Soaring prices triggered business in the Brazilian physical market, and the percentile committed by growers took another leap. This has been a commercial feature of this season, with intense negotiations followed by quiet movements. It was already like that during the rebound with cold in July and now again with the change of level on ICE and dollar firmness. The timing remains very favorable to sellers. A few months ago growers could not even dream that they would sell good cup coffees between BRL 535 and 550 a bag depending on defects.
SAFRAS survey indicates that until December 10 the commitment of the 19/20 season by growers was at 71% of production. Sales flow is much faster compared to the same period last year, when sales reached 64% of the crop, as well as above the 5-year average for the period (68%).
Highlight on arabica, with commercialization reaching 71% of the crop. Sales of these coffees are well above the same time last year (61%) and also higher than the average for the period (66%). Conillon sales also improved and reached 72% of the crop, slightly below the same period last year (73%), but in line with the 5-year average for the period (72%).
The sequence of highs improves the outlook for January and February, which has made growers hold back supply, especially of the best cups. Usually tax issues already make sellers slow down a bit, which reinforces this perception of a shorter available supply. Sales of the new crop have also jumped, driven by significant improvement in prices. The best cups were negotiated around BRL 570 to 590 in the case of good and fine coffees for Sep/20.