The flow of coffee sales in the Brazilian physical market increased in September and the first half of October. Soaring prices and the aggressiveness of the domestic industry for conillon coffee boosted trading. However, despite the good progress, sales continue slow, with growers splitting lots. This year’s smaller crop helps explain this percentage performance.
Growers must keep staggering positions, especially arabica sellers, betting on the off-season and lower physical availability. Prices very close to recent highs collaborate with this stance of growers.
Until October 15, sales of the 21/22 crop reached 68% of the expected production, according to SAFRAS monthly monitoring. The flow of sales continues above the same period last year, when 64% of the crop had been sold by growers, and far above the 5-year average for the period, which is around 56% of production.
Arabica sales reach 65% of Brazil’s 2021 crop, in line with the same period last year, but well above the average of 54% for the period. Both trading companies and growers were more focused on delivering coffee from sales in advance of Brazil’s 2021 crop, which took away some interest in new sales, particularly in Cerrado and south of Minas Gerais and in Mogiana, in the state of São Paulo. The high percentage of commitments along with more capitalized growers must reduce both supply and the physical market liquidity, accentuating the sensation of off-season.
Conillon sales have been quite accelerated due to the aggressiveness of local roasters and the escalation in prices, with conillon even surpassing the level of BRL 800 per bag. Conillon sales reach 73% of Brazil’s 2021 crop, up 10% from the previous month. Sales easily surpass the 64% sold in the same period last year and remain far above the 61% of the five-year average for the period.