Date: 24/09/2024
Introduction
Brazil, the world’s largest coffee producer, is poised for a notable increase in its coffee production in 2024. Favorable weather conditions and a rise in international demand are expected to drive a 5.4% increase in total coffee production, reaching an estimated 58.08 million bags of processed coffee (USDA Foreign Agriculture Service).
This growth is further supported by the National Supply Company (CONAB), which confirms a similar 5.5% increase over the previous year. The expansion in coffee production spans both Arabica and Conilon (Robusta) species, with significant growth expected in key regions such as Minas Gerais, Espírito Santo, and São Paulo. Despite the positive outlook, Brazil’s coffee industry faces challenges from climatic conditions, particularly high temperatures and drought, which could impact yields and global coffee prices.
This report delves into the various aspects of Brazil’s 2024 coffee crop, including production forecasts, regional insights, export trends, and the impact of climatic conditions.
Table of Contents
- Production Overview: How is the Coffee Crop in Brazil in 2024?
- Brazil Coffee Production Increase and Forecasts for 2024
- Area Under Cultivation
- Regional Production Insights
- Minas Gerais
- Espírito Santo
- São Paulo
- Bahia and Rondônia
- Productivity and Yield
- Historical Context and Weather Impact
- Export Trends and Revenue
- Brazil’s Coffee Export Trends and Revenue Growth 2023/24
- Export Volume and Growth
- Revenue from Coffee Exports
- Key Export Destinations
- Market Dynamics and Competitive Position
- Future Projections
- Climatic Conditions and Their Impact on Brazil’s 2024 Coffee Crop
- Temperature Sensitivity and Its Effects on Brazil Coffee Crop 2024
- Drought Conditions and Rainfall Distribution in Brazil Coffee Farms
- Regional Impacts on Brazil Coffee Crop 2024
- South of Minas Gerais
- Espírito Santo and Paraná
- Impact on Coffee Prices
- Future Projections and Concerns for Brazil Coffee Crop 2024
Production Overview: How is the Coffee Crop in Brazil in 2024?
Explore Brazil’s 2024 coffee production outlook with a projected 5.4% increase, favorable weather conditions, and rising demand.
Production Overview: How is the Coffee Crop in Brazil in 2024?
Brazil Coffee Production Increase and Forecasts for 2024
In 2024, Brazil’s coffee production is projected to experience a significant increase. According to the USDA Foreign Agriculture Service, the total coffee production is expected to rise by 5.4%. Estimated 58.08 million bags of processed coffee. Favorable weather conditions and higher international demand are driving this increase. Particularly due to production shortages in other key coffee-producing countries like Vietnam.
The National Supply Company (CONAB) has also confirmed these projections, estimating a 5.5% increase in the 2024 coffee harvest compared to the previous year. This growth is reflected in both Arabica and Conilon (Robusta) coffee species. Arabica production is expected to total 40.75 million bags, a 4.7% increase from 2023. Robusta production is projected to rise by 7.2% to 17.33 million bags.
Area Under Cultivation
The total area allotted for coffee growing in Brazil in 2024 is estimated at 2.25 million hectares. Representing a 0.8% increase compared to the previous harvest. This area includes 1.92 million hectares of producing crops, which is up by 2.4% from 2023. However, the area in developing stages has decreased by 7%, totaling 336,300 hectares (Brazilian Farmers).
Regional Production Insights
Minas Gerais
Minas Gerais, Brazil’s largest coffee-producing state, is expected to produce 29.18 million bags in 2024, marking a slight 0.6% increase compared to the previous season. The increase is primarily expanding producing area and the positive biennial cycle, as well as improved crop conditions.
Espírito Santo
Espírito Santo is projected to see a substantial increase in coffee production. Estimated totals of 15.01 million bags, up by 15.4% from the previous year. This includes both Conilon coffee, which is expected to produce 11.06 million bags (a 9% increase). As well as Arabica coffee, projected to yield 3.95 million bags, a significant 38.2% increase from the last cycle.
São Paulo
In São Paulo, coffee production is expected to reach 5.4 million bags of Arabica coffee, representing a 7.4% increase compared to 2023. The growth is attributed to favorable weather conditions and improved crop management practices (Brazilian Farmers).
Bahia and Rondônia
Bahia is projected to produce 3.61 million bags, a 6.4% increase from the previous harvest. Rondônia, known for its Conilon coffee, is expected to yield 3.19 million bags, marking a 5.1% increase compared to 2023.
Productivity and Yield
The national average coffee production in Brazil for 2024 is projected at 30.3 bags per hectare, approximately 3% higher than the previous harvest. Arabica coffee productivity is estimated at 26.7 bags per hectare, up by 2% from the 2023 crop. Conilon coffee productivity is expected to reach 44.3 bags per hectare, a 6.2% increase from the previous year.
Historical Context and Weather Impact
The 2021 and 2022 coffee harvests in Brazil were characterized by lower productivity levels due to adverse weather conditions, including droughts and frosts. These conditions significantly impacted Arabica coffee growing regions, leading to a decrease in yields. The situation improved in 2023, allowing productivity to return to higher levels. Despite the positive outlook for 2024, the current crop is still expected to be below the record levels reached in 2020 and 2018, which were 63 million and 61.6 million bags, respectively (Comunicaffe).
Export Trends and Revenue
Brazil’s coffee exports will likely increase in 2024, driven by higher production and favorable international market conditions. In 2023, Brazil exported 39.2 million 60-kilo bags of coffee, a slight drop of 1.3% from the previous year due to stock shortages at the start of the year, following adverse weather in 2021 and 2022. However, exports are expected to rise in 2024.
This projected increase in production and exports is expected to boost revenues for Brazil’s coffee industry. Estimated revenue for 2024 is US$10.7 billion, reflecting increased production and relatively high international coffee prices.
Conclusion
The 2024 coffee crop in Brazil is set to experience a notable increase in production, driven by favorable weather conditions, higher international demand, and improved crop management practices. The total area under cultivation has expanded, and productivity levels have risen, particularly for Arabica and Conilon coffee species. Regional production insights indicate growth across several key states, contributing to the overall positive outlook for Brazil’s coffee industry in 2024.
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Brazil’s Coffee Export Trends and Revenue Growth 2023/24
Brazil’s Coffee Export Trends and Revenue Growth 2023/24
Export Volume and Growth
In the 2023/24 marketing year, Brazil’s coffee exports reached a historic volume of 47.3 million 60-kg bags, marking a significant increase of 32.7% compared to the 35.632 million bags recorded from July 2022 to June 2023 (Coffee Geography). This record-breaking performance underscores Brazil’s dominant position in the global coffee market, facilitated by favorable weather conditions and increased production, particularly of Arabica coffee.
The Port of Santos played a crucial role in this export surge, handling 32.607 million bags, which accounted for 68.9% of the total volume traded. However, this is the lowest percentage of representation for the Santos port in history, indicating potential logistical challenges (Coffee Geography). The Rio de Janeiro maritime complex and the Port of Paranaguá also contributed significantly, with the former increasing its share to 28.1% of exports.
Revenue from Coffee Exports
Brazilian coffee exports generated an unprecedented US$ 9.826 billion in the 2023/24 season, a 20.7% increase from US$ 8.142 billion in the 2022/23 season (Coffee Geography). This revenue growth reflects the higher export volumes and the increased value of coffee in the international market.
Differentiated coffees, which include those of superior quality or certified for sustainable practices, accounted for 18.6% of total Brazilian coffee exports in the 2023/24 harvest year. The volume of these differentiated coffees reached 8.799 million bags, representing a 45.4% growth compared to the previous cycle. The average price for these coffees was US$ 229.15 per bag, generating foreign exchange revenue of US$ 2.016 billion, which is 28.4% higher than the previous year (Coffee Geography).
Key Export Destinations
In July 2024, Brazil primarily exported coffee to Germany (US$ 132 million), the United States (US$ 123 million), Belgium (US$ 75.5 million), Japan (US$ 56 million), and Italy (US$ 54.9 million). These countries have consistently been major importers of Brazilian coffee, reflecting strong and stable trade relationships.
The United States emerged as the leading importer of Brazilian differentiated coffees, with 1.852 million bags, accounting for 21.1% of the total exports of this type of coffee (Coffee Geography). This highlights the growing demand for high-quality and sustainably produced coffee in the U.S. market.
Market Dynamics and Competitive Position
In2023/24 Brazil’s Coffee Export business was bolstered by reduced supply from other major coffee-producing countries; Mainly Indonesia and Vietnam. This allowed Brazil to expand its market share in global trade, particularly with its national conilon and robusta varieties (Coffee Geography). The record foreign exchange revenue also reflects favorable conditions in the international market, which have supported the growth of Brazilian coffee exports.
Increased coffee exports were also driven by a better harvest after two smaller cycles, which improved the availability of coffee for export. This, combined with the high foreign exchange revenues, has provided some relief to exporters facing high costs and has enabled significant transfers of the Free on Board (FOB) value to producers, averaging 85% (Coffee Geography).
Future Projections
Expanding coffee consumption in emerging markets, premiumization, and rising demand for organic and fairly traded products are expected to drive the coffee market in Brazil to continue its upward trend. The market divides into roast coffee and instant coffee, with revenue and volume projections showing steady growth.
Data from Statista Market Insights suggest that the coffee market will benefit from both at-home and out-of-home consumption. With retail sales via supermarkets, eCommerce, and convenience stores playing a significant role.
For more insights on Brazil’s coffee industry, read our previous analysis on market trends.
Conclusion
In conclusion, Brazil’s coffee export trends and revenue in 2023/24 highlight the country’s robust position in the global coffee market. The significant increase in export volumes and foreign exchange revenue. Coupled with the growing demand for differentiated coffees, underscores the dynamic and competitive nature of Brazil’s coffee industry. The future outlook remains positive, with continued growth expected in both domestic and international markets.
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Climatic Conditions and Their Impact on Brazil’s 2024 Coffee Crop
Discover how climatic conditions are impacting Brazil’s 2024 coffee crop, leading to reduced yields and rising global coffee prices.
Climatic Conditions and Their Impact on Brazil’s 2024 Coffee Crop
Temperature Sensitivity and Its Effects on Brazil Coffee Crop 2024
Arabica coffee is highly sensitive to temperatures above 34°C, a threshold at which flowers are at risk of abortion, reducing potential crop yield. The extreme weather conditions from the end of August to late September 2023 have threatened the Arabica crop in Brazil, the world’s largest coffee producer. Hot and dry weather conditions that followed unseasonal rains in late August particularly impacted Brazil’s South of Minas region.
This region experienced significant flower bud abortion, which is expected to reduce the potential yield for the 2024/25 season. Above-average temperatures and low soil moisture levels caused by the drought are negatively affecting the cherry set and general tree conditions.
Drought Conditions and Rainfall Distribution in Brazil Coffee Farms
Brazil is currently facing its worst drought in more than seven decades, which has severely impacted coffee farms. According to ABC News, the drought has caused significant defoliation and hindered the development of coffee crops. The National Supply Company (CONAB) reduced its estimate for the 2024/25 season by 6.8%, to 54.79 million bags. Due to poorly distributed rainfall and high temperatures during the fruit development phases.
Regional Impacts on Brazil Coffee Crop 2024
South of Minas Gerais
The South of Minas Gerais, a key coffee-producing region, has been particularly affected by the adverse weather conditions. The region experienced significant flower bud abortion due to high temperatures and low rainfall. According to Mintec’s Tropical Research Services:
- The cumulative rains recorded in late September provided the necessary conditions for a second round of flowering, with an expected intensity between 20% and 30% of the productive potential of the 2024/25 season.
- The risk of high temperatures towards the end of September may have damaged the bud flowers that will produce the second round of flowering.
Espírito Santo and Paraná
In Espírito Santo, specifically in the São Mateus region, the situation is worsening. Despite most areas of the state being equipped for irrigation, the São Mateus region received only 20% of the expected rainfall during the critical period. The hydrological balance in the Southeast is similar to that recorded in 2020, which led to a crop failure in the 21/22 cycle. Forecast models indicate a continued reduction in the hydrological balance until the first week of January (Revista Cultivar).
Impact on Coffee Prices
The adverse climatic conditions in Brazil have started driving up global coffee prices. According to ABC News, the market is closely monitoring how Brazilian coffee plants endure these conditions, which can cause flowers to stop blooming, fail to turn into cherries, or produce lower-quality beans. The price of Arabica coffee in New York and Robusta coffee in Europe has already started trading at higher levels. In August, the International Coffee Organization’s Composite Indicator Price averaged $2.38 per pound, up nearly 55% from the same month a year ago. Higher demand, particularly in Asia, and adverse weather conditions affecting coffee production are driving the rising prices.
Future Projections and Concerns for Brazil Coffee Crop 2024
Looking forward to October, the cumulative rainfall forecast for the first 15 days appears promising, surpassing the minimum requirements for proper flower and cherry development. October is expected to bring at least 100 mm of rainfall, meeting or exceeding the minimum required for proper development. However, the ongoing drought and high temperatures continue to pose a significant threat to the 2024/25 harvest. The Center for Advanced Studies on Applied Economics at the University of Sao Paulo’s agribusiness school reported that the ongoing drought is already complicating the start of the 2025/2026 season (AP News).
In summary, the climatic conditions in Brazil have had a profound impact on the coffee crop for the 2024/25 season. The combination of high temperatures, drought, and poorly distributed rainfall has led to reduced yield estimates and increased global coffee prices. The situation remains precarious, with future weather patterns playing a crucial role in determining the final outcome of the harvest.
Conclusion
Brazil’s coffee production in 2024 is set to grow significantly, driven by favorable weather conditions and rising international demand. The projected 5.4% increase in total coffee production, reaching 58.08 million bags, highlights the resilience and potential of Brazil’s coffee industry. Key coffee-producing regions, including Minas Gerais, Espírito Santo, and São Paulo, are expected to see substantial yield increases.
However, the impact of adverse climatic conditions, including high temperatures and drought, poses a significant threat to the overall yield and quality of the coffee crop. Regarding exports, Brazil has demonstrated strong performance. Record-breaking volume of 47.3 million 60-kg bags exported in the 2023/24 marketing year, generating unprecedented revenue. As we look ahead, the market dynamics appear favorable, driven by the growing demand for differentiated and high-quality coffees. For stakeholders and investors, navigating these opportunities and challenges will be crucial for capitalizing on Brazil’s coffee market potential in 2024 and beyond.
References
- USDA Foreign Agriculture Service, 2024 https://dailycoffeenews.com/2024/06/10/brazil-coffee-report-upward-prediction-for-production-exports-and-revenue/
- Brazilian Farmers, 2024 https://brazilianfarmers.com/news/brazils-2024-coffee-harvest-is-expected-to-exceed-last-years-by-5-5/
- Mintec’s Tropical Research Services, 2024 https://www.mintecglobal.com/top-stories/outlook-for-brazil-2024/25-arabica-crop-hangs-in-the-balance
- ABC News, 2024 https://abcnews.go.com/Business/wireStory/brazil-drought-punishes-coffee-farms-threatens-push-prices-113864391
- Coffee Geography, 2024 https://coffeegeography.com/2024/07/13/brazils-coffee-export-hits-record-high-with-47-3-million-bags/
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