Marcelo Teixeira
Houston (Reuters) – Global coffee and baking traders say they have reduced their shopping to minimal levels, as the industry bakes from steep increase in prices that suppliers have yet to convince retail stores to accept.
At the annual Convention of the American National Coffee Coffee Association in Houston, participants said they were in a shock with an increase of 70% of November for Arabica Futures Futures on Ice Exchange, reference coffee for coffee around the world.
Renan Chueiri, CEO of Elcafe Ca in Ecuador, said this year was the first time that the instant coffee manufacturer had not sold all the expected annual production until March.
“We would usually be sold out so far, but so far we have sold less than 30% of production,” he said. “A high price increase eats clients’ cash flow, they don’t have all the money to buy what they need.”
Increasing the price of coffee stems from lower production in important coffee breeding regions, especially in top -notch Brazil, reducing the availability of beans.
“No one wants to be exposed, no one buys for future delivery, it’s all a hand on his mouth,” said one intermediary of coffee, asking not to identify himself because of the sensitivity of the problem.
“Hand to his mouth,” he thought of buying only what is necessary for now and avoiding supplies.
Many recent contracts in Brazil, he said, were made in a very conservative way.
“Close the job and then you have seven days to go to the farm or warehouse and drink coffee. Check the quality, and if it’s okay, you pay on the site and drive with coffee.”
Recent Reuters survey predicted that Arabica coffee prices would drop 30%by the end of the year, as high prices suppress demand and early signs indicate the Brazilian crop of bumpers next year.
But until the prices do not fall significantly, much of the coffee industry could be for the world of pain.
Executive director of large baking in the United States – the world’s largest coffee consumption market, said some of his clients are not sure they can continue to do business.
“They do not know if they will be able to sell their product at new prices,” he said, also asking that they were not identified. “Some people go down.”
Executive director said supermarkets and food stores pushed the higher prices sought by Roasters. Negotiations lasted a long time, and some retail places started having coffee on the shelves.
