Global coffee deficit likely to widen in 2016/17

Marex Spectron, a trading company, had issued a deficit forecast for the coffee market in 2015/16 last week. This is supported by  Olam now. 

According to Olam, the global deficit of coffee is set to total 4.8 million bags in 2015/16. But this will be lower than expected in the previous year of 5 million bags. The Arabica coffee deficit  of 3.7 million bags, in 2015/16 is significantly higher than the Robusta coffee deficit of 1.1 million bag. 

"Despite assuming a significantly higher Brazilian crop, Olam envisages a further deficit on the global coffee market in 2016/17, though it has not yet made any estimate of its scale. The deficit looks set to be caused by growing demand. This prospect should give coffee prices a boost following their latest price slide", notes Commerzbank.