After rising sharply in February, prices weaken in Brazil in the first fortnight of March

Cepea, March 17, 2021 – After increasing sharply in February, arabica coffee prices weakened in the Brazilian market in the first fortnight of March. Between February 26 and March 15, the CEPEA/ESALQ Index for arabica coffee (delivered to São Paulo city) dropped 9.32 Reais per bag (1.2%), closing at 737.18 BRL (130.59 USD) per 60-kilo bag on March 15.


Domestic devaluations were linked to the price drops in the international market in that period, which were influenced by both the dollar appreciation against Real and technical corrections. On March 15, the American currency closed at 5.645 BRL, 1.14% up in the fortnight.


In this scenario, Brazilian sellers left the market, limiting deals. However, it is important to mention that liquidity was high in late February. According to Cepea collaborators, until the end of February, from 75 to 85% of the 2020/21 crop of arabica coffee had been sold.


In light of the low amount of coffee remaining and the uncertainties about prices in the coming months (due to the crop failure in the 2021/22 season), agents believe that liquidity may continue low in Brazil until the beginning of the harvesting.


ROBUSTA – As in the market of arabica coffee, robusta prices dropped in the Brazilian market in the first fortnight of March, pressed down by international devaluations; thus, the domestic market became calmer again. Between February 26 and March 15, the CEPEA/ESALQ Index for the type 6, screen 13, Espírito Santo State, decreased 5.88 Reais per bag (1.3%), closing at 449.34 BRL (79.60 USD)/bag on March 15.


It is worth to mention that the volume of robusta coffee sold in February was not as high as that for arabica, since robusta prices did not rise as much. Data from Cepea indicate that from 78 to 88% of the 2020/21 crop of robusta coffee had been traded until late February, against 77 – 85% in January.


Robusta farmers continue away from the market – these agents should resume selling higher amounts of the variety when the harvesting of the 2021/22 crop begins. In Rondônia, agents have reported that some beans have been hand-picked in early crops. Activities should step up in Rondônia between late March and early April. In Espírito Santo, the harvesting should begin between April and May.




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