Brazil’s coffee stockpiles, meant to last until July, are dwindling as farmers cash in on record high prices.
Having struggled to stay afloat during one of the worst droughts on record in 2024, Brazil’s coffee farmers have sold nearly all of their beans months ahead of schedule, reports Reuters. The growers are eager to cash in global prices for the bean, which nearly doubled to all-time highs in the past 14 months. Last year saw prices for arabica, the most popular ground coffee variety, soar 70 percent while robusta, more commonly used in instant coffee, surged 72 percent.
Another 20-percent jump this year had arabica selling at an all-time high of over US$4.30 per pound on 11 February, while robusta peaked at US$5,847 per metric ton on 12 February. Consultancy Safras & Mercado reported last Monday that farmers have sold 88 percent of the 2024 crop, exceeding figures for this time last year (79 percent) and the five-year average (82 percent).
“We never had such low stocks in February, a period that is still distant from the new crop,” Willian Cesar Freiria, sales manager at Cocapec, Brazil’s third largest coffee co-op, told Reuters. “Until the start of the next harvest we won’t have much coffee to sell,” Freiria explained. “And it is not only us; it is the same everywhere.”
[See more: Paying more for your coffee? Blame climate change for that]
Luiz Fernando dos Reis, sales superintendent for Cooxupe, the world’s largest coffee co-op, echoed him. Cooxupe farmers have already sold 90 percent of the 2024 crop, he told Reuters. “What they have left is the lowest amount we ever saw in our records.” With the next harvest not set to start until around May or June, and will not be ready for shipping before July, that leaves a sizable gap.
Most farmers, particularly small-scale farmers, have sold more but a few are holding onto some of their harvest as a precaution. Paulo Armelin, who farms near Patrocinio in the Cerrado Mineiro region, is holding onto 40 percent of his harvest as insurance. “I will have a smaller production this year, so I decided to hold on to some coffee from last year as a reserve in case of need,” he explained to the news agency. He’s currently negotiating with a San Francisco-based roaster, asking for US$4.50 a pound, a nearly 48-percent increase over last year’s price of US$3.05.
“It is very good coffee and I’m actually cutting the premium I used to have over the futures,” he said, referring to contracts to sell at a predetermined price on a future date. Sales of coffee futures have fallen well behind average this year, sitting at just 13 percent compared to a four-year average of 22 percent.
Brazilian government crop forecasting agency Conab projected a 4.4-percent drop in production for the 2025 to 2026 coffee crop, hitting a three-year low of 51.81 million bags, due to persistently low rainfall creating the driest weather the country has seen in decades.
