Despite the harvesting, trading pace is slow in the Brazilian market

Cepea, August 5 2019 – With the firmer and drier weather in the second fortnight of July, the harvesting of the 2019/20 crop stepped up in all the arabica producing regions surveyed by Cepea. However, the trading pace is slow in Brazil, due to the sharp price oscillation in both the domestic and the international markets during the month. In general, quotes were influenced by the weather in Brazil, the exchange rate and technical factors.


Price gaps were mainly observed in the market of arabica. In July, the maximum and minimum levels for the CEPEA/ESALQ Index for arabica coffee type 6 (delivered in São Paulo) were 452.92 BRL per 60-kilo bag (on July 3) and 402.56 BRL per bag (on July 31).


In general, the coffee volume marketed in the 2019/20 season refers to the deliveries scheduled in previous months as well as some occasional deals, due to growers’ needs of cash flow. Agents have reported that from 10 to 30% of the arabica output had been traded until July 19. As for the harvesting, activities were ending in most arabica-producing regions.


ROBUSTA – Liquidity was low in the robusta market too. In July, quotes dropped, reflecting international price drops and the Real appreciation against the US dollar, which drove growers away from the market. Besides, agents claim that most deals for the robusta coffee from 19/20 were closed early in the season, between May and June, since growers needed cash flow for the harvesting.


According to agents, in Espírito Santo, the biggest robusta-producing state in Brazil, coffee sales had reached from 20 to 30% of the total crop until July/19. In Rondônia, however, a smaller coffee volume has been traded, since most part had been previously marketed. According to Cepea collaborators, from 40 to 50% of the crop has been sold.


Concerning the harvesting, fieldwork ended in Rondônia in early July. In Espírito Santo, activities ended in the second fortnight of July.


PRICES – On July 31, the CEPEA/ESALQ Index for arabica coffee type 6 (delivered in São Paulo) closed at 402.56 per 60-kilo bag (105.99 USD), 7.3% down compared to that on June 28.


As for robusta, the CEPEA/ESALQ Index for the robusta type 6, screen 13, Espírito Santo State, closed at 274.71 BRL/bag (72.33 USD), for a decrease of 6.6% in the same comparison.




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