Global coffee exports drop 3.7 percent in March

By George Mangula

Global coffee exports fell by 3.7 percent to 11.06 million bags in March 2020 and shipments in the first six months of coffee year 2019/20 decreased by 3.9 percent to 61.96 million bags, according to International Coffee Organisation (ICO) report for April 2020.

ICO says it has revised global coffee consumption to 166.06 million bags in coffee year 2019/2020, which represents an increase of 0.5 percent compared to 165.27 million bags in 2018/19. “As a result, production is expected to exceed consumption by 1.95 million bags.”

The organisation in its report further says many countries have suspended non-essential activities and instituted social distancing measures, which have negatively impacted out-of-home coffee consumption. Additionally, job losses could lower demand, particularly for non-habitual consumers.

“Output from 2019/20 is unchanged as much of the harvesting occurred before the global pandemic. Instead, the impact on production is more likely to be seen in the 2020/21 coffee year, for which harvesting has already begun for countries like Brazil where the crop year begins in April,” it says.

According to the report, in October 2019 through March 2020, shipments of Arabica fell by 7.8 percent to 38.6 million bags while Robusta shipments increased by 3.2 percent to 23.36 million bags. 

Robusta prices also fell in April 2020, averaging 63.97 US cents/lb, 5.2 percent lower than in the previous month. This also represents the lowest monthly average for Robusta prices since June 2006 when it reached 60.23 US cents/lb. 

ICO report shows coffee imports by major importing countries totalled 40.56 million bags in the first four months of coffee year 2019/20, which is 9.4 percent lower than in October 2018 to January 2019.

Imports of all forms of coffee by major importing countries fell during this period. Green coffee imports fell by 3.7 percent to 31.73 million bags. Processed coffee imports, which accounted for 21.8 percent of the total also decreased. Roasted coffee fell by 22.5 percent to 5.39 million bags and soluble coffee by 28.8 percent to 3.44 million bags. 

Meanwhile, in January 2020, imports for the major importing countries decreased by 25.2 percent to 8.71 million bags compared to their imports in January 2019. This follows larger than expected imports by the European Union and the United States in coffee year 2018/19.

“Additionally, the sudden rise in prices from late November through December 2019 is likely to have encouraged importers to delay further purchases. While consumption in 2018/19 rose by 4.9 percent for Europe and 5.7 percent for North America, imports in the first four months of coffee year 2019/20 indicate that demand growth is not likely to continue at this rate, but instead would have been closer to the long-term average. However, the import data covers the period just prior to the spread of covid-19, and the impact of the pandemic now presents considerable downside risk to consumption growth in 2019/20.”