As Peru nears the completion of the 2022 coffee harvest season, cooperatives throughout the region are facing several challenges with fulfilling coffee contracts in a timely manner.
What Happened?
The low productivity in the field, along with cooperatives struggling to obtain sufficient harvest capital and a very high internal street price for coffee, have led cooperative management teams to request contracts to roll forward by several months, or perhaps even to the next harvest season.
Many of the cooperatives are unable to secure sufficient coffee from their membership base, which leads to a lack of coffee to fulfill their contracts on time. Approximately a quarter of all contracts written with cooperatives throughout northern Peru are seeking resolution for this delay of coffee delivery to their cooperative warehouses.
How Can Coffee Buyers Help?
Buyers should be aware of the volume and delivery expectations, with the understanding that there will be a high risk of delay or non-delivery.
Consider restructuring shipping months on each contract with cooperatives
Work with cooperatives to roll contracts into the new year.
Providing access to harvest capital for your contracts will help to deliver shipments.
Productivity is expected to recover for the 2023 crop. Our technicians report a good perspective for the next harvest. We are seeing good flowering along with an advance of grain maturation in some of the low-altitude areas in different regions of Peru. Our technical team will continue to monitor the plants and we will be back soon with more details.