Here - We have had a cold winter (for us) in some moments weather has been so cold that temperatures have gotten the lowest degrees for years. Fortunately, there were Jet Streams over the southwest that lasted until of beg of August -These high winds blowing from earth to sea blocked the fronts pushing them to sea not allowing they could hit coffee areas with their polar mass. There was some frost in South of Minas – like Poços de Caldas- Guaxupe - Guaranesia - Campanha - also light frost in specific areas in Parana and São Paulo -Alta Paulista - all mainly in low lands (valleys) that nowadays are not used to growing coffee. Even in South of Minas we had the occurrence in low lands.
Crop - it is fully harvested in Conillon and Arabica Group II coffees - Espirito Santo and Manhuaçu area - South of Minas/Mogiana ca 90% picked - São Paulo/Parana are done. Cerrado is the most delayed area - may be 75/80 % harvested. Quality - good to very good - screen size normal - 30/35% of high screens in running lot yield - Some producers disappointed with yield they are getting after cleaning the coffee. Normally we use ratio 3 to 1 ~
3 bags of husked beans = 1 bag of clean coffee - which represents roughly 20 kg of clean coffee per bag of husked beans -This crop it is around 17/18 kg of clean coffee. Agronomists commented that heavy rains in December, hot weather Jan/Feb and again heavy rains in March - cherries grow a thick husk -reducing the weight of beans.
Producers/cooperatives are disciplined sellers - no pressure from interior - selling on upside of NY ICE and holding on downside. They have a goal of R$500,00 p/bag -farm gate - $312,50 p/bag (exchange rate 1,60), and when exporters following New York movements bid below this level, they found very few sellers. Now, with correction of New York -45 cents in two weeks - there is more volume in offer but prices are over the target. (We are talking of standard coffee - South of Minas.)
For Cerrado - fine qualities - very few lots in offer and prices skyrockecting.
Wen New York dropped to near 2,30 - (abt 2,33) Diffs tightened to follow the correction and face internal resistance. Buyers were absent - who used to buy Brazil standard - ny 3/4 14/16 good cup at minus 30,00 - started to receiving prices at minus 15 to 16. Besides it was summer time in the Northern Hemisphere - most buyers on vacation,etc so market came to a standstill. Local brokers complained a lot due to lacking of business.
Last days with New York moving up and currency in Brazil also losing ground - Real vs dollar was at R$1,57 with monetary problems etc etc. Dollar has reacted and is now being quoted at r$1,61 - thus we have seen more trades. Diffs were corrected to minus 22 to 23 and dealers took the moment to cover some shorts.
In short, soon everybody will be back and it will be time to start looking for winter coverings.