It is the New Year in the Gregorian Calendar, the past 12 months have been interesting, I am sure we all agree! But we do not want to go over the problems of the past, let’s take a look at our first impressions of the New Crop. Coffee is just about starting to mature in the lower coffee growing areas. Things are looking peachy! We are looking to a better crop both in terms of quality and quantity, truth be told this current crop is pretty disappointing on both counts; our initial projections are for a better crop in 20/21. Particularly in the Southern coffee growing regions, Sidamo, Yirgacheffe and Guji we are expecting a marked increase in production this coming season. Some of the people we have had conversations with in the last few days are expecting the best output in the South in the last 3 years, a relief to many stakeholders that have viewed the decline in volumes from these areas with concern.
On the other hand news about current crop output is much less encouraging. ECX warehouse stocks are at very low levels, seemingly the lowest ever and exporters continue to worry about their commitments. Once again the prospect of further defaults and postponements lingers…
Covid continues to be of concern, a further 100 deaths this week and around 10,000 positive tests.
Internal prices remain very high, internal consumption and the lack of coffee for this segment of the market is the main driver of prices. Export offer prices have tightened along with differentials, so export business has not been as brisk this week.
Forex: 36.46 Birr to the USD.
Have a good weekend.