Coffee Prices Slip as ICO Reports an Increase in Global Coffee Exports

Coffee prices are experiencing modest losses, with the International Coffee Organization (ICO) reporting a 0.9% YoY increase in global coffee exports to 9.53 million bags. The dollar index’s 3-week high is also affecting coffee prices. The ICO projects that global coffee production will increase by 5.8% YoY to 178 million bags due to an exceptional off-biennial crop year. Higher coffee exports are bearish for prices, with Brazil’s Nov coffee exports rising by 8.5% YoY to 235,000 MT and Honduras’ Nov coffee exports jumping by 63% YoY to 110,413 bags.

Arabica coffee prices last Friday posted a 6-month high on a new rule from the Intercontinental Exchange (ICE) that bans the resubmission of old coffee inventories. This rule change is expected to add further pressure to ICE-monitored coffee inventories, providing support for coffee prices.

Shrinking ICE coffee inventories are bullish for coffee prices, as ICE-monitored arabica coffee inventories fell to a 24-year low of 224,066 bags last Thursday. Dry conditions in Brazil are also a bullish factor for prices, with the Minas Gerais region receiving 38.7 mm of rainfall in the past week.

Robusta coffee has support, with the Vietnam Coffee Cocoa Association projecting 2023/24 Vietnam coffee production to fall to 1.6 MMT to 1.7 MMT, and Vietnam’s coffee exports in 2023/24 may fall by 15% YoY to 1.411 MMT.

Read More @ barchart

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