Ico: Record Exports for Coffee

According to Ico, the estimate of total production for crop (year 2016/17) has been revised upwards to 157.44 million bags, a 3.4% increase on 2015/16.

Arabica production is up by 14.7% to 101.55 million bags, with increases observed for all three Arabica groups:

Production of Colombian Milds rose by 2.7% to 15.82 million bags
Other Milds by 15.6% to 30.29 million bags
Brazilian Naturals by 18.1% to 55.44 million bags.

However, Robusta production is estimated down 12.2% to 55.89 million bags.

Coffee production increased in Africa, Mexico & Central America and South America by 5.3%, 16.3% and 8.6%, respectively while production decreased by 9% in Asia for crop year 2016/17. The significant increase in production in Mexico & Central America is largely attributed to increased production in Honduras, the recovery from the coffee leaf rust outbreak in the region and beneficial weather.

In September 2017, total exports reached 8.34 million bags, compared to 9.79 million in September 2016.

Exports of Colombian Milds grew by 8% to 14.66 million bags
Other Milds grew by 15.6% to 27.02 million bags
Brazilian Naturals grew by 2.6% to 35.84 million bags.

While production of Robusta coffee declined greatly in crop (year 2016/17), shipments were relatively stable, amounting to 44.93 million bags.

Out of the ten largest exporters in coffee year 2016/17, only Brazil and Vietnam registered decreases compared to shipments in coffee year 2015/16.

Fig. 1 – Green Coffee Exports

Brazil’s exports declined by 8.8% to 31.58 million bags in coffee (year 2016/17), but its production increased by 9.2% to 55 million bags in crop (year 2016/17). Figures for exports of green and soluble coffee from Brazil (compared to coffee year 2015/16) suggest that exports of both forms of coffee fell by 8.8% in coffee year 2016/17 to 28.13 million bags and 3.43 million bags, respectively.
Exports from Vietnam have grown by 5.5% per annum in the last 15 years, though often with alternating years of growth and contraction. Total exports in coffee year 2016/17 are estimated to have decreased by 6.4% to 24.76 million bags following a year of record exports but this is still the third highest volume on record.
In crop year 2016/17, Colombia is currently estimated to have produced 14.5 million bags, up 3.5% on 2015/16, and is the fifth consecutive season of growth. Increases in exports have followed the same pattern as production, aside from 2015/16 when a strike at the ports hindered shipments.
Indonesia’s exports of coffee increased from 6.12 million bags in coffee year 2015/16 to 11.1 million bags in coffee year 2016/17. Preliminary figures suggest that green coffee exports, which represent around 72% of total exports, rose by 32.6% to 8 million bags.

Fig. 2 – Soluble Coffee Exports

After increasing for two consecutive years, world coffee consumption is estimated to have remained stable at 155.06 million bags. Coffee year 2016/17 is now seen in surplus after two consecutive years of deficit, with production exceeding consumption by 2.38 million bags.

Coffee prices have drifted downwards since the end of August 2017, though prices in October were fairly stable with a drop at the end of the month.

Fig. 3 – Ico composite indicator for daily prices