Agricultural Update: Smooth Progress in Brazil's Coffee Harvest Amid Global Supply Dynamics

Agriculture – Brazil coffee harvest progressing smoothly

Cooxupe, Brazil's coffee export cooperative, reported that the domestic coffee harvest is progressing well with 92% of the crop harvested as of 25 August compared to around 87% a week ago and around 91% at this point last season. Brazil has also reported good weather in recent weeks with the Minas Gerais region receiving more than normal rains, which should help the flowering process for new crops. However, coffee supplies from Vietnam remain tight as dry weather impacts the crop.  The ongoing El-Nino weather pattern is usually associated with good rains in South America but dry weather in Asia that could tighten supplies of the Robusta variety. This also supports a narrowing of the Arabica-Robusta spread,  which has dropped to an average of US¢36/lb in August compared to recent highs of around US¢100/lb in February.