A poor harvest of arabica coffee beans in Brazil caused by drought and frost is likely to increase the price of coffee, reports The Wall Street Journal. Brazil is one of the world’s largest coffee producers and largest exporter of coffee, and arabica beans are in much higher demand, worldwide, than any other bean type.
Farmers in Brazil believe their crop of higher-end arabica may be less than half than usual. The news of bad weather in Brazil has already pushed coffee futures up, but the recent news may further affect this price. Recent inclement weather in Colombia, also a major coffee producer, has also negatively impacted the coffee industry.
Coffee prices have shot up in the last year after nearly five years of relative stability, according to the U.S. consumer-price data. Tiago Cazarini, a Brazil-based coffee broker, told the newspaper that global arabica prices are likely to rise once estimates for this year’s harvest in Brazil is completed.
José Marcos Magalhães, a coffee farmer and president of a coffee cooperative in Brazil, noted that it expects to receive under one million bags of coffee, down from 2.2 million in 2020.
The demand for coffee is beginning to surpass the supply, which can further heighten prices. For the second year in a row, global coffee consumption will exceed production, according to data from the International Coffee Organization. Full Story (Subscription Required)
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