World heads for fourth year of shortages for instant coffee beans

Published 2024년 5월 23일

Tridge summary

Volcafe Ltd, a major coffee trader, forecasts a fourth consecutive year of deficits for robusta beans, used in instant coffee, due to dry weather in Vietnam, the world's top producer. The 2024/25 season is expected to see the lowest crop in 13 years, with only 24 million bags. This, along with the expansion of durian trees and reduced fertiliser use, has led to a global robusta deficit of 4.6 million bags. Despite these challenges, demand for robusta beans, particularly in instant coffee, remains strong in emerging markets. However, prices are expected to rise to address the deficit, which could lead to a shift towards arabica beans. The arabica supply outlook is brighter, and global coffee supplies are still expected to exceed consumption in the 2024/25 season.

Disclaimer:The above summary was generated by Tridge's proprietary AI model for informational purposes.

Original content

(May 23): Volcafe Ltd, one of the world’s top coffee traders, sees an “unprecedented” fourth year of deficits for robusta beans used in instant coffee, as top producer Vietnam continues to face dry weather. The crop potential for Vietnam in the 2024/25 season is seen at 24 million bags, the lowest in 13 years, according to a Volcafe report seen by Bloomberg. Poor rainfall in Vietnam has caused “irreversible damage” to coffee blossoms, while lower fertiliser use and the expansion of durian trees at the expense of coffee acreage have also weighed on production. Volcafe forecasts a global robusta deficit of 4.6 million bags in 2024/25, smaller than the nine-million-bag deficit seen in the previous season. Each bag of coffee is 60kg. Supply tightness has fuelled a robusta rally this year, with futures traded in London surging to a fresh intraday high above US$4,300 (RM20,232) in late April. Futures have since pared back, but “a solution to the current robusta deficit requires higher ...

Source: Theedgemarkets