In Brazil, the domestic physical coffee market is melting down, following the dollar\u2019s low and pressured by the advancement of the new Brazilian crop. The U.S. currency, which recently exchanged hands very close to BRL 6.00, ended up plummeting and is currently sold at BRL 5.08. This 15% decline, of course, ended up weighing against domestic coffee prices, inflated precisely by a very high dollar. Thus, the curves of domestic coffee prices accentuated the negative slope in early June, moving far away from the peaks reached in May.<\/p>\n\n\n\n
The most drastic\neffect was on better cups, previously highly valued in the face of scarcity of\nsupply. The arrival of the new crop and the dollar and ICE lows led to a very significant\ndecline in the price of these descriptions. The crop progress and,\nconsequently, the increase in the physical supply must keep negatively weighing\non prices. So much so that the appraisal of future crop prices are already much\nlower than for immediate delivery. Ideas for September 2020 are BRL 45 lower a\nbag than in the physicals, and even for September 2021 there is a decline by BRL\n5.00 per bag. <\/p>\n\n\n\n
(gr\u00e1fico: pre\u00e7o Sul de Minas) <\/p>\n\n\n\n
Good cup with 15% of defects in the south of\nMinas Gerais is indicated between BRL 495 and 500 per bag in the physicals. With\nthat, the market is sinking below the 5-year average and is leaving the region\nvery favorable for sales. This explains the decline in market liquidity. Fine cup\nfrom Cerrado and Mogiana follows the same behavior, sharply falling. Cerrado\u2019s\nfine coffee is pegged at BRL 515\n a bag in early June, against BRL 620 a few weeks ago.<\/p>\n\n\n\n
The weakest cups also fell, feeling the weight\nof the crop. However, the decline was much less significant. One reason is that\nthey did not rise like the best coffees. Another reason is that the harvest and\ndrying have proceeded with drier weather, which limits the availability of\nthese descriptions in the physical market, thus inhibiting a greater price depreciation.\nFinally, the aggressiveness of the local industry also helps support the prices\nof the weakest cups. Arabica rio with 20% of defects in Matas de Minas region\nis around BRL 370 a\nbag in early June.\n\nFinally, conillon, which ended up suffering only\na slight negative adjustment. Brazilian conillon remains aggressive in the foreign\nmarket (cheap in dollars), which helps reduce supply. The slower harvest pace also\nhelps support conillon from Esp\u00edrito Santo. Conillon type 7 is trading between\nBRL 343 and 345 per bag in Vit\u00f3ria.\n\n\n\n<\/p>\n","protected":false},"excerpt":{"rendered":"
In Brazil, the domestic physical coffee market is melting down, following the dollar\u2019s low and pressured by the advancement of the new Brazilian crop. The U.S. currency, which recently exchanged hands very close to BRL 6.00, ended up plummeting and is currently sold at BRL 5.08. This 15% decline, of course, ended up weighing against […]<\/p>\n","protected":false},"author":12,"featured_media":9025,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"footnotes":""},"categories":[102],"tags":[103],"commodity":[],"class_list":["post-15356","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-agribusiness-en","tag-coffee-en"],"acf":[],"yoast_head":"\n