World’s Top Coffee Crop Keeps Shrinking, Leading to Shortage
According to crop forecasting service Conab, Brazil likely harvested about 40% less arabica coffee than previous year, the lowest quantity since 2009. The loss is roughly two-thirds of U.S. consumption, and Americans are the world’s biggest coffee drinkers. The beans may face shortages as a result of the drastically reduced production.
“There are no lines of trucks waiting to load coffee at warehouses,” said Regis Ricco, a director at RR Consultoria Rural in Minas Gerais. “Farmers send a truck with coffee to the warehouses, and the truck returns a few hours later, when it would ordinarily take a day. It’s concerning.”
Because Brazil’s harvest is diminishing, costs for people who want a gourmet morning brew will continue to rise. Coffee is only one of many commodities seeing price increases, raising concerns about growing food expenses around the world.
Drought in several areas, compounded with frosts and freezes in July, harmed Brazil’s harvest. Furthermore, the country’s crop changes each year between a low and high-yielding cycle, with this year’s crop being smaller.
According to Conab, farmers in Brazil collected 30.7 million bags of arabica this year, compared to 48.8 million last year. 60 kilos is the weight of a bag.
On ICE Futures U.S. in New York, Arabica futures have gained 44 percent this year.
