The market is still attentive to production in Brazil, the world’s largest producer, which is facing a drought and affecting the production of gold grain.
The quoted price of coffee on the stock exchanges exceeded $256 on Wednesday, its best record since 2011, in a market concerned about the drought affecting coffee areas in Brazil, the world’s largest producer.
The golden grain is quoted through Contract C, a reference instrument for 19 countries producing soft Arabica coffee, but which is subject to the swing of the market where aspects of demand or production influence. At the close of the day on August 28, the coffee reached $256.95, but in the session it reached a maximum of $259.4.
This is the best price seen in the quotation since August 2011. At that point he even exceeded the $280. In a note, the Salvadoran Coffee Institute (ISC) explained that prices were driven by a drought that threatens Brazil’s production of the 2024-2025 cycle. “However, the weakness of the Brazilian real has strengthened the country’s exports, making its products more competitive in the international market,” he adds in his report.
The Central Reserve Bank (BCR) reports that coffee exports left producers incomes of $96.2 million between January and July 2024, a figure that was $24.2 million lower, 20.1%, compared to the same period of 2023. The golden grain is the seventh largest export product of the Salvadoran basket, with a share of 2.95 %. In addition, it is the second most-selling agricultural product to the international market, only surpassed by sugar.