Coffee price increases continued in June, world production may fall short of demand in 2022: ICO

July 9, 2021

In June 2021, coffee prices recorded their eighth consecutive month of increase, triggered by the expectations of reduced supply from some origins in addition to disruptions in trade flows, according to the latest report from the International Coffee Organization.

The monthly average of the ICO composite indicator reached $1.41/lb. in June, representing an increase of 33.2% from the level of $1.06/lb. recorded October 2020. This is also the highest monthly average since the level of $1.46/lb. registered in November 2016.

Prices of all four groups of coffee – Colombian mild arabicas, other mild arabicas, Brazilian and other natural arabicas and robustas – have recorded a substantial increase. Increased activities of noncommercial speculative sector were also recorded in June 2021, as growing net long positions supported price trends upward.

In terms of market fundamentals, shipments by all exporting countries to all destinations totaled 9.8 million 60kg. bags in May 2021, a drop of 10.1%, compared with 10.9 million bags in May 2020. The level of total exports in May 2021 represented a 21.5% reduction of the volume recorded in May 2019, before the pandemic.

The ICO said limited availability of containers for shipments continues to be a major constraint to trade flows. However, total exports over the first eight months of coffee year 2020/21 increased to 87.3 million bags from 85.4 million bags during the same period in 2019/20.


Cumulative exports from June 2020 to May 2021 are estimated at 129.2 million bags, a relatively stable level, compared with the 129.4 million bags recorded from June 2019 to May 2020.

World consumption for coffee it the 2020/21 period is projected at 167.23 million bags, an increase of 1.9% over 164.01 million bags in the 2019/20 coffee year.

Total production for coffee year 2020/21 is estimated at 169.50 million bags, representing a 0.3% increase on 168.94 million bags in the 2019/20 period.

Although world consumption is increasing, the ICO noted, it remains 1.4% below world production. Moreover, in the coffee year 2021/22, the supply-demand ratio is expected to reverse as world production will barely meet world demand.