There was a slight rally in Arabica prices during the month of May, with the monthly average of the 2nd and 3rd positions on the New York futures market up from 136.23 US cents per lb in April to 137.03 US cents per lb in May. However, in the case of Robusta, the monthly average on the London futures market fell by 2.5%, with the price down to 100.89 US cents per lb in May compared to 103.48 US cents per lb in April. As with other agricultural commodity prices, coffee prices remain firm, even though fluctuations in exchange rates for the US dollar continue to reduce profitability. Since prices of oil and oil products are reaching new record levels, with consequent increases in the investment costs of coffee growing, the supply of coffee will only be sufficient to meet demand if price levels remain firm. My preliminary estimate of world production for crop year 2008/09 remains unchanged in relation to the level of 127 million bags indicated previously (Letter from the Executive Director – April 2008).
Exports during April totalled 8.8 million bags, the same level as that recorded in March. However, exports during the first seven months of coffee year 2007/08 (October 2007 – April 2008) fell by 4% compared to the total for the same period in coffee year 2006/07. During the first seven months of coffee year 2007/08 Robusta exports were down by 8.6% compared to coffee year 2006/07, while Arabica exports fell by only 1.5%.
Lastly, the International Coffee Council held its 100th Session during May. At this regular session, a number of countries signed the International Coffee Agreement 2007. The Council also considered preparatory documents, including the revision of ICO rules and regulations and terms of reference for committees and other bodies to be established under the provisions of the new Agreement. It should be noted that in addition to these meetings, the ICO organized a very successful Seminar on Geographical Indications (GIs) for Coffee on 20 May 2008, which enabled countries to share their practical experiences with GIs and other intellectual property tools, as well as to receive information on the current legal status of GIs in major consuming markets.