Peru : we predict a lack of coffee

Last week, we opened the discussion about a potential lack of coffee. Our Jaen team dedicated their efforts to gather information on the matter. We predict that a lack of coffee should manifest in the next few months. In this mailing, you’ll find the weekly Peruvian news, a coffee availability chart as conducted among the 3,000 member cooperative farmers of the ElevaFinca alliance and our updated coffee offer.

Peruvian State News:

Although coffee availability is decreasing, we are witnessing a very solid coffee quality vs. last year (thanks to favourable weather). As we mentioned in previous communications, current restrictions in place in certain Peru regions should not affect the flow of coffee as the shutdowns are expected to continue to spare all previously-approved economic activities (including agriculture).

• Field News:Northern Peruvian producers are still harvesting, depending on altitudes:
• Lower part (1,000 – 1,300m): 100% collected - 100% sold
• Middle part (1,300 – 1,600m): 90% harvested – 60% sold
• Higher part (1,600m): 40% collected – 30% sold
• May and July shipment delays, along with a backlog in green coffee processing plants are continuing to push back export lead times.
• Despite the rise of the “C” Market prices, domestic prices remain at higher levels.
• ElevaFinca - Type-samples availability:Quarantine has not affected the courriers' work so far.
• Type-samples of 82-85+ SCA points are now available for order.

The lack of coffee begins to be a recurring topic in Northern Peru. While still speculative, it is becoming more credible as the days go by.

Lower flow of coffee into organizations’ warehouses:

We have noticed, with our alliance members, that the flow of coffee into warehouses has dropped notably over the last few weeks. This is due to well-known reasons such as the abrupt drop in collected coffee at the beginning of the harvest due to Covid19 and the low field productivity (quantity of grain per plant). In addition, we believe that the following factors need to be taken into consideration :

• Producers’ fear of being infected with Covid19: Producers take even more serious measures than the traffic restrictions dictated by the State. We are seeing many producers who decided not to leave their farm as much as they can in order to prioritize their health over the sale of coffee to the big cities. We do not blame them. In doing so, some of them are selling their coffee via their farms to the best possible customer. This behaviours brings us to the next point.
• The increase of coffee purchases directly from the farm: It is known that the larger local coffee buyers have put much more pressure on the purchase of coffee directly from the field, setting up search and collection teams to the farm to ensure the supply of coffee to protect against a possible lack of coffee.

This decision of producers to prioritize their health over sales, added to the increase in purchase pressure at the farm from larger local buyers, is causing a decrease in the flow of coffee through cooperatives. It is yet too early to quantify, but year-end results will allow to reflect on how this situation is affecting the sustainability of coffee cooperatives.

This situation is reflected in our offer.

With the help of our allied cooperatives, we have proceeded to review our offer and added other coffee options. Each coffee purchase comes with the ElevaFinca advantages and sustainable impacts at origin at no extra cost. In this current situation, we want to make sure you get a coffee offer that is tailored to your needs with quick service.

Our latest coffee offer is constantly updated here: elevafinca.com/offers

More articles via our LinkedIn page

Be well and stay safe,

Thibaud Joubert, Chief Sales Officer

elevafinca.com