KCNY and Currency
The macroeconomic news about inflation in the United States and Europe brings more doubts to the markets. In the coffee sector, we have doubts about consumption, crop size revisions, and concerns about the farming. Commodities are down this Friday and coffee follows this trend against the devaluing Brazilian Real.
- According to Cecafe (Council of Coffee Exporters of Brazil), Brazil set a historical record in revenue from January to August 2022 in coffee exports. An increase of 61.4% when compared to the same period in 2021. However, there was a 5.3% decrease in volume in comparison to the same period.
- According to the Allegra World Coffee Portal report, the coffee shop segment in the United States has grown 10% in sales over the past 12 months, however issues such as the rising cost of living, supply chain obstacles, and labor retention difficulties will bring major challenges in the next 12 to 24 months;
- On Thursday, the Green Coffee Association (GCA) released its US port stocks numbers, with an above average increase of 226,801 60-kg bags. The final figure is 6,450,086 60-kg bags;
- The consultancy Safras & Mercados revised its crop number to 58.2 million 60kg bags from the 61.1 million initially estimated, on last Thursday. There was a reduction in the Arabica crop of 3.6 million 60kg bags with an increase in the Conilon crop of 700,000 60kg bags;
- The NY “ICE” certified stock closed Thursday at 563,766 60-kg bags;
DECEMBER/22: Min: 211,35 | Max: 230,05 | Last: 217,70
BRL/USD: Min: 5,0790 | Max: 5,2950 | Last: 5,2660
*Data as of the completion of this report
WEATHER
Over the week, there were rains in the South Minas and São Paulo regions, but these were not shown in last week’s weather models. The rains were not abundant, but they were constant, reducing the high temperatures and the dry weather that brought concerns about their impact on the coffee crops.
For next week it is expected some rain of low intensity in the South Minas and Zona da Mata regions, due to a cold front coming from São Paulo that passes through Minas Gerais state. The frontal system loses intensity as it advances along the coast of the Southeast region of Brazil.
The weather forecast models show that a cold front is expected to act between the states of São Paulo and Minas Gerais on September Therefore, the second half of September will be rainy in the coffee regions of Garça, Mogiana and South Minas.
Rainfall forecast for the week:
South Minas region: between 10 and 15 mm.
Alta Mogiana and Garça region: between 15 and 25 mm.
Zona da Mata and Cerrado region: no rain is forecasted.
DOMESTIC MARKET and FOB
The week was virtually without business on the domestic and FOB markets.
Strictly soft good cup running screen: seller close to R$ 1.230,00
Strictly soft fine cup running screen: seller close to R$ 1.270,00
Rio Minas:
17/18: R$ 1.140,00
Running screen with 30% low grades: close to R$ 1.040,00
600 defects: close to R$ 1.180,00;
LOGISTICS
Once again, the week was marked by shortage of space, in general. The routes to North America, mainly to the United States, show a more critical situation. Some shipowners have already announced allocations only for November.
The lack of food grade containers also persists. Some schedules had to be cancelled for this reason.
We reinforce the need to send shipping instructions in advance, with more than one option of shipowner.
COVID-19 IN BRAZIL
People who received the first dose: +181.011.268
Fully vaccinated people: +170.416.917
Cases: + 34.610.590 million
Deaths: 685.258 thousand
Let’s continue believing and investing in the coffee culture!
Atlantica Coffee Team
FRAUD ALERT
Fraudsters have created accounts at the domains atlanticacoffeee.com (with 3 letters “e”), atlanticacoffees (plural) and atlantlcacoffee (using the lowercase of L instead of the letter i) and for the prefixes using the names of our employees, even imitating our signatures. They are quoting coffee, issuing invoices with altered payment data, mostly to banks in Hong Kong, which we are not ours! Please be aware of the sender of the messages and always question instructions to change bank details!
Our only official e-mail domain is: atlanticacoffee.com