In W31 in the coffee landscape, Arabica coffee futures on the New York Stock Exchange (NYSE) experienced fluctuations. On Monday, July 31, the Sep-23 contract surged by 4.3% to a one-month high of 164.65 cents/lb, and the rise persisted on August 2, hitting 166.95 cents/lb. Even with the harvest advancing in Brazil, the producers' hesitation to sell resulted in ICE's Arabica coffee stocks decreasing to an eight-month low of 528 thousand bags. This was influenced by the strong Brazilian real, which caused farmers to hold back on coffee exports, anticipating better prices. However, on Thursday, August 3, Arabica futures dropped to 164.75 cents/lb due to pressure from exchange rates, with the dollar rising more than 1%. On Friday, August 4, coffee futures dropped further to 161.35 cents/lb, influenced by favorable harvest conditions in Brazil, where more than 60% of the coffee has been harvested, according to Cooxupé.
Similarly, Robusta coffee displayed fluctuations during the week. On Monday, the Sep-23 contract rose by USD 33/metric ton (mt) to USD 2,621/mt due to declining coffee exports from Vietnam. July's coffee exports from Vietnam dropped significantly by 32.1% month-on-month (MoM) and 6% year-on-year (YoY), causing concerns about potential supply shortages in consumer markets, especially since the global demand for robusta coffee is rising. Additionally, Vietnam's coffee harvest in 2023 is expected to drop by more than 7% YoY to 1.67 mmt, the lowest in four years. On Tuesday, Robusta futures increased by USD 14/mt to USD 2,635/mt, followed by a USD 39/mt rise on Wednesday, reaching USD 2,674/mt. However, this positive trend was countered by a drop of USD 29/mt on Thursday to USD 2,645/mt and a further decrease of USD 33/mt on Friday to USD 2,612/mt.
In July, Brazil's total coffee export volume (green and soluble) reached 2.48 million 60-kg bags, a drop of 5.1% YoY from 2.61 million bags in Jul-22. Correspondingly, export value declined by 11.8% YoY, dropping from USD 659.47 million in Jul-22 to USD 581.56 million in Jul-23. Furthermore, coffee export volume for the first seven months of 2023 registered a substantial 15.30% YoY drop, amounting to 18.21 million bags compared to 21.49 million bags in the same period of 2022. Export revenue also saw a significant decline of 24.20% YoY, decreasing from USD 5.56 billion in 2022 to USD 4.22 billion in 2023.
Lastly, Uganda's coffee exports in June totaled 563,832 60-kg bags, worth USD 90.56 million, representing an increase of 6.31% YoY in volume and 8.08% YoY. These exports consisted of 489,597 bags of Robusta coffee valued at USD 73.88 million and 74,235 bags of Arabica coffee valued at USD 16.68 million. This growth can be attributed to a successful harvest in the Southwest region and favorable global coffee prices, encouraging exporters to release their stocks. Italy retained its dominant position as Uganda's main export market with a 37.68% share, slightly higher than the previous month's 37.34%.
