Dear Friends,
 

I was invited to guest write Ron’s report for February and would like to share an overview of Colombia’s current

crop and future projections.

WEATHER

For this report, I have to start with the weather. During 2020, Colombia experienced the phenomenon known as

“La Nina” that brought heavy and continuous rains throughout the country from April until November.

July and August are months when conditions should be hot and dry for the trees to stress and flower, however, rain, low temperatures and overcast skies were the norm. This said, flowerings were quite low in most of the southern and central regions which comprise 90% of the coffee growing areas of Colombia.

This will have an effect on the volume output for the coming main crop due to start in April in the following departments: Nariño, Cauca, North Huila and Tolima. At this point, it is still l too early to determine the output reduction, but guesstimates from technicians and producers talk of up to a 10-15% reduction in some areas.

The central growing regions of Colombia that comprise the departments of Antioquia, Caldas, Risaralda, Quindio and Valle also expect a volume reduction for the coming mid-year crop of up to 8-10%.

During December 2020 and January 2021, the weather has been dry and warm, perfect for the flowerings for the main crop of 2021 (Oct-Dec), which will be a blessing for those departments located in the central regions and for the mitaca crop for those departments in the south.

DIFFERENTIALS

Despite a global slowdown as a result of COVID-19, Colombian differentials remained very strong from early 2020 through the summer reducing slightly into the start of the main crop in October. By November, differentials began to rise again when shippers didn’t see the volume they expected for the main crop. I expect them to continue firm unless we see a sustained rally in the C market.

QUALITY

Low flowerings do not have any implications on the quality of the bean and although volumes might be lower, there should be no major issues that can affect the coffees to come from April to July.

Broca infestations are low, a normal weather pattern should be expected this first half of 2021 and quality should be good overall.

TOTAL CROP OUTPUT

Below you will find a chart with the production and export figures for the past crop year and calendar year. It will remain to be seen how much of the first semester will be affected in terms of volume and how much will the second semester will compensate for that reduction (provided no weather anomalies are to happen).

My rough estimates for calendar 2021 production (Jan–Dec) is 13 and 13.5 million bags 60-kg bags.

CONCLUSION

In our January report, Ron wrote the following about Colombia, which I believe is still relevant and worth another read.
 

In recent years, the coffee producing areas have been on the decline due to low and volatile prices or replacement by other annual agricultural crops, such as avocado. Climate change gradually pushes coffee producing areas to higher elevations, which will keep reducing the total coffee acreage over time. On the other hand, productivity kept increasing due to better husbandry and a younger population of trees. Productivity is currently estimated at 22 bags per hectare. If we put these two factors together, Colombian coffee production is leveling off at around 14 million bags per annum.

We must say that we are disappointed that Colombia is not embarking on a new campaign to increase coffee acreage. By the time any additional production would come online, the demand from consumers would be there.

Please do not hesitate to reach out with any questions or comments.

Best regards,

Steven Diaz – General Manager, RGC Americas steven@rgccoffee.com