Top coffee producer, Brazil recorded the lowest monthly exports in almost two years, showing concerns that global demand may decline as economies are shaken from the COVID-19 pandemic.
According to data from export group CeCafe, green-coffee shipments in May fell to 2.68 million bags, down 23% from a year earlier, to the lowest since July 2018. While the drop in shipments reflects lower output last year, when crops entered the lower-yielding half of two years, it may also reflect trader caution over demand. Arabica coffee for September delivery already fell by 1.3%.
Carlos Alberto Fernandes Santana, director at Empresa Interagricola SA, a unit of Ecom Agroindustrial Corp, stated that global coffee demand has been smaller, and coffee shipments in June are expected to confirm the drop.
According to the International Coffee Association (ICO), with worldwide negative growth forecasts for 2020, an impending global recession could impact overall coffee consumption and demand.
The fastest-growing coffee market is the market in Asia. This is due to a rise in the demand for coffee by the working population, the growing presence of a large number of coffee shops, and the growing retail e-commerce sector. The U.S. coffee market represents one of the largest markets and is already well-penetrated at developed market levels.