Brazilian Government set to help secure coffee prices with record yields expected
Coffee bean farmers in Brazil are urging the Government to increase its purchase of the product in order to reinforce prices as this year’s output looks set to reach record heights.
Brazil is currently the world’s largest coffee bean producer. The nation’s coffee growers are hoping to persuade the Government to buy 5million sacks of coffee this market year, up 2 million sacks on last year’s acquisitions.
Such a move would help to stabilise prices in the country by taking the coffee beans off the global market. Rosemeire Santos, a director of the National Agriculture Confederation, a lobbying group in the country, predicts that Government procurement would help boost domestic coffee prices by up to a quarter. In a recent interview Santos said that “Brazil needs to be prepared for a large crop and keep supplies in check to avert price drops”.
Current estimates predict that output in Brazil will reach between 45 and 50 million 60 kg sacks this year, which is a substantial increase from the 39.5 million harvested last year.
The Agriculture Ministry has already begun talks with domestic farmers and Santos expects that the purchases will be sanctioned by the National Monetary Council next month.
The terms of the deal would see farmers offered fixed prices at which to sell their produce directly to the Government if higher prices cannot be found on the open market. Auctions will be held between August and November this year according to the group’s proposal to the Government.