2020/21 season, some traders took this opportunity to expand their warehouse inventories. Therefore, in this export data, more coffee entered warehouses in consuming countries, with a relatively small proportion going directly to consumption.

Global Coffee Supply and Demand Balance

The ICO's view on the global coffee supply and demand balance for the 2020/21 season remains unchanged from the previous report, still projecting a coffee surplus of 5.27 million bags for the season. However, market analysts predicted in a recent Reuters survey that the coffee surplus for the 2020/21 season could reach a substantial 8 million bags.

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