Porto Alegre, November 25th, 2022 – The USDA attaché has revised the Colombian coffee production, which has been severely punished by excess moisture in the last two years, as a result of the La Nina phenomenon. Meteorological models indicate that moisture must remain high at the end of 2022 and beginning of 2023, which could hinder the harvest and processing of the 22/23 Colombian crop. The 21/23 production dropped to 11.80 mln bags, down 9.2% from the official projection of 13 mln bags in June. The attaché also reduced the forecast for the 22/23 cycle, which started last October, from 13.00 to 12.60 mln bags, down 3.1%.
The combination of low stocks at the end of the 21/22 cycle with the lower production in 22/23 reduces the Colombian coffee supply, which negatively affects the export perspective, reduced to 12.70 mln bags, against 13 mln bags initially expected. Even with the drop in the external flow, stocks must fall to 460 thousand bags, which reduced the stock-to-consumption ratio to 21%. It is good to remember that in 20/21 this ratio was at 59%. The frustrated production of the last two seasons explains the tight supply.
Domestic consumption is not expected to react, given the weak signals from the Colombian economy, aggravated by the inflationary spiral. The fact is that 96% of Colombian production are exported. The United States is the main destination for Colombian coffee, accounting for 40% of the total. Then comes the European Union. Regions that are at risk of recession and falling income.
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