Covid-19's Impacts on Brazilian Coffee Demand: What We Expect From Consumers and the Industry

“The on-premise channel was hit much harder than the off-premise, as reflected in the nominal revenues of total foodservice, which plummeted by 53.8% from March to October 2020, while the nominal revenues of supermarkets rose by 16.9% in the same period,” according to Guilherme Morya, Senior Analyst – Beverages.

Currently, Rabobank forecasts Brazilian demand at 20.6 million bags in 2019/20, 0.5% lower than last season and a recovery of 0.5% for the 2020/21 cycle.

Independent coffee shops and quick-service restaurants were more impacted, especially those with limited offerings. “The uncertainties in the landscape should limit new investments in this segment until a definitive solution to the pandemic is found,” says Morya.

However, the long-term trends haven’t changed. Despite the challenging outlook, the environment remains interesting for new investments – not only for M&A but also for new premium products and e-commerce.