Last year, Peruvian coffee bean exports reached their highest level in more than ten years.
A decline is expected this year, with plantations affected by climate change.
New rules in the European market are also putting producers on alert.
Last year, coffee became Peru’s third most important agricultural export product, behind grapes and blueberries.
As a result, sales exceeded US$1.2 billion between January and December, an increase of more than 60% compared to the previous year.
The 2022 result was also the highest since 2011, reaching US$1.5 billion.
In subsequent years, no more than US$750,000 had been achieved.
However, the first quarter of this year saw a year-on-year decline of more than 70%.
Cumulative coffee shipments reached only US$92.1 million, compared to the more than US$300 million achieved in the first three months of 2022.
However, Lorenzo Castillo, head of the National Coffee Board (JNC), explains that this decline is not due to poor performance of shipments but to a bias in shipments in the first months of last year.
“Due to vessel shortages, shipments were delayed in 2021, and much of the crop was shipped in the first quarter of 2022, so we have some interesting numbers,” he says.
With this in mind, he reiterates that exports will be down this year due to the very low balances of the last crop.
“This leads us to a forecast of 4 million to a maximum of 4.2 million quintals of exports,” he estimates.
[Unit of Measurement: quintal (55.2kg of parchment)]
PEST INFESTATION
The decline in stocks is not the only factor that could affect exports, but the reduction in coffee production this season due to climatic phenomena that have led to the appearance of pests.
The irregular alternation between heavy rains and high temperatures has led to the appearance of anthracnose on coffee plants, complains Elver Pérez, a coffee farmer from the Jepelacio district in the San Martín region.
The pest, spreading in coffee plantations in the northeastern corridor, attacks plants in the production phase.
“It starts on the leaves and dries the branches from the top to the trunk. This causes problems with the fruits; they do not ripen 100%,” he explains.
This pest is in addition to the endemic presence of coffee rust (Hemileia vastatrix) in this region of the country.
According to the president of the Association of Agricultural Producers of Alto Rioja, the rains also affect the current season.
“They significantly affect the harvest and the drying process”.
He adds that they also cause the fall of ripe grains.
Another factor that affects the harvest is the lack of labor.
This is because casual laborers migrate mainly to the coast rather than coffee-growing areas.
“People prefer to grow asparagus or blueberries, and the harvest takes place simultaneously for everyone,” Pérez said.
FALLING PRICES EXPECTED
Last year, Brazil and Colombia, the world’s main coffee producers, recorded a drop in production due to climatic phenomena such as droughts and frosts that affected their harvests.
This reduced the supply of coffee on the market, driving up the price of the Peruvian bean.
For exports, the average price per quintal reached US$230.
“This year, it is also expected that there will not be a full harvest in Brazil, so good prices are on the horizon,” says Lorenzo Castillo.
He estimates that the price could remain around US$200 per quintal.
This would generate exports worth just over US$800 million.
NEW REGULATIONS IN THE EU
The European Union, for which more than 50% of Peru’s coffee is destined, is about to adopt a regulation on deforestation-free products.
This regulation is one of the main concerns of local coffee producers, as it requires that products – including coffee – entering the area must have a certificate attesting that forests have not been affected.
The JNC pointed out that “there is an urgent need to create a plan for converting coffee cultivation linked to zero carbon emissions. Otherwise, exports will decrease drastically.”
He also called on the government to develop an action plan.
In response, Jorge Figueroa, coffee chain specialist at the Ministry of Agricultural Development and Irrigation (Midagri), said an intersectoral working group would be established by July at the latest to address the issue.
In addition to Midagri, the ministries of Environment, Foreign Trade and Tourism, Production, and Foreign Affairs will also be involved in the working group, likewise the coffee producers’ associations.
“Work is being done on this issue. In Europe, (the regulation) will come out in June or July, and from then on, 18 months will be given as a transition period, and from then on, the requirement will be the requirement,” he added.
NEARLY 6% OF AGRICULTURAL LAND IS COFFEE
According to Midagri, coffee is a direct source of employment for more than two million Peruvians throughout the agricultural production chain.
The production of this bean involves 230,000 families that together cultivate about 440,000 hectares or 6% of the national agricultural area.
The main production areas are Amazonas, Ayacucho, Cajamarca, Cusco, Huánuco, Junín, Pasco, Piura, Puno, and San Martín.
In recent years, unroasted Arabica coffee has accounted for an average of nearly 90% of Peru’s traditional agricultural exports.
In terms of volume, coffee exports increased by 32.8% in 2022.
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