Recap #17 | September 10, 2020

 
 

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In Episode #15, we covered the rise of the C market price for coffee, largely attributed to the shifting relationship between the US dollar and the Brazilian real. An increase in price was further bolstered across August by concerns over low levels of coffee outputs and exports. But supplies may not be tight for long: Brazil has managed a bumper crop this year despite difficult weather and COVID-19 restrictions. Combined with a weak currency, this has made Brazilian coffee more competitive than washed Arabica from Central America. Bloomberg reports that major traders are preparing to ship Brazilian coffee to warehouses for approval to replenish dwindling coffee stockpiles, at their lowest level since 2000. On Tuesday, September 7, Reuters reported that 855 60 kg bags of Brazilian Arabica were accepted by exchange warehouses in Antwerp, more than doubling the amount of Brazilian coffee in the warehouse in one day. Accepted deliveries of Brazilian coffee to the exchange are rare: Arabica futures are backed by washed coffees, while Brazil produces mostly natural and pulped natural, or “semi-washed,” coffees. However, this season’s record crop is of high quality and expected to contain a fair amount of semi-washed coffees, which are more likely to be certified as deliverable. If further shipments are accepted as meeting the requirements of the commodity market, the increase in warehouse supply could destabilize the steady growth of the C market price over the past two months. 

Qima Coffee, a Yemeni coffee specialist, announced it has discovered a new genetic group of Arabica. In partnership with coffee geneticist Christophe Montagnon, Qima Coffee undertook a multi-year research project that conducted genetic fingerprinting of over 130 Arabica samples across 25,000 sq. km. The new genetic group has been named Yemenia, which can be translated to “the Yemeni mother,” and has been touted as the most significant finding in Arabica coffee since the centuries-old discoveries of the other major Arabica groups Typica, Bourbon, and the SLs. The results of the research project have been submitted for publication to the Genetic Resources and Crop Evolution Journal. Qima Coffee will partner with the Alliance of Coffee Excellence to host a public auction focused entirely on Qima’s coffees, with 15 of the 20 lots on offer made up of the newly discovered, high-scoring Yemenia genetic group. 

The International Coffee Organization, Inter African Coffee Organization, and the Center for Agriculture and Biosciences International have proposed a plan to alleviate the impacts of the COVID-19 pandemic on the African coffee sector. The US$14 million dollar plan is designed to improve food security for smallholders suffering from a prolonged period of low coffee prices exacerbated by the effects of the pandemic on infrastructure and markets. Scheduled to take place over three years and across 11 countries, the plan seeks to both boost coffee exports and encourage the addition of other crops for cash and consumption. Supported by the African Union Commission, the proposal has now been submitted to the European Commission for consideration. 

Flash Coffee, an Indonesian coffee chain that recently made the jump to Thailand, appears to be thriving despite the difficult operating conditions of the pandemic. Seeking to blend a specialty coffee menu with affordable prices and tech, Flash Coffee worked with Thai World Latte Art Champion Arnon Thitiprasert, to build their offering. The company’s Managing Director, Pan Leenutaphong, remarked, “if anything, COVID-19 has facilitated our launches, and landlords have been more welcoming to our new concept.” Flash Coffee Thailand launched their first store in May of this year with funding from Rocket International, a Berlin tech incubator. The company plans to use technology to enhance operational performance and to facilitate other core parts of its business. 

This episode of Recap was made possible with the support of DaVinci. If you want to dive deeper into anything you heard today, check out the links in the description of this episode. Recap will be back in two weeks’ time. Thanks for listening.

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