Trades involving arabica coffee were slow in the Brazilian market in April, only a few weeks away from the beginning of the harvesting, reports CEPEA. The CEPEA/ESALQ Index of arabica type 6, hard cup or better (delivered in São Paulo city) was around 460.00 BRL (129.57 USD) per 60-kilo bag in April, after having fluctuated above 500.00 BRL (140.84 USD) per bag in March.
The average difference between prices of arabica and robusta coffees, both type 6, was 87.37 BRL (24.61 USD) per bag in April, the lowest since January 2014. This narrowing is due to drops in arabica quotes and rises in robusta values in April.
In April, the CEPEA/ESALQ Index of arabica type 6 hard cup or better (delivered in São Paulo city) averaged 466.70 BRL (131.46 USD) per 60-kilo bag, almost 5% lower than the average of March. On the other hand, the CEPEA/ESALQ Index of robusta type 6, screen 13, rose 4% in the same comparison, averaging 379.33 BRL (106.85 USD) per 60-kilo bag in April.
Besides the harvesting proximity of the 2016/17 arabica season, expected to have a higher output, prices of the variety have been falling, influenced by drops at the New York Board of Trade (ICE Futures).
Regarding robusta, expectations of lower production in the new season and higher percentage of low quality grains, especially in Espírito Santo, underpinned quotes. In general, agents expect drops in robusta quotes only when supply of the new crop increases.
Meanwhile, harvesting of this variety is still beginning and the first grains supplied show lower quality, classified as types 7/8 and 8.
In this scenario, the price gap between the varieties is expected to narrow in the next weeks.
According to Cepea data, the lowest gap, 32.92 BRL (14.06 USD) per bag, was observed in August 2013. In that season (2013/2014), arabica prices registered low levels due to the higher supply and large inventories.
