In W39 in the coffee landscape, Arabica coffee futures on the New York Stock Exchange (NYSE) fluctuated. On Monday, September 25, The Dec-23 contract dropped to USD 1.4880 per pound (lb) due to a strong increase in the United States (US) dollar, with the DXY index reaching its highest level in over six months, exceeding 106. On September 26, Arabica coffee futures rose to USD 1.5085/lb due to concerns about the dry and hot conditions in Brazil's main Arabica coffee areas, particularly in Minas Gerais, which received only 0.9 millimeters (mm) of rain, just 5% of the historical average. However, on September 27, Arabica futures declined to USD 1.4925/lb and further dropped to USD 1.472/lb on September 29. These declines were influenced by pressure from the exchange rate, as the USD strengthened by 1.24% against the Brazilian real, closing at BRL 5.05. The market continues to monitor Brazil's weather forecasts, as rain predictions negatively affect coffee prices.
Meanwhile, on September 25, the Nov-23 Robusta coffee contract decreased by USD 18 per metric ton (mt) to USD 2,443/mt, marking the fifth consecutive session of decline. Several factors contributed to this drop, including the strengthening of the US dollar, which promoted sales of Brazil's newly harvested coffee crop. Additionally, Robusta ICE inventory increased by 10.74% week-on-week (WoW), reaching 42,890 mt. However, on September 26, Robusta futures rebounded, rising by USD 13/mt to USD 2,456/mt. This increase was driven by the pressure of the coffee harvest in Brazil, with the favorable Brazilian Real exchange rate supporting coffee exports. On September 27, Robusta futures dropped by USD 9/mt to USD 2,447/mt, influenced by the exchange rate as the US dollar strengthened by 1.24% against the real. However, on September 28, Robusta futures rose by USD 22/mt to USD 2,469/mt, supported by a decrease in ICE inventory by 190 mt, totaling 42,780 mt.
In the first half of 2023, the European Union (EU) experienced a decline in coffee imports, with a 7.8% drop in volume and a 12.7% decrease in value compared to the same period in the previous year, reaching 1.42 million metric tons (mmt) and USD 5.78 billion, respectively. In Jun-23, the EU imported 232,300 mt of coffee, worth over USD 1 billion, showing a 7.5% drop in volume and a 0.6% dip in value compared to May-23. These figures also marked a significant decline of 9.2% in volume and 14.6% in value when compared to Jun-22. Notably, the EU's average coffee import price decreased for most foreign markets, except for Uganda, India, and Peru.
According to the Coffee Exporters Association (Cecafé), Brazil's coffee exports in Aug-23 significantly increased by 33.2% year-on-year (YoY) to 3.35 million bags. This export figure comprised 3.35 million bags of Arabica coffee, an 11.2% YoY increase, and 698,856 bags of Robusta coffee, indicating an impressive growth of 442% YoY. Moreover, the cumulative exports for the first two months of the 2023/24 crop year reached 6.05 million bags. This represented a substantial increase of 28.2% compared to the same period in the previous crop year (2022/23).
In the first seven months of 2023, Russia's coffee imports increased by 20% YoY, totaling 158 thousand mt. The primary coffee supplier to Russia is Vietnam, accounting for 46% of the imports, while Brazil contributes 20%. Other notable coffee suppliers include Indonesia, Uganda, India, Ethiopia, Honduras, the Netherlands, and Colombia.
Lastly, The Ethiopian government imposed a temporary ban on all coffee exports on September 25 due to changes in customs legislation. However, an update from the Ethiopian customs authorities now allows passengers leaving the country to carry up to 2 kilograms of coffee per person for personal use.