Cepea, January 16, 2025 – This year is likely to be challenging for the coffee sector again, especially regarding the supply to meet the global demand. Prices in both domestic and international markets, which are already at record levels, are expected to continue high due to the short-term forecast of no significant production increases, limited stocks and firm global demand.
In Brazil, the production has not hit the record for four seasons – 2020/21 was the last crop that was above 60 million bags – data from Conab. This sequence of below-expected output is related to unfavorable weather conditions.
The 2025/26 crop, which will be harvested in mid-2025, may still have impacts of the weather in 2024 (high temperatures and a long period without rainfall).
Moreover, the weather in 2024 was also unfavorable for the production in Vietnam, world’s second largest coffee producer. As a result, there are no aspects that indicate a consistent recovery in stocks or even a decrease in the consumption, at least in the short-term.
It is worth noting that robusta coffee values hit records, in real terms, in 2024, operating at the level of BRL 1,800 per 60-kg bag. As for arabica, prices were the highest since 1997, in real terms, operating above BRL 2,200/bag.
Brazilian coffee shipments registered an excellent performance in 2024, a scenario that may continue to be observed in 2025, especially for robusta. Besides the low global supply and the firm demand, the devalued Brazilian currency boosts the competitiveness of the national product, and exports become more attractive for sellers in Brazil. As a result, shipments are likely to surpass 40 million bags in 2024/25.
(Cepea-Brazil)
Centro de Estudos Avançados em Economia Aplicada – CEPEA-Esalq/USP
