Coffee Market Report: Robusta Leads Coffee Prices to Continuously Rise for the Sixth Consecutive Month
In the latest update from the International Coffee Organization (ICO), the March 2024 Coffee Market Report unveils a significant upward trend in coffee prices, marking the sixth consecutive month of ascent. Here’s a detailed breakdown of the key highlights:
ICO Composite Indicator Price (I-CIP)
The ICO Composite Indicator Price (I-CIP) averaged 186.36 US cents/lb in March, representing a notable 2.4% increase from February 2024. This surge brought the I-CIP to an 18-month high, reflecting a robust market sentiment.
Robustas Lead the Charge
Remarkably, robusta coffee prices surged to their highest level since October 1994, with an average of 169.43 US cents/lb. This surge underscores the growing demand for robusta beans, reflecting shifts in consumer preferences and market dynamics.
Regional Variations
While Colombian Milds witnessed a modest 0.4% increase, Other Milds remained stable in March 2024. However, the differentials between Colombian Milds, Other Milds, and Brazilian Naturals have fluctuated, signaling complex dynamics within the coffee market.
Arbitrage and Volatility
Arbitrage, measured between the London and New York Futures markets, experienced a notable retraction of 16.0% to 36.06 US cents/lb in March 2024. Additionally, intra-day volatility of the I-CIP increased marginally by 0.3 percentage points to 7.1%, reflecting the market’s responsiveness to changing conditions.
Global Green Bean Exports
February 2024 witnessed a significant uptick in global green bean exports, totaling 10.43 million bags, marking a 9.5% increase compared to the same period last year. Notably, Brazilian Naturals saw a remarkable 36.6% increase, while Colombian Milds and Other Milds also experienced growth.
Regional Export Trends
South America emerged as a key player in global coffee exports, with a notable 41.7% increase in shipments, primarily driven by Brazil. In contrast, exports from Asia & Oceania declined by 17.0%, largely influenced by decreased exports from Vietnam.
Shifts in Export Dynamics
While Robusta exports saw a slight decline, particularly from Vietnam and Indonesia, Colombian Milds and Brazilian Naturals experienced growth in February 2024. This highlights the evolving export dynamics and the varying performance of different coffee varieties.
Implications for Soluble Coffee Exports
Total exports of soluble coffee experienced a decline of 18.2% in February 2024, reflecting shifting consumption patterns and market demand. However, Brazil maintained its position as the largest exporter of soluble coffee, accounting for a significant portion of global exports.
Certified Stocks and Market Stability
Certified stocks on the New York and London futures markets fluctuated, with notable changes observed over recent months. These stocks play a crucial role in maintaining market stability and ensuring the smooth functioning of futures trading.
Supply-Demand Balance
Despite fluctuations in production and consumption, the coffee market maintains a delicate balance, with supply and demand dynamics influencing price movements. Understanding these dynamics is essential for stakeholders across the coffee value chain.
The March 2024 Coffee Market Report provides valuable insights into the evolving landscape of the global coffee industry, offering stakeholders key information to navigate market trends and make informed decisions. As coffee prices continue to rise, attention turns to factors such as climate variability, supply chain resilience, and consumer preferences, shaping the future trajectory of the coffee market. Stay tuned for further updates as the industry adapts to emerging challenges and opportunities.
