SAO PAULO, Brazil – The Brazilian prices for robusta coffee began September on the rise, boosted by increases in the futures traded at ICE Futures Europe (London Stock Exchange), higher demand in Brazil and the relative absence of sellers in the market, says Cepea in its latest report. On Sept. 15, the CEPEA/ESALQ Index for the robusta type 6, screen 13, Espírito Santo, closed at 758.64 BRL (144.72 USD)/bag, 9.8% (67.63 Reais/bag) higher than that on Aug. 31 and a nominal record in the series of Cepea, which began in 2001.
In the Brazilian market, agents from coffee roasters increased the demand for robusta coffee, due to the current low supply of arabica coffee and the sharp valuation of the lower-quality arabica, largely used in coffee blends. In general, some deals for robusta coffee were closed in the first half of September, but agents reported low liquidity because of the absence of many farmers, who expected prices to rise higher.
The crops of robusta coffee (2022/23 season) bloomed in Espírito Santo (ES) and Rondônia (RO) States in the first fortnight of September. Until last month, only a few flowers were open, however, rains between late August and early September favored a higher flowering. Rainfall is expected to help crops to recover from the damages caused by the heat and low moisture in Brazil.
According to agents consulted by Cepea, this was the major flowering related to the 2022/23 season, since the event was observed in all robusta crops. However, some flowers may still open in the coming months. The recent flowering raised expectations for the 2022/23 season of robusta in Brazil. If the weather continues favorable to coffee crops and farmers conduct adequate crop management, the productive potential of the next robusta crop is expected to be satisfactory, majorly in Espírito Santo.
The harvesting of arabica crops from the 2021/22 season is supposed to end in the coming days in most Brazilian regions. Until Sept. 10, 5% of the total still needed to be harvested. Farmers have been monitoring the weather, since some flowers from the 2022/23 season are opening in some areas.
Cepea collaborators reported blooms in Garça (SP) after the rainfall in late August. In the coming days, flowering is expected in the region of Matas de Minas (Zona da Mata), where it rained in early September too. Still, rainfall has been irregular and below the ideal, concerning coffee farmers in Brazil.
Despite low rains, precipitation from early September pressed down arabica futures and prices in Brazil, driving agents away from the market. Besides, the holidays in the United States (Sept. 6th, Labor Day) and in Brazil (Sept. 7th, Independence Day of Brazil) and protests of some truckers helped to keep agents away from the market, limiting domestic liquidity.
On Sept. 15, the CEPEA/ESALQ Index for arabica coffee type 6 (delivered to São Paulo city) closed at 1,068.05 BRL (203.75 USD)/bag, 1.5% down in the fortnight.