Temperatures dropped in Brazil this week and regions including Sul de Minas, Cerrado and Mogiana all received some frost. The impact is not yet fully known.
What we do know is that the damage seems to be worse than originally predicted. The farther that experts travel to assess the situation, the more the problem seems to grow. Though certainly, some areas were affected worse than others. Further investigation is required before we land on an accurate number, and our colleagues and other experts are aggressively investigating. The current marketplace talk is putting potential damage at between 1 million and 3 million bags, with some exceptions suggesting higher.
Further compounding the situation, there are forecasts of another cold front moving its way up and expected to reach Brazil’s coffee belt around July 29 and 30.
The coffee market opened today 12 cents higher, trading 188 out of the gate. It closed at 193.65.
Realistically, until more certain numbers emerge regarding current damage, and until the next cold front passes, there is little reason for the market to correct itself.
Other origins are very quiet. Only Colombia looks to be actively offering (September onward).
We likely have some very long days, if not weeks ahead, which we understand is enormously stressful. Please don’t hesitate to reach out with questions. Please use your trader as a resource. We’re here for you and happy to assist: traders.iacus@nkg.coffee.
And of course, as soon as we have more-certain news, we’ll be sure to share it.
