World Coffee Market and Trade: 2018/19 Forecast Overview

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World coffee production for 2018/19 is forecast 11.4 million bags higher than the previous year at a record 171.2 million primarily due to Brazil’s record output, according to the USDA’s “Coffee: World Markets and Trade” report, published June 2018.

With global consumption forecast at a record 163.2 million bags, exports are expected up in response to strong demand. Ending stocks are forecast to rebound following 3 years of decline.

USDA graph 2

Source: USDA

GLOBAL PRODUCTION HIGHLIGHTS

Brazil’s Arabica output is forecast to jump 6.0 million bags above the previous season to 44.5 million, with 80 percent of output coming from regions with trees in the on-year of the biennial production cycle.

Vietnam’s production is forecast to add 600,000 bags to a record 29.9 million as cooler weather and off-season rains helped stimulate coffee trees just prior to flowering and cherry setting.

Total output for Central America and Mexico is forecast unchanged at 20.3 million bags, though some countries in the region continue to struggle with the coffee rust outbreak that first lowered output 6 years ago.

Regional Pre Rust Coffee Production Levels

Source: USDA

Production has recovered in Guatemala, Honduras, Mexico, and Panama during this period but remains depressed in Costa Rica, El Salvador, and Nicaragua due to the effects of coffee rust (which is also featured in the report as a key industry issue).

Colombia’s production is forecast nearly flat at 14.5 million bags although output remains strong on favorable growing conditions.

Indonesia’s production is forecast to gain 500,000 bags to 11.1 million. Robusta output is expected to reach 9.7 million bags on favorable growing conditions in the lowland areas of Southern Sumatra and Java, where approximately 75% is grown.

US COFFEE CONSUMPTION

The United States imports the second-largest amount of coffee beans in the world, and is forecast to jump 2.4 million bags to 27.0 million. Ending stocks are forecast to gain 600,000 bags to 7.2 million.

The top U.S. coffee supplying countries are:

  • Brazil – 23%
  • Colombia – 22%
  • Vietnam – 15%
  • Honduras – 6%

COFFEE MARKET SNAPSHOT

Revised 2017/18:

  • World production is revised down from the December 2017 estimate by 100,000 bags to 159.8 million.
  • Vietnam is reduced 600,000 bags to 29.3 million due to harvest losses related to late rains.
  • Peru is up 575,000 bags to 4.4 million as rust damage was lower than anticipated. World bean exports are raised 800,000 bags to 111.2 million.
  • Ethiopia is up 600,000 bags to 4.0 million on greater exportable supplies.
  • Peru is 575,000 bags higher to 4.2 million on larger available supplies. World ending stocks are raised 100,000 bags to 29.4 million.
  • European Union is up 600,000 bags to 11.1 million.
  • Indonesia is raised from 42,000 bags to 835,000 due to higher imports and lower exports.
  • India is reduced 900,000 bags to 1.2 million on lower output and higher exports.
  • Brazil is down 300,000 bags to 2.3 million on lower production and higher consumption.

The next publication of this circular will be on December 14, 2018. Past editions are available here

Read the full USDA report here

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