Global production of coffee will exceed demand by 10.9 million 60-kg bags in 2018/19, the US Department of Agriculture (USDA) said on Friday in its second forecast for the crop year, as Brazilian and Vietnamese output reach record highs.
Global production was revised up to 174.5 million bags from a June forecast of 171.2 million. Consumption was revised slightly higher, to 163.6 million bags from 163.2 million. Global ending stocks, as a result, are expected to increase by 7.1 million bags to 37.1 million, the highest levels since 2014/15.
Much of the supply increase is driven by Brazil, where good weather has enabled a record-large crop. The USDA revised upward its expectations for Brazilian production to 63.4 million bags from the 60.2 million it projected in June.
In Vietnam, production is also at a record, and is expected to reach 30.4 million bags from a previous forecast of 29.9 million. Good weather and an increase in cultivated area have bolstered the Vietnamese harvest.
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