Brazil, the world’s biggest coffee producer and exporter, is raising the minimum domestic prices for the commodity to help increase income for farmers after international prices slumped.
Agriculture Minister Antonio Andrade plans to announce the new benchmarks for arabica and robusta coffee in a news conference in Brasilia scheduled for 3 p.m. local time today, according to an e-mailed statement. The minimum price for the mild-tasting arabica variety is currently 261 reais ($130) per 60-kilogram (132-pound) bag and the one for robusta coffee is 156 reais per bag.
Arabica coffee futures in New York have declined 23 percent in the past year after Brazil reaped a record crop last year and is set to almost match the amount this year. The minimum prices are the benchmark for government purchases of coffee from producers.
Coffee for July delivery jumped as much as 4.2 percent today after the ministry said it would announce a new minimum price. It rose 3.8 percent to $1.398 per pound at 12:30 p.m. on ICE Futures U.S. in New York.
Joao Rabelo, the Finance Ministry’s undersecretary for agricultural policy, said in an April 18 interview that the government was studying the increase of the minimum price to help coffee growers and planning an announcement within weeks.
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