Recently, the International Coffee Organization (ICO) released its May monthly report on the global coffee market, showing that the composite indicator price averaged 208.38 cents per pound, a slight decrease of 3.9% compared to the previous month.

But by early May, rainfall began in Vietnam, alleviating farmers’ concerns about widespread drought. In addition, Brazil reported relatively dry local weather with limited rainfall, which allowed coffee harvesting to proceed smoothly, so benchmark prices started to decline.

But by mid-May, benchmark prices began to rise again, due to supply uncertainties for coffee crops in the two major coffee-producing countries, Brazil and Vietnam, as well as in Central America, where weather was dry and temperatures were above average. Another factor was the continued depreciation of Brazil’s currency, the real, in May, which put ongoing downward pressure on coffee prices.

In South America, exports grew by 44.5% to 5.15 million bags, mainly driven by strong growth in Brazil, which exported 4.24 million bags—up 54.8% from the same period last year, marking the highest export volume recorded in April.

But at the same time, due to reduced production in both Vietnam and Indonesia, coffee exports from Asia and Oceania decreased by 0.3% compared to the same period last year, to 3.78 million bags.

In addition, exports also decreased in Mexico and Central America, falling by 12.6% to 1.66 million bags, mainly due to a sharp decline in exports from Guatemala, Honduras, and Nicaragua in April, which dropped by 12.6%, 26.3%, and 22.9% respectively. The main reasons were that Guatemala and Honduras are currently in their low production season, and adverse weather conditions have led to reduced yields.

Although export volumes in Asia and the Pacific region have declined, Robusta bag exports increased by 13.4%. Production declines in Vietnam and Indonesia, coupled with pressure on Eurasian shipping routes due to the Red Sea crisis, have led to a surge in global demand for Brazilian Robusta. In April 2023, Brazil exported only 120,000 bags of Robusta, but this April the figure surged by 448.6% to 680,000 bags.

In the 2022/23 season, due to the impact of the COVID-19 pandemic, rising living costs and declining disposable income led to a 2% decrease in global coffee demand to 173.1 million bags. However, there are now signs of recovery, with global coffee consumption beginning to rise. It is projected that global coffee demand will grow by 2.2% in the 2023/24 season to reach 177 million bags.