Continuous torrential rains in Colombia cause flooding global coffee supply shortages exacerbate price rises

Floods have occurred in many parts of Colombia

According to a report on Colombia released by the Rescue Network (ReliefWeb) on 8 September, a dam used as the retaining wall of the Cauca River overflowed that month after unusually heavy rains in parts of Ramohana, northern Bolivar, Sucre, Antioquia and Cordoba.

The floods affected all cities in the region, with Archie, San Jacinto-Delcoka and Guaranda the most affected. On 6 September, about 50,000 people were known to have been affected in Sucre and Cordoba. As a result of the destruction of houses, an unknown number of people in Ramojana have had to move to higher-lying areas, with an estimated need to relocate 300000 head of cattle, flooding at least 7,000 hectares of crops, and impairing the agricultural livelihoods on which many residents in the area depend. At least 500000 people in Ramoana are threatened by future floods.

According to a separate report released on September 22nd, several severe weather events, including heavy rain and strong winds, caused floods, flash floods and landslides in 70 cities in Colombia's 19 provinces from September 1 to 20, according to Colombia's National disaster risk Management (UNGRD).

At least four people were injured, 8134 families were affected and more than 6000 houses were damaged or destroyed. The worst affected provinces include Antioquia, Northern Santander, Bol í var, Cauca, Tolima, Cordoba and Meta.

Red alerts for landslides and thunderstorms have been issued in northern, central and mid-western Colombia.

The prospect of coffee production in Colombia is worrying

According to Bloomberg on Sept. 25, the outlook for coffee production in Colombia has deteriorated due to a wide range of strong and high rainfall.

Maxar Technologies Inc, a geospatial intelligence company. In a telephone interview with Bloomberg, a senior meteorologist said that the weather in the main crop-growing areas is so humid that rainfall has far exceeded their need for water, and in the next 10 days or weeks, rainfall will bring more water to these areas.

Colombia's current woes are likely to exacerbate the shortage of global coffee stocks in the next quarter. The inventory crunch caused by the collapse in Brazilian coffee production has been complicated by soaring costs and headwinds in shipping. These factors have led to the expected increase in the cost of coffee brands, and the increased costs may be added to the end consumers.

Brazil's production this year is down about 18 million bags from the same period last year, accounting for about 40 per cent of the country's Arabica production. This decline exceeds Colombia's annual production of about 14 million bags (60 kg / bag). Brazil and Colombia alone account for about 2/3 of the world's Arabica coffee supply. New York futures prices have soared more than 50% so far this year.

Buyers are more worried about the default of Cannon.

Tight supply and tighter supply have also heightened fears of default by Colombian Canon, who may fail to honor contracts signed when prices are low.

Earlier this year, the Colombian Federation of Coffee growers called on farmers to avoid default because of protests that led to port delays and complaints from buyers.

The situation in South America further complicates the industry, which has been challenged by soaring fertilizer and energy costs, shipping disruptions and epidemic restrictions in places such as Vietnam, and the market is facing growing supply shortages.

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