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since November 12, 2021. There are signs that market
participants are liquidating positions in commodities to fill
margin calls on other financial investments on hand that
have soared due to the war. A rebound in stocks monitored
by ICE Futures Exchange eased concerns about further
depletion of green coffee and the impact of the Rus-
sia-Ukraine war on the European economy and inflation
concerns slowed European demand.
The macro economy was just stabilizing after the
COVID-19 impact until the market started to get intense
again due to Russia-Ukraine war. The yield on the 10-year
U.S. Treasury note fell to less than 1.80 percent. Oil traded
near $110 US Dollar a barrel, having increased by as much
as 4.8 percent. Gold held steady, the dollar rose but the
euro slipped. Rising prices of commodity and energy,
At the end of January, the NCA webinar industry slowing global growth and soaring inflation weighed on the
seminar on coffee market trends in the United States men- global economic prospect. Obviously, the Russian and
tioned the prediction of the inability of global coffee supply Ukraine war will have a knock-on effect, which is very
meeting the global demand by 2050. The global demand is detrimental to the supply chain, and those changes may
expected to grow by 3 percent per year. As an emerging affect coffee stocks at destination, rerouting of containers
market, the Asia-Pacific region should be the main force in and ships, etc. João Guilherme Prata Pereira, chief trader
terms of growth. More current tea drinkers are switching at Pratapereira Comercio Importacao e Exportacao de Cafe
from tea to coffee, including the Chinese market, which is LTDA, a trading company in the Brazilian state of Minas
growing strongly. Factors such as increased disposable Gerais, told Bloomberg that due to sanctions imposed on
income, the continuous rise of coffee culture, rapidly ex- Russia by Europe and the United States, Brazilian exporters
panding number of cafes, together with the increasing are canceling their Russian and Ukrainian contracts and
demand for high-quality coffees are important driving shipping lines are also canceling or not taking bookings for
forces for the development of the market. the regions. He said hedge funds may be reallocating some
of their portfolios into better-performing assets, such as
A New Concept of Artificial Coffee grains and metals, because of the chaos caused by the war.
More of the impact of Western sanctions on Russia is only
At this seminar, I also learnt about the brand new starting to emerge, with too much uncertainty surrounding
concept of “Beanless Coffee Innovation” for the first time. liquidity issues in trade and logistics, lost business, and a
It’s an emerging area highlighted as interesting but probably sweeping rewrite of trade rules and patterns.
not “industry-changing,” referring to experimenting with
lab-grown coffee. They think it is unlikely to be as success- Market trends worthy of our attention
ful as plant-based meat, because it may not necessarily be
seen as a “solution” by consumers. The main reason is that Bearish factors: Financial investors are in a safe-ha-
plant-based meat is popular right now because consumers’ ven state given that commodity markets are under great
primary motivation for buying meat alternatives is to feel pressure; The increased prices will be passed on to the end
healthier, rather than to consider environmental sustain- consumers, with significant damage to Brazil, North Afri-
ability or impact. Thus, it might mean that consumers are ca and Eastern and Southern Europe; Depending on the
more concerned about whether a product is better for duration of the Russia-Ukraine war, there is a possibility
themselves than being driven by sustainability, so lab-grown of further damage to Robusta demand; Brazilian exports
coffee may not necessarily have a market. continue to grow.
Bullish factors: Arabica and Robusta differential
Coffee futures market trends forecast prices are remaining firm; Global shipping conditions con-
tinue to deteriorate, coffee from origins cannot be delivered
By March 4th , 2022, ICE coffee futures fell to the to destination in time while the demand for coffee increas-
lowest since November 2021 as traders weighed the impact es at destination; Supply of Arabica coffee is tight, especial-
of the war in Ukraine on demand and the impact of soaring ly Brazil and Colombia, which have confirmed a sharp re-
fertilizer costs on the prospect of world coffee production. duction in production for the new crop season; Demand
May delivery on ICE coffee futures market fell 2.8 percent resumes and grows as the impact of the COVID-19 pandem-
and were settled at 222.9 cents per pound, the lowest level ic lessens and people gradually return to work in the office.

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