Colombian Coffee Prices Increase To Highest Since October 2022 On Strong International Rise
Colombian Coffee Prices Increase To Highest Since October 2022 On Strong International Rise
Bogota (Coffee Network)- Colombia’s local coffee prices reached the highest level yesterday to a level not seen since 25 October 2022 as international coffee prices continued to be high.
Local coffee prices reached as high as COP2.246 million pesos for two bags of 125kg of parchment coffee, the highest level since 25 October 2022 when prices closed at COP2.252, the coffee growers federation said.
This reference of Colombian coffee, which is listed on the New York Stock Exchange as Contract “C”, closed at one of its highest values in 10 years, standing at US$2.69 per pound.
The drought conditions and lack of rain in Brazil, the largest coffee producer in the world, is one of the factors that have influenced this increase in the value of Colombian coffee. The hot climate in this country has affected production, damaging crops and greatly limiting harvesting capacity.
Local coffee prices are calculated daily taking into consideration the fluctuations of the Colombian peso to the dollar, international coffee prices and the premium for Colombia coffee. High local coffee prices are allowing coffee growers to pocket gains as producing the same 125kg of parchment coffee costs around COP1.250 million.
High coffee prices come at a time of coffee production has been hit by the extended droughts that damaged beans. Colombia has officially began picking its main harvest, the general manager of the coffee growers federation said on his X account.
Bahamon stated that the harvest of the second half of the year is the country’s largest. The harvest of the second half of the year weights about 65% of the total and it is collected in some areas of Huila, Colombia’s largest coffee-producing province, Caldas, Risaralda, Antioquia, Qundio, Valle del Cauca, mainly.
In his posts, Bahamon showed a trucked fully loaded with ripened beans in the town of Salgar, in the eastern province of Antioquia.
“I send greetings to the coffee growers of Colombia who, in the midst of climatic difficulties, do not lower their guard and with their work will continue to contribute to the economic recovery of the country,” he said.
Coffee plantations have endured two consecutive months of drougths, but rainfall is expected to begin later this week onwards to ensure the proper filling of the grains, Bahamon said. Colombia will face a weakened-than-expected La Niña beginning in October, which has heightened the alarms as low reservoirs levels may lead to a potential electricity rationing in early 2025.
Earlier this week, Bahamon revised upward the country’s coffee output target to around 13 million bags of 60-kg as droughts earlier this year prompted improved flowerings.
FNC has initially expected coffee production of around 12 million bags of 60-kg, but water stress linked to the El Niño weather phenomena earlier this year, prompted better-than-expected flowerings. In 2023, Colombia produced 11.3 million bags, which implies a recovery of about 1.7 million bags higher.
“In the 12-month period, we already broke the threshold of 12 million (bags). Without having a precise harvest for the second half, we should be producing around 13 million bags,” he told reporters during a presser.
Colombia is expected to export around 12 million bags in 2024, up from 10.5 million in 2023. Some 1 million bags will stay in the local market.
In coffee year 2023-2024, Colombia, the world’s third-largest producer, is seeing producing 12.6 million-12.7 million bags, which is higher than the initial estimate of 12.5 million bags.
In the 2023-2024 coffee year, exports should reach around 11.7 million bags, Bahamon noted.
By Diana Delgado
