Coffee prices settled mixed on Monday, with Arabica coffee rallying after Brazil’s weekend rain forecast failed to materialize. Below-normal rain in Brazil could curb coffee yields and is supportive of prices. Uganda, the world’s fourth-largest robusta producer, reported increased supplies in October, while robusta coffee climbed to a 2-month high. Vietnam’s agriculture department projected a 10% drop in coffee production in the 2023/24 crop year due to drought. Brazil’s October green coffee exports jumped by 24% YoY to 4 million bags, while Rabobank projected an 18% YoY increase in Brazil’s coffee exports in the 12 months ending June 2024. The U.S. Climate Prediction Center declared an El Nino weather event, which is likely to be supportive of coffee prices. Global coffee exports are shrinking, with the International Coffee Organization (ICO) reporting a 5.7% YoY decrease in global coffee exports during Oct-Jul. The USDA Foreign Agricultural Service forecasts a 2.5% YoY increase in world coffee production in 2023/24, with a 6.9% increase in arabica production and a -2.4% decline in robusta production.
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