Annual coffee production in Colombia increased by 21%!

Recently, according to data from the Colombian Coffee Growers Union (FNC), coffee production in Colombia in November totaled 1.76 million bags (60 kg / bag), an increase of 37% over the same period last year.

In addition, the head of the FNC said that this is mainly due to the recovery of weather and the replacement of more disease-resistant varieties in previous years. A total of 90, 000 hectares of coffee farmland have been renovated this year, the best record in the past 11 years. As a result, Colombian coffee production has reached 12.41 million bags in the past 12 months (December to November), an increase of 21% over the same period last year. And, due to the increase in production and exports, the coffee harvest was worth US $14.2 billion, an increase of 26%, and so far reached 108% growth in the fourth quarter.

It is understood that Colombia has encountered many situations in the past three years, coffee production has not been ideal, in 2023, affected by La Nina and El Ni ñ o, coffee production continues to decline, and planting costs are also increasing.

Between August and September this year, Colombia suffered from drought and forest fire problems. Fortunately, rain began to resume in October, and after that, the weather conditions were relatively stable, and coffee production and exports increased. In addition, as global coffee prices rise, so does the income of Colombian coffee growers, with more money to invest in and renovate coffee farms.

In addition, the country has recently strongly funded its agricultural development, and the Bank of Colombia earlier announced an investment of 22 billion pesos to support agricultural development and help farmers cope with extreme weather conditions. FNC has also partnered with Starbucks to distribute 55.7 million seedlings of coffee varieties resistant to rust and berry diseases to local farmers to help Colombia renovate coffee plots and increase long-term productivity.

But now Colombian traders are starting to worry because Colombia is likely to face stricter trade policies with the United States after the new US President Donald Trump takes office in January, and tariff measures may make exports more expensive. The United States is the main destination for Colombian exports, accounting for 29.2% of Colombia's total export sales, mainly importing commodities such as fuel, gold, flowers and coffee.

According to the Colombian service logistics manager, if protectionist measures and tariff adjustments are implemented in trade between the two countries, sales of Colombian goods to the United States could fall by 15% by 2025. It will also increase the cost of commodity exports and their market competitiveness, particularly affecting the agricultural and manufacturing industries.

In addition, there is also a threat to the logistics of coffee exports, mainly due to the lack of containers and port congestion. According to the president of the Colombian National Association of Coffee exporters (Asoexport), roads in many parts of Colombia have been struck and blocked by truck drivers, affecting the country's traffic and logistics. In addition, ports in many countries are congested due to shipping disruptions caused by geopolitics and the Red Sea crisis, and Colombia is no exception, with serious port congestion and container shortages.

These situations have greatly affected the country's coffee exports, which are currently piling up at the port terminals, which has also led to cost overruns and inefficiencies for many coffee exporters due to additional costs such as storage, retention, pre-stacking and so on.

Even if there are many difficulties, the market is still optimistic about the Colombian coffee industry, with a lot of growth in coffee production and supply. However, the increase in Colombian production is not enough to make up for the gap caused by the reduction in Brazilian production, and coffee prices remain high.

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