The cost of coffee on the New York Stock Exchange rose again and stood at USD2.83 per pound: its highest value in 13 years. For its part, the domestic price in Colombia reaches $2,509,000 per shipment and is the highest since a little over two years ago, when the highest cost in history was recorded.
The constant change in coffee prices outside now has a positive effect on farmers and the chain in Colombia; it is a temporary ‘bonanza’ that may end in a few months.
Yesterday the cost of external grains continued to rise and today they reached USD 2.83 per pound on the New York Stock Exchange, touching records not seen more than 13 years ago, which directly affects the internal cost in Colombia.
Our country is a price taker. In particular, the national value of coffee is the result of three international variables: Price on the NY Stock Exchange, which is ‘through the roof’; exchange rate, which has increased in the last few weeks and stands at more than $4,400; and the difference of Colombian coffee that is paid for its quality.
This is how it went for today and until Monday the average internal cost up to the highest level in the last two years, reaching: $2,509,000 per shipment of 125 Kg of parchment, especially in Neiva it is purchased on average for $2,507,750.
The internal cost is going to touch the historical high recorded on August 24, 2022 when the coffee shipment was bought for $2,530,000, according to official statistics.
“Colombia is coffee! We celebrate the international price that coffee has reached, reminding the world that coffee farming is not sustainable if the coffee grower is not profitable; the price along with good productivity levels is our focus as producers,” pointed out the manager of the National Federation of Coffee Growers – FNC, Germán Bahamón.
He also said “From the Federation we continue with our work to protect income and transfer the highest price to the producer, that is what has been one of the principles our foundation as a society. “We work hard for the success of coffee growers.”
The effects
The union explained that this behavior is due to its possible impact on coffee production in Vietnam and Brazil, affecting global supply and favoring the price of coffee in the three days after a each other
He indicated through an official statement that the possible reduction in the harvest is due to the climate effect in Brazil and Vietnam (the first and second producers in the world), causing the supply and demand relationship favors the coffee sector and, as a result. , in Colombia, the third largest producer of coffee in the world.
He confirmed that the increase in the exchange rate also helps the cargo price of coffee in Colombia to skyrocket.
Colombia is going through a period in which coffee growers have a lot of coffee, because this is their main harvest. Regions like Huila, the largest producer in the country, harvest the largest harvest of the year.
Last October, the value of the harvest stood at 1.7 billion pesos, which represented an increase of 82.4% compared to October 2023, when it reached 955 billion pesos. This is the sixth consecutive month with positive double-digit changes in this variable. In its accumulated 12 months, the value of the harvest reached 12.8 billion pesos, a level 10.9% higher than the level seen in the same period of 2023.
So far this year and with the tenth month cut off, there has been an 18% increase in production, thanks to the better weather, surpassing the output seen in 2021, from after two years (2022 and 2023) closed for less than 12 million. 60 kg bags.
The projection is that calendar year 2024 will end with production above 13 million bags and will grow for the second year in a row.
For their part, farmers also maintain that just as the value of grain is rising, the price of inputs is rising like foam. In addition to the above there are divisions.
Source: Financial Management / Directorate of Economic Research – FNC.
