Severe frosts in Brazil cause coffee anxiety

Intense frost swept Brazil in July, concentrating in regions and states that produce significant volumes of coffee. The most heavily impacted regions were the states of São Paulo and Minas Gerais which are the two largest coffee-producing states in Brazil.

According to reports by the Brazilian government’s agriculture department, some 70% of all Brazilian coffee has already been harvested for the 2021/22 crop year. Reports of estimated production losses are rising. At present, reasonable estimates claim that anywhere from 2.5 to 5.5 million bags have been lost. However the true figure could be as high as 10 million.

As the frost was severe, coffee trees will take time to recover. In some cases, it will take three to four years. Brazil is the world’s largest coffee producer, producing 40% of the worlds Arabica coffee. As a consequence Brazilian coffee production significantly affects prices for the global market. Coffee prices are currently trading at a record high and the rest of the supply chain will soon feel the knock-on effects. Some Brazilian co-operatives may go under, and for roasters, prices will go up.