“Nightmare” Of Factors Pushing World Into Coffee Deficit


A coffee shortage appears to be brewing as global supplies could shift into a deficit as drought in Brazil slashes output. This has resulted in surging wholesale prices and US supplies slumping to a six-year low. Savor today’s cheap cup of joe because retail prices are set to rise.

Besides the creeping deficit set to materialize this year, coffee importers in the US have also dealt with a global shortage of shipping containers. Christian Wolthers, the president of Wolthers Douque, an importer in Fort Lauderdale, Florida, told Bloomberg this has resulted in a logistical nightmare.

He estimates his shipping costs from South America have doubled, adding that “these bottlenecks are turning into a container nightmare.”

So maybe a perfect storm of factors from adverse weather conditions in South America to further fallout from a global shortage of shipping containers have pushed up Arabica-coffee futures in New York by nearly a quarter since late October.

Last month, unroasted US bean inventory declined by 8.3% from a year earlier to the smallest inventory levels since 2015. – READ MORE

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