The coffee bean market is made up of a global market with a total production of 27 billion dollars in 2020. Brazil leads the coffee bean export market with 4.97 billion pounds, while the United States leads the import market with 4.21 billion pounds. Brazil is experiencing an abrupt decrease in the amount of coffee beans that it produces due to climate change, which is affecting the production and export of the beans.
Global Market:
- Global Market Size: 27 B (2020)
- CAGR 6.7% Increase (Over the next 6 years, 2019 vs 2025)
Export Market:
- Brazil: 4.97 B
- Colombia: 2.45 B
- Vietnam: 2.24 B
- Honduras: 1.08 B (Exporting hefty amount compared to its production volume)
- Indonesia: 809 M
Import Market
- US: 4.21 B
- Germany: 2.74 B
- Italy: 1.23 B
- Japan: 1.05 B
- Belgium: 763 M
** China: 158 M (5.83% 5-year CAGR) - a country with increasing demand
Key Trends 2020/21-2021/22
Production:
- The production and export volumes are both expected to decrease due to instabilities in the coffee bean supply
- Due to climate change, Brazil is experiencing higher temperatures and lower precipitation which are causing miscarriage of most of the coffee plant flowers
- Another side effect of climate change is a delay in the coffee fertilization schedule. Growers typically follow well-planned crop maintenance schedules from September to March. In 2020, due to the lack of rain, fertilizer application has been delayed, and such delays may affect plants for two seasons to come
Export and Prices:
- According to the USDA, the Brazilian coffee export is projected to decrease by a whopping number of 10 million bags recording mere 35.22 million bags in MY 2021/22 due to lower product availability
- Market prices of coffee beans are expected to increase due to the abrupt decrease in supplies
- Brazil coffee does have some seasonality in prices, but the increase in average prices is caused by a supply shortage
- There is a gradual increase in the price from the huge discrepancy between the demand and the supply volume. The worldwide increase in demand and the instability of coffee bean supplies are causing the gradual increase