Brazilian farmers wake up to their own specialist coffee

Daniel Gallas – BBC News, 10/02/2015

We drive up the hills in his pickup truck to see farmers harvest the coffee beans in the vast valley around us. Coffee has been the economic backbone of this region – on the border between the Brazilian states of Minas Gerais and Espirito Santo – for more than a century.

But after years of a commodity-fuelled boom, economies like Brazil are having a hard time adjusting to slower global demand and lower prices.

Over the decades, the Lacerda family has known fortune and poverty, with their wealth always oscillating around coffee. Droughts, government policies, global consumption, currency problems – these were blessings and curses that determined the fate of the Lacerdas.

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Brazil’s coffee growers seen holding back beans on minimum price

Isis Almeida – Bloomberg, 05/03/2013

Coffee producers in Brazil, the world’s largest grower, are holding back beans on speculation the government will raise the minimum price for the commodity, according to Rio de Janeiro-based Flavour Coffee.

The Agriculture Ministry planned to announce a new benchmark in Brasilia yesterday and then canceled. The minimum price guarantees growers receive enough money to cover costs of production. When prices fall below it, the government takes action including buying stockpiles or paying producers the difference between the minimum price and market prices.

“It seems producers are holding back offers on hopes about the announcement of higher minimum prices,” Flavour Coffee said in a report e-mailed yesterday.

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Record Brazil coffee crop cuts costs for Starbucks: commodities

Marvin G. Perez, Patricia Laya – Bloomberg Businessweek, 12/04/2012

Record coffee harvests in Brazil, the biggest grower, are compounding a global glut of arabica used by Starbucks Corp. (SBUX) and Dunkin’ Donuts Inc.

Brazilian farmers will reap 50.8 million bags in 2013, a record for a so-called low-crop season, according to the median of nine analyst estimates compiled by Bloomberg. The harvest reached 55.9 million 60-kilogram (132-pound) bags in 2012, an all-time high for a peak year. Output usually drops in alternate years because of growing cycles. Prices may fall 14 percent to $1.311 a pound by June 30, the average of 14 predictions shows.

Futures slumped about 50 percent since May 2011, as the highest prices in 14 years spurred Brazilian farmers to boost supply. Their exports jumped 54 percent to $8.7 billion in 2011. The flood of beans has continued and stockpiles tracked by the ICE Futures U.S. exchange are headed for the biggest annual gain in more than a decade. Rising costs and concern that economies are slowing encouraged roasters and consumers to favor cheaper robusta beans.

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Coffee skyrockets as prediction of smaller harvest in Colombia offsets Brazil’s robust harvest

The Washington Post/AP, 09/10/2012

The price of coffee is skyrocketing on speculation that Colombia’s harvest will be smaller than expected for the fourth straight year.

Coffee for December delivery jumped 10.6 cents, or 6.5 percent, to finish at $1.7365 per pound. That’s the highest level since early August.

Although Brazil’s coffee crop appears headed toward a robust harvest, Colombia’s crop was hampered by heavy rainfall that caused delays earlier in the season. Colombia could produce a smaller-than-expected crop for the fourth consecutive year, Barclays Capital analysts said in a report on Friday.

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Brazil’s coffee consumption up 3 percent

The Business Recorder, 8/14/2012

Brazil guzzled almost 20 million bags of coffee in the 12-month period through April, the roasters’ association ABIC said on Friday, a rise of about 3 percent that is unlikely to be achieved again in the next 12 months. The world’s top coffee producer is also the world’s No 2 consumer, drinking the equivalent of roughly 40 percent of what it produces. The local coffee industry expects the country could eventually overtake the top consumer, the United States.

“Brazilians are consuming more cups of coffee per day and diversifying the ways they drink it during the day, with espresso coffees, cappuccinos and other combinations with milk, on top of filter coffee drunk at home,” said Marcio Reis Maia, ABIC’s director of Research and Information.

These new formats are also boosting demand for higher quality arabicas as a burgeoning middle class acquires a taste for better brews and splashes out on espresso machines made for the home that are now all the rage in Brazil’s chic shopping malls. That extra demand will not go unnoticed by the global coffee market as roasters drain stocks and reconfigure blends to cope with the scarcity of high quality arabicas, due in part to a run of poor harvests from prestigious grower Colombia.

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