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Brazilian coffee monthly update: February 2025

13 February 2025 11:41 RaboResearch

Read about exports, prices, weather, stocks, and crops in our latest update about the Brazilian coffee industry.

Rabobank

    In January 2025, Brazil exported 4m bags (60kg) of coffee, marking a 1.6% decrease compared to the same period in 2024. While arabica coffee exports remained nearly stable compared to January 2024, robusta/conilon coffee exports fell by 29%. This decline can be partly attributed to the increased competitiveness of Vietnamese robusta in terms of price, as well as the higher supply due to the nearing end of the harvest season in Vietnam. Notably, soluble coffee exports grew by 25% YOY. Cecafé's report highlights that around 1.8m bags were not shipped in 2024 due to ongoing logistical bottlenecks. In the coming months, we expect exports to gradually slow down due to reduced stocks in Brazil. In February, the barter ratio continues its downward trend, with one bag (60kg) of coffee per metric ton of fertilizer (blend 20-05-20). This is the best barter ratio since 2012, the start of our analysis. It represents a 54% decrease compared to the same period last year, when 2.2 bags of coffee were needed. The sharp increase in coffee prices has favored the exchange ratio, despite recent rises in fertilizer prices, especially urea. Coffee prices continue to appreciate in Brazil, following the international market trend where prices in New York broke the USD 4.0/lb barrier. In January, arabica and conilon coffee prices in Brazil increased by 8% and 10%, respectively, compared to the previous month. In February, prices continue to rise, with arabica averaging BRL 2,647 per bag and conilon BRL 2,070 per bag. Among other factors, the expectation of lower arabica coffee production in 2025/26 in Brazil and the current low local stock levels are bringing significant volatility to the market. Recently, ABIC reported that coffee consumption in Brazil reached 21.9m bags in 2024 (Nov-Oct), a 1.1% increase compared to 2023. This figure is close to Rabobank's estimate of 21.6m bags (Jul-Jun). The growth comes amid rising consumer prices, which saw a 44% increase between January and December 2024 (ABIC). It is expected that supermarket coffee prices will rise by about 25% in the coming months, as arabica coffee prices have surged by 162% and conilon prices by 146% over the past 12 months. In January, rainfall has been satisfactory in the main coffee-producing regions. So far in February, rains have been occurring, except in the Zona da Mata and Espírito Santo regions. The rains should continue to favor grain development. However, they may not fully compensate for the damage from the poor flowering set that occurred in the arabica coffee-producing regions. At the end of this month, the RaboResearch team will start the crop tour to estimate the Brazilian 2025/26 harvest.

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