Harvest Situation in Brazil

Finally the weather pattern returned to the normal dry conditions for the season, the whole Brazilian coffee Belt is under clear skies and very low humidity for at least 2 consecutive weeks now.

Another 25% of the harvest has been collected since my last report back in July 29th. Now, approximately 70 – 75% of the harvest is done. The Cerrado of Minas Gerais is at full blast and will be the last area to finish the harvest activities, probably by the end of September.

The quality of the first lots for export approval is showing a very high level of rejections as the cup quality and grade have strong influence of rain damage. On the other hand, the better lots will soon be entering the scenario as these come out of the resting binds after the recent period of ideal weather and harvest procedures.

It will probably be very wise to recommend your shippers/suppliers to only ship new crop coffees from October onwards, by then, the new crop taste has less of an impact and the selection process identifying the best quality has already happened.

While Brazil seems to have left the recession building, other good news support the local coffee sector, the winter has been quite cold. This has helped to keep the internal consumption above the 5% growth rate for the year. Roasters in Brazil are supporting the market and bringing enough cash flow to producer communities and cooperatives.

On another note, a local Brazilian business newspaper issued an article last week about Colombia’s FNC plans to install various Juan Valdez coffee shops in the major cities of Brazil. If the FNC’s plans become a reality, local consumers will be exposed to yet another great option of coffee within so many other brands already in the country.

Today, major global Specialty and Premium coffee brands share market space in the very rich and expanding Brazilian internal market. Illy, Nespresso, Dunkin Donuts, Starbucks, Mc Café, Sara Lee/Café do Ponto and Segafredo are only some of the top foreign players with stores and/or distribution in Brazil, hundreds of local brands also compete by catering and/or advertising directly to consumers.

While in the recent past, Brazilian finished roasted product made strong attempts to compete in European and in North American supermarket shelves, now it’s the American, European and even other producing countries that are competing for the Brazilian consumer, what an unexpected turn!

In other words, my message today is: build and strengthen ties and relations with your actual and potential Brazilian green coffee suppliers, demand for this product is only growing. aLSO, In case the FNC really opens Juan Valdez stores in Brazil, be extra CLOSE with those suppliers as well.
Have a great Back to school week,

Christian Wolthers
Wolthers America

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