Global coffee prices set for shift in 2024 due to supply changes
2023.11.01 11:24
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The global coffee market is expected to experience significant shifts in the coming year, according to the World Bank’s Commodity Markets Outlook. The report predicts a decline in Arabica and Robusta coffee prices in 2024 due to increased supply from key producers Brazil, Vietnam, and Colombia.
Arabica coffee prices saw a 14% drop in Q3 of 2023 and are currently around 30% lower than last year. This trend is anticipated to continue into 2024 as Brazil and Colombia are ramping up their production by approximately 14%. These two countries account for about 60% of the global Arabica output.
Despite the overall downward trend, Robusta coffee prices rose slightly by 2% during the September quarter and are over 17% higher than last year. The robusta market is projected to remain tight due to reduced production in Indonesia and Uganda. However, Vietnam’s increased output, which contributes to more than two-thirds of global robusta production, could potentially ease this tightness.
The report also highlights potential factors that could impact these price trends. An intensification of El Niño conditions and a potential global economic downturn could have significant effects on coffee prices.
In India, Arabica prices have followed the global trend with a decline of over a third. The farmgate prices of Arabica parchment stand at ₹10,900-11,200 per 50 kg bag, while Arabica cherry prices are at ₹6,450-6,650 levels. Conversely, Robusta prices remain firm with parchment prices around ₹10,000-10,400 levels and cherry prices hovering around ₹5,900-6,200 levels.
As the global coffee market adjusts to these changes in supply and demand dynamics, producers and consumers alike will need to keep a close eye on these evolving trends throughout 2024.
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