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Colombian coffee prices reached $ 2.11 per pound

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The international price of grain rose to $ 2.11 yesterday May 12. The guild domestic price change scheme. This price was reported by the International Coffee Organization (ICO) and, paradoxically concern to the national coffee institutions.
According to the OIC, the reference price for May 12, which was released today is 211.32 cents per pound of Arabica Colombian soft. But in New York, the price even already reached 226.25 cents per pound.
The reference price is an average between the market of New York and Germany. In this country, the pound reached 199.58 cents. These prices are the highest since 1997.
The concern of the OIC and exporters it surveyed is that the Colombian coffee is rising simply because there is sufficient supply after the winter of last year.
As prices rise, to account for the commitments would be met with lower-quality coffee while beverage producers would replace the Colombian blended coffees by others.
The Government and the National Federation of Coffee Growers now define a strategy to try to maximize the recorded high grain prices in the international market, despite the low production reported by the country.
The Finance Minister Oscar Ivan Zuluaga, anticipated that there will be measures to ensure that growers can benefit 500,000 families of growing momentum in prices. Therefore, he said, will announce the implementation of a new system of valuation and determination of domestic price of grain. This is a scheme approved by the National Coffee Committee which promotes the grain quality and aims to improve farmers' income.
The exceptional moment prices has become something of a paradox for the sector, since there is not enough coffee to sell.
Jorge Lozano, president of the Association of Coffee Exporters Private, Asoexport, said "there is distress in the guild" because you do not have enough product to meet the offices.
"The farmer has to be happy because you are compensating for the lack of production with a very good price. Unfortunately not much to sell and that is our trouble, "admitted the leader. He said that despite the good prices the prospect of a boom not seen anywhere, simply because there is no grain available. "It's a very unpleasant situation for the toaster. He has the need to purchase Colombian coffee and high prices do not like even five. And going to search that does not happen again, "he said. "We have a client who is looking for alternatives. That's not good for the Colombian coffee, "the President of Asoexport.
Lower production
Lozano said it is anticipated that between July 2008 and June next, coffee production to fall 2.5 million bags compared to previous period. This is a "very important figure," he said, facing a production of 11.5 million bags estimated for the entire year.
The leader revealed even though not yet have the production figures given last April, "the decline was substantial because the records of coffee for export stood at about 450,000 bags, 200,000 less than normal."
According to the National Federation of Coffee, Colombian production fell 30% the first two months of 2009 compared to same period last year, while exports declined by 20%.
According to the report, the fall was due to "lower production of grain, fruit of the renovation of coffee plantations, the effects of reduced fertilization and winter of the last months of 2008."
Meanwhile, the escalating price of coffee is attributed by economic analysts to a phenomenon of market speculation. Indeed, investors fear that this year there will be a substantial reduction in the supply of major producing countries like Brazil, and have begun to bet on higher prices in the future, so that the price began to climb. In Brazil, the production will fall about six million bags this year, according to estimates by the Government of that country.

Deficit is predicted coffee in the world

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Global consumption of coffee should not suffer substantially because of the crisis in the global economy, it could have some impact in certain special ranges of coffee, said Wednesday April 8 executive director of the International Coffee Organization, ICO, Nestor Osorio.
In contrast, in markets where coffee consumption is not sufficiently rooted habit, as in emerging countries, it could be experienced "some reduction" in demand, he admitted.
Osorio said the analysis points out that demand, whose growth rate is 2.5% a year will maintain its current momentum and trend.
"Every year we consume extra two million bags of coffee and we are approaching 130 million bags annually worldwide," he said at a meeting organized by commodity United Nations Conference on Trade and Development, UNCTAD, in Geneva.
The head of the ICO announced that this year there will be a shortfall in production due to the characteristic two-year cycle of Brazilian coffee, which crops are immediately followed by high production rates.
He noted that the global deficit could be around 10%, which will add a unique situation: the producers do not have sufficient reserves.
To illustrate the importance of this factor, Osorio reported that "30 years ago Brazil had reserves equivalent to 25% of the world, but now has nothing, and the same goes in other producing countries."
"In conclusion, global production of 125 million bags of coffee, a consumption of 130 million and only $ 20 million in stocks of importers implies that equilibrium between supply and demand is very weak," he said.
Under these conditions, "any incident, such as frost in Brazil or a severe drought here or there could strangle the market and coffee prices skyrocket."
Speaking at the meeting of the UNCTAD, Osorio said that another "challenge" that activity is likely to face coffee have to do with the choice between "food or energy."
That is, the use of land to grow crops for biofuels .
"Here I see a difficult situation in terms of sustainability for products such as coffee or cocoa," he said, to explain right away that there is "the possibility that areas where coffee is grown now be replaced with crops ranging for food or energy ".
This is a "real threat" involving mainly Brazil and Africa, where coffee is grown on flat surfaces and can be a little less profitable.
Brazil is currently the world's largest producer of coffee, accounting for 36 percent of the market and Colombia has 8 percent, while the rest of Latin America has a market share of 19 percent.
On the consumption side, Europe accounts for 38 percent, North America by 22 and Central and South America by 23 percent.
The global value of coffee exports was 15,200 million dollars in 2008, while the value of this market, that is if you add that cost him all the cups of coffee drink in a year, is 90,000 million.

Future purchases

# Following the record high prices in New York Coffee, President Alvaro Uribe proposed to promote future purchases of grain, especially in October.
# Such a scheme, he noted, would allow producers to better recovery, and therefore an advantage of the high prices in favor of economic recovery.

International coffee prices continue to skyrocket: the grain reached $ 1.50 a pound

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Precio del café 2008
But while the value of the product reaches unexpected levels, the dollar continues to fall, which has increased the appreciation of the peso.
The record price recorded by the International Coffee Organization (ICO), not seen for a decade (May 1998).
In the domestic market prices also rebounded this year, as the load of 125 kilos, as the price for receiving the coffee farmers' cooperatives in the holds of Almacafé, these days has been at 500,000 pesos, but now in a minimum of 521. 500 pesos (in Cucuta) and 525 250 (Santa Marta).
Producers such as Mario Gomez Estrada, Caldas representative on the National Committee of Coffee Growers, think that the international price is not a panacea, as in Colombia, production costs have been increasing in labor and inputs (fertilizers).
Despite the surge in grain prices, farmers will not benefit the full extent because the prices at this time there is no harvest, for the next harvest season is scheduled for the months of April and May, when the production comes the so-called crop of MiTAC. During this period, the highest production was recorded in the departments of Tolima, Huila and Cundinamarca Santanders. This means that the traditional coffee-growing region, consisting of Quindio, Risaralda and Caldas, will not qualify for current prices as most grain production in this region are noted in the second half, during October and November. However, the good behavior during the past months can contribute to the harvest of MiTAC in the coffee is higher than previous years.
The minibonanza comes as the country has decreased considerably the cultivated area of ​​coffee, as a result of the crisis that has lived since the early 90's and the conversion of farms to touristy activities.
Good prices were predicted
Although the current situation of international prices had been predicted by experts, the current price of $ 1.50 per pound was not in the plans of those who sell the grain in the New York Stock Exchange. So far, the projections indicated that prices would keep over a pound, but at no time spoke of the figure recorded yesterday. The increase in contributions due, according to market analysts, the increased demand and reduced inventories.