Coffee Bean Reserves Have Reached 20-Year Low
Bad weather, rising fuel costs, and covid contribute to fewer beans and more expensive brews.
Of all the shortages that I have reported in recently, a possible coffee bean shortage must be ranked among the most dire.
It turns out coffee bean reserves have plunged to their lowest since the 2000s.
…Stockpiles of high-end Arabica beans, a favourite of artisan coffee shops and chains such as Starbucks, totalled 1.078 million bags, or about 143 million pounds, according to data released Monday by the ICE Futures US exchange.”
Brazil is the world’s top coffee producer. By the 1820’s it was already producing thirty percent of the world’s coffee. Today, it produces a third of the world’s coffee with 40 to 60 million bags annually. However, its global demand for coffee has been put in jeopardy due to factors such as the ongoing COVID-19 pandemic and climate change.
In part, the stockpile took a hit because Brazil produced less coffee than expected.
Brazil’s government on Tuesday said that farmers in the world’s largest coffee producer will harvest 55.74 million bags in 2022, 16.8% more than in the previous year, but an amount that is smaller than most in the market expect.
Brazil’s coffee production is key to balance the global supply. A smaller-than-average crop could cause a deficit and sustain coffee prices around current 10-year highs.
…HedgePoint coffee analyst Natalia Gandolphi said the Conab [Brazil’s food sully agency] number would trigger a deficit for global arabica of around 1 million to 3 million bags and flat balance or a deficit for global production, considering both arabica and robusta.
“Would be a first in recent years for the coffee market, given that consecutive years of deficit/flat balance have not been seen since 2008-10,” she said.
“It does confirm the general pessimism about the 2022 on-cycle crop, which prior to the frost had been thought might be a new record,” said Ryan Delany, chief analyst at Coffee Trading Academy, LLC.
Weather conditions and supply chain issues are contributing factors to the deficit in the stockpile. The effects of the drought were being felt last fall.
The “world price of coffee” has surged 21.6 per cent this year to $3.65 a kilogram, according to IBISWorld.
The dataset’s annual figures are the average of monthly prices of arabica and robusta green, or raw, coffee beans.
“We have not seen that type of price peak since 2014,” said Suzy Oo, senior industry analyst at IBISWorld.
What’s behind the price rise? Climate change-related weather events have affected key coffee-producing regions and global supply chain issues are hurting importers.
Drought and severe frost are estimated to have destroyed about 20 per cent of Brazil’s coffee plants.
More recently, the surging price of fuel has impacted coffee bean prices.
[Coffee roaster Matt] Swiatkiwsky said the price for a pallet of coffee had almost doubled from about $7,000 to $13,000 over the past two years.
“Freight would be the big one for us with the cost of fuel going up,” he said.
Mr Swiatkiwsky does not expect the price of coffee to fall anytime soon, if ever, because some businesses are “just getting by”.
“In all honesty, I think a lot of these prices should have been passed on some time ago,” he said.
Finally, blame for the coffee crisis can also be placed on covid. The real long-covid effect is that employees do not want to go back to work. There is now a labor shortage among coffee harvesters.
Farmers of the famed Blue Mountain coffee have, among other infrastructural challenges, lamented what they believe to be the scarcity of workers needed to drive seasonal production.
Like several other industries locally, which have also been plagued by labour shortage, some coffee farmers have cited a mass exodus of their workers, which they say has worsened since the outbreak of the novel coronavirus pandemic.
Ronald Rodney, a coffee farmer who operates the Radonor Estate situated in St Thomas near the peak of the world-renowned Blue Mountains, said that his numbers are now down to six, moving from over 30 workers in previous years.
“COVID has changed a lot of things. We have seen the loss of a number of our more seasoned workers as many of them moved on to engage in other ventures during the lockdown and slow periods. Since then, several of them have not returned. Those we have now are fairly new and sometimes they don’t even stay for too long as coffee harvesting requires long hours and a lot of people can’t manage, so what we have found is that the newer workers will sometimes come for a day when they need quick cash and then they do not return,” he said during an interview with the Jamaica Observer.
There are many dreadful, unintended consequences of the covid lockdowns. Struggles to find qualified workers willing to work essential jobs may be one of the worst and longest-lasting.
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Comments
I did not have “Coffee Zombies” on my 2022 Bingo card.
Darn.
Isn’t it curious that under the Biden Administration, it’s only COMMON, LEGAL stuff suffering shortages? No shortages of crack, fentanyl, illegals, terrorists, or even pot. Maybe the winning move here is to make coffee, gas, formula, lumber, and food illegal — then our economic problems will be solved.
“Huy Fong Foods suspends production of sriracha due to ‘severe’ chili shortage”
Aux barricades, mon freres!
One thing is certain, the Fourth Reich be very efficient in addressing global over-population. Transhumanism will require the elimination of the normal human species as Davos Man focuses on transforming the elites into a new species of immortal cyborgs. There just isn’t enough tech to go around nor enough time to waste on the protestations of “species-ists” and their cyborgphobic bigotry to include everyone. They will be ditching the inclusiveness and diversity when the time comes.
They already have. See the coming famine in Africa and central Asia as a result of a series of wholly irresponsible policies re Ukraine.
No they are not. The coming famine is a direct result of the war on fossil fuel. The global fertilizer shortage already meant that the African harvest would be down 100 MILLION tons. Even if there had been no war in Ukraine – a Billion more people would be facing chronic starvation.
The Ukraine war, the Avian flu, the Swine encephalitis and bad winter harvests in the USA and China all are aggravating the Famine. But, the Famine will not end until we start producing enough Natural Gas that Fertilizer becomes available again – or – hundreds of millions of people die from starvation.
I don’t disagree with most of that but to dismiss the Sanctions on Belarus and Russia which together produce roughly 20% of exported fertilizer seems wrong. The richer buyers will source product the poorer buyers won’t be able to do so. The poorer buyers are located by and large in poorer countries in Africa and central Asia.
In any event the Davos crowd doesn’t really care if these folks starve irrespective of the cause. Here the cause is one of the Davos/WEF crowds making.
Frankly, I am sick of hearing about poorer countries. They being poor is in large part self inflicted, and even if that was not the case, trying to help them does little long term good. I don’t think that we should go out of our way to make them miserable, I also do not thing we should feed their massive corruption. Feeding people who consistently reproduce in excess and then beg for handouts.
Ok fair enough. These nations will near the brunt of the folly and face severe food shortage if not famine. Hungry people are desperate. Desperate people are dangerous. If only from a self interest standpoint we may want to avoid creating a mass of desperate folks.
For people who think my comments are over the top…
https://www.americanthinker.com/blog/2022/06/the_great_reset_aims_to_put_us_all_in_mouse_utopia.html
Just read what they say. A few weeks ago, Elon Musk walked out of a panel discussion that included the Google Twins when they started talking about the inevitability of transhumanism and over-population (Bill Gates’ favorite subject).
Davos is Klaus Schwab’s insane vision of the Fourth Reich. He inherited his royal Nazi lines from the father and grandfather, certified Nazis.
Neither his father nor his grandfather were “certified nazis”. You are a liar.
You are an insufferable ignoramus. His grandfather was a member of the Nazi Party in WWII and his father was a certified acolyte when he took over the business. Now go back to your basement and stick to pretending your are a lawyer.
Leslie,
Respectfully, Covid isn’t to blame. The blame rests with the foolish and irresponsible policies crafted by our political leadership in RESPONSE to Covid. To assert that Covid is responsible is to remove the focus of accountability from where it belongs; political leadership, the public health community, legacy media who trumpeted the narrative without any examination and tech co who censored, purged and deplatformed any who spoke up in opposition to the foolish response.
The cited article also blames frost as “climate change”….good grief.
Don’t you understand that all bad things in this world are a result of climate change? Get your head right….or else!
*raises hand*
Isn’t that just the weather?
I’m a simple man.
My thoughts exactly. Severe frost in Brazil = catastrophic anthropogenic global warming? Who knew?
Of course, this ignores the fact that the very existence of COVID is also due to foolish and irresponsible policies crafted by our political leadership.
Almost certainly true. IMO where we tend to lose people in paying attention to our arguments is when we stray from provable facts and the discussion at hand. We need to remain focused on persuasion one bite at a time v shoving the entire apple at people.
In this case Rona. The virus didn’t set in place policies whose ramifications we continue to field; the public health community, elected leaders, legacy media and tech co either implemented, sustained or acted as propagandists for these foolishly bad policies in response to Rona. None of that is in any way controversial to anyone who might be persuaded. The kool aid drinkers are a lost cause. Ignore them and don’t conflate the audience who might be persuaded with the intolerant kool drinking true believers.
We don’t have to win an argument about lab leaks whether intentional or accidental to sustain a straight argument about the extremely poor policy response. Raising this issue as a precondition for entry into our tent hurts us. We should attempt to convince them one step at a time. One argument at a time. Going full bore before they digest one portion turns them off.
Bingo. I find that the finer the grain of the red pill, the more easily it goes down. I don’t have to argue about lab leaks to notice that COVID-19, though nasty, is not as bad as we originally thought, and yet our politicians perpetuated foolishly draconian measures.
Also, they not only shunned the wonderfully effective old drugs and drug cocktails devised by our clinicians, they slandered intelligent people of good will, who turned out to be right.
I’m not arguing for whether lab leaks were accidental or deliberate. I’m claiming (and there is adequate proof) that we funded the very development of this scourge when we A, ethically should not have, and B, legally should not have.
AWWWWW Didjya HAFF ta say THAYAT??!!??
You are spot on, but nobody that’s “anybody” wants to hear that.
cliamte change is wearing thin as a universal punching boy, too. They who push that meme wilfully “forget” things like the Midaeval Warming Period, when Greenland was, uhm, how can I say it,GREEN? As in green things growing everywhere? Archaeologists have uncovered seaside villages dating to the early second milennium where roses, grapes, sheep, pasture, grain crops, were evident, in places that are now typically under dozens of feet of hard packed ice and snow. Cliate change? If it never happened we’d be living in that kind of world. I LIKE climate change. Where I live would be froen solid and I don’t like living in olaces that cold.
Who killed the electric car? Why no one, it’s run on 95% coal!!!!
https://pjmedia.com/vodkapundit/2022/06/08/chevy-volt-short-circuit-virtue-signaling-gm-exec-gets-owned-on-clean-energy-n1604083
In the early 80s there was a killing frost in Brazil and coffee supplies dried up and prices rose hugely. Restaurants suspended the second free cup doctrine. Yet you could buy all the coffee you wanted in the supermarket, albeit at $10 a pound or so. An example of price working to fix a problem.
It’s the same thing today only for lots of products. Pay people not to work and a lot of supply dries up. You can’t fix it with handing out money.
Robusta. Try it. They are stronger than Arabacia. I suggest looking for labeled Vietnam coffee. I do not believe there is a shortage there.
Just I’d freedom
How many of the coffee pickers migrated from South America to America in the past two years. How many are in Colombian and Peru picking coca plants. Picking coffee is hard work and doesn’t pay that well.
Enough with the bad news. I cannot take this daily grind. There are no grounds for blaming this on Covid. I no longer want the unfiltered truth. Perhaps this is just another ripple percolating through the supply chain. Let the bean counters figure this one out,
I like my coffee like my women – hot, black, sweet and just waiting for that cream.
No coffee reserves?!? OK, NOW we can panic.
Hmmm maybe the few tonines I happen to have in storage might be a good thing……. I suppose I will find out.
Is there any topic or they don’t throw in climate changes as a cause?
There’s a climate change solution for this. Plant coffee in the areas that now have the best weather for coffee. I hear some French grape growers have moved to England, so maybe coffee can be grown somewhere else.
I have coffee plants that bloomed, this year, and made a few beans.
I want that cup.