Weekly market report + 21/22 Crop Research – Montesanto Tavares Group – January 11-15, 2021 | Atlantica
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Weekly market report + 21/22 Crop Research – Montesanto Tavares Group – January 11-15, 2021

by Jan 15, 2021Fine Cup0 comments

CROP RESEARCH 2021/2022 – Montesanto Tavares Group
The Montesanto Tavares Group publishes the first research on the 2021/2022 coffee crop. Brazilian coffee production in the 2021/2022 season is expected to reach 52.9 million bags, a 23% decrease compared to the 2020/2021 crop, indicated at 68.21 million bags. The estimate is part of the field research in all producing regions developed by the Montesanto Tavares group and with closed data on January 10, 2021.

According to the study, the main reason for this decrease comes from the smaller crop of arabica coffee in the off-cycle season 2021/2022. Brazilian production of arabica coffee on 21/22 is expected to reach 31.23 million bags, 18.68 million bags less than in 2020/2021, due to the biennial cycle of the crop. It corresponds to a drop of 37.5%. The 2021/2022 harvest of conilon, on the other hand, is forecast to increase by 17.8% compared to the previous period and should reach 21.67 million bags.

Despite the significant drop in the total coffee harvest in Brazil indicated by the survey, the country will remain the largest producer in the world and the market should react with a rise in prices for the commodity.

Ricardo Tavares, president of the Montesanto Tavares Group.

KCNY and BRL/USD
In a week of high volatility, H1 broke the 131.75 usc/lb and recorded the minimum of 118.75 usc/lb. The stronger real, oscillated between 5.192 and 5.4627, operating this Friday at around 5.28 against the dollar. The estimates of the harvest break and the appreciation of the Real helped to pressure the Arabica in the market.

WEATHER
According to Somar Meteorology, in the last seven days, rainfall volumes above 75 mm have been recorded in the producing regions of Minas Gerais such as Sul de Minas and Cerrado Mineiro. In Mogiana Paulista, there were volumes above 20 mm.

For the next 20 days, there are forecasts of heavy rains between São Paulo and Minas Gerais, along with the weather conditions it may favor fungal diseases. Forecast for the next 5 days: Mogiana (75 mm), Cerrado (75 mm), South of Minas (100 mm).

DOMESTIC MARKET AND FOB
Many producers were out of the market this week, with a selective eagerness for more attractive businesses. According to Safras e Mercados, about 78% of Brazil’s 21/21 crop is already sold by producers. The general warehouses and the internal logistics present normal flow of operations. However, a truck drivers’ strike is scheduled for February 1st.

INTERNATIONAL LOGISTICS IN BRAZIL
The situation of low container availability in Brazilian ports seems to get worse, as many empty containers are being directed from Brazil to meet the high – and attractive – demand for freight between China and European/north American ports. In addition, the high export flow of Brazilian harvests and the low flow of imports, for the high dollar, are also factors responsible for the unbalance. We observed difficulties with the availability of containers with CMA CGM, Hapag-Lloyd, HMM, Evergreen, among others.

COVID-19 IN BRAZIL
Vaccinations in Brazil are scheduled to begin on January 20 or 21, pending ANVISA’s decision on requests for authorization for emergency use of vaccines from the Instituto Butantan and Fiocruz, respectively CoronaVac and AstraZeneca-Oxford.

Cases: 8,32 M
Deaths: 207 thousand
Recovered: 7.39 M

Let’s keep believing and investing in the coffee culture!
Take care,
Atlantica Coffee Team

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