Coffee Market Commentary - April 17th, 2025

As an industry, we try and emphasize a focus on transparency. Regulations such as the European Union Deforestation Regulation (EUDR), certification programs and “relationship coffee” aim to ensure a sustainable supply chain. But there is another side to transparency that the coffee sector is severely lacking: transparency in data.

As with any commodity market, the direction of the C market is most impacted by the global balance sheet. The supply and demand factors and the subsequent result of either a supply surplus or deficit will determine whether the scenario is bullish or bearish for coffee prices on the international market. So, data regarding the balance sheet is one of the key indicators needed for accurate assessments. But is our data credible? Is it accurate? Or are the fundamental factors of the coffee market determined by “guesstimates?”

Let’s take production. As we all know, Brazil is the leader in coffee production. For Arabica currently, and recently, there is expectation that Brazil will eventually surpass Vietnam as the number one producer of Robusta coffee as well. Therefore, Brazil’s coffee production is one of the most important factors in determining global supply. Around the same time every year, the market becomes flooded with various crop estimates from private firms and government agencies. Some have a “boots on the ground” process while others are just conducting phone surveys. The methods are as varied as the forecasts themselves- which, most of the time, have differences of upwards of 10 million bags! With discrepancies so large, can we comfortably say that our production variable of the balance sheet formula is transparent?

And what about consumption? Global coffee demand is even harder to calculate than production. Fortunately, we have government-regulated data on imports from most of the major consuming regions of the world. We can certainly use this as a starting point. But inventories are also key in determining usage. In 2023, the Green Coffee Association (GCA) discontinued their monthly reporting on green coffee stocks in the United States, leaving us completely lacking one huge piece of the demand puzzle. Green coffee stocks in the European Union are still reported by the European Coffee Federation (ECF) but only include data from Antwerp, Hamburg, Le Havre, Barcelona, Trieste, Genoa, Napoli, Tallin, London, Felixstowe, and Bremen (partly), leaving out some of the other main ports for coffee in the EU.

Uncertainties surrounding production, lack of data for stocks, ambiguity for demand- are we really the transparent industry that we pride ourselves on being? Could we be doing more in terms of unified reporting of crops and consistent data? Having industry-wide, well-accepted figures could reduce both market manipulation and volatility at a time when we can all use a little predictability.

Considering these challenges, what solutions do you envision to enhance transparency and data accessibility at the macro scale required for such a large and diverse market?