On August 1, 2023, September arabica coffee prices rose by 5.24% to $342.17, while September robusta coffee prices increased by 2.76% to $3,917. This surge follows concerns over Brazil’s coffee harvest, exacerbated by heavy rainfall in the country’s major coffee-growing region, Minas Gerais. According to Somar Meteorologia, 32.4 mm of rain fell in the week ending July 26, 2700% above the historical average.
The slow progress of Brazil’s coffee harvest, reported at 47.3% completion as of July 17 compared to 59% the previous year, has contributed to heightened prices. Safras & Mercado indicated that Brazil’s harvest was only 64% complete as of July 15, trailing both last year’s 77% and the five-year average of 70%. Meanwhile, robusta inventories dipped to 4,139 lots, though they had reached a 4.25-month high of 4,254 lots prior.
Concerns about the potential impact of an El Niño weather pattern on Brazil’s coffee crop next year further support rising coffee prices. The U.S. Climate Prediction Center warned that this El Niño could be one of the strongest in over 75 years, raising the risk of adverse weather affecting production in key regions.
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