NEW YORK EXCHANGE and DOLLAR
March/21: Min: 122.40 | Max: 129.30 | Last: 127.10 USC/lb
BRL/USD: Min: 5.3217 | Max: 5.4856 | Last: 5.3610 *Data until the completion of this report.
In a week of high volatility, the March/21 contract prices reached near 130 and also 120 usc/lb, registering only in the first day highs above 400 points.
The market followed concerns about the climate in producing countries, technical movements, the global and Brazilian macroeconomic scenario, the dollar drops, shipments from Brazil and a rise to 1,638 million bags in certified Arabica stocks at ICE.
The is a lack of containers with most shipowners. We have observed a significant increase in the omission of vessels and postponement of bookings. Shipowners have reduced the free time period at the origin. Normal flow of trucks in coffee operations during the week.
DOMESTIC MARKET and FOB EXPORT
Arabica prices followed firm and high, however, as we have commented, producers are capitalized and cautious to sell their remaining stocks from the 20/21 crop, because they believe in new market highs, braking prices in the domestic market.
Despite the calm, some occasional deals were made to meet short-term demands of the foreign market. On Monday, the International Coffee Organization (ICO) announced that Brazil’s global coffee exports increased by 6.1% to 31.59 million bags between October and December.
The plants present good vegetative vigor, filling of the grains, and growth of the branches within normality, which is very important for the next two harvests. Even so, it will feel the climatic conditions of the previous months and La Nina in the 21/22 crop.
Many coffee growers plan to carry out new fertilization in February and report high prices for the input. We are about 2 months from the beginning of the 21/22 harvest in lower and warmer coffee regions of Brazil.
According to Somar Meteorology, the accumulated rainfall in January between São Paulo, Sul de Minas, and Cerrado Mineiro was 100 to 150 mm, values below the historical averages for the month by about 40%. In the last week of January, Minas Gerais, the largest Arabica producer in Brazil, received 1.5 mm of rainfall, only 3% of the historical average, which supported coffee prices.
The first 4 days of February were hot and few rains. For the next 7 days, a cold front changes the weather in the Arabica regions, with milder temperatures and heavy rains expected, as below:
200mm – central region of Minas Gerais
175mm – Zona da Mata and south of Espírito Santo
50mm to 100mm – South of Minas and Mogiana
50mm – Cerrado
COVID-19 IN BRAZIL
Brazil has registered in the last 15 days the average of 1 thousand lives lost daily.
Vaccinated since Jan 17: + 3 mi
Percentage of population vaccinated: 1.44%
Cases: + 9.4 mi
Deaths: + 229 K
Recovered: + 8,37 mi
Let’s keep believing and investing in the coffee culture!
Atlantica Coffee Team