Papua New Guinea recorded PGK1,233 million in cocoa exports in 2024, surpassing coffee’s PGK989 million. However, forecasts indicate coffee will reclaim its top position in 2025 with predicted revenues of PGK1,580 million. Cocoa faces challenges due to stagnant supply despite price surges, while coffee benefits from strong market demand and recovery after previous low yields.
In 2024, Papua New Guinea (PNG) achieved unprecedented cocoa export revenue of PGK1,233 million, surpassing coffee’s PGK989 million for the first time in history. However, this high ranking is expected to be temporary as the cocoa supply cannot rapidly increase due to smaller historical crop sizes. Conversely, coffee is predicted to have a strong recovery after a low-volume season, suggesting that coffee may reclaim its leading position in the following year.
Forecasts for 2025 predict coffee export revenues will reach PGK1,580 million versus PGK1,363 million for cocoa, contributing to a total combined revenue of PGK3 billion, surpassing last year’s PGK2,222 million. The current price surge in coffee is influenced by Brazil’s unfavorable weather affecting crop yields, while cocoa prices have also been robust due to global supply shortages. For 2025, cocoa prices are expected to stabilize around USD8,000/ton.
In the global cocoa market, crop production saw a significant decline of 13.1 percent to 4.3 million tons in 2024 due to droughts and diseases, particularly impacting Ghana and Côte d’Ivoire. Despite the challenging situation, cocoa prices rose dramatically, with an average of USD8,214/ton, indicating strong demand continues. However, recent rainfall in West Africa raised expectations for improved crop yields, leading to a slight price correction in February to USD9,917/ton.
Meanwhile, PNG’s coffee export volume totaled 827,100 bags in 2024, which was a decrease from the previous year. The expected dynamics of alternating crop yields suggest that the 2024-25 season will have lower volumes, but a strong recovery is anticipated in the following season, potentially surpassing a million bags in exports by 2025. High coffee prices are also expected to incentivize farmers to deliver more produce to markets.
Despite high cocoa prices, which led to an increase in exports by 1.3 percent year-on-year in 2023, PNG faces challenges in boosting overall tonnage due to farmers transitioning to other agricultural ventures like balsa wood. However, the profits from high prices may enable small farmers to invest in better crop management, suggesting an export target of 42,000 tons of cocoa for the coming year.
Historically, coffee has outperformed cocoa in terms of export receipts in PNG. For 2025, it is projected that coffee will reclaim its leading position with higher revenue stemming from both increased volumes and price hikes, benefiting from ongoing global demand and crop recovery in Brazil.
PNG’s position in the global market remains crucial since it sells its cocoa and coffee at prices determined by international markets. Maintaining competitive pricing is essential for PNG exports to thrive in the global market landscape. Should domestic prices fail to align with global trends, it could jeopardize PNG’s market competitiveness in both coffee and cocoa industries.
In summary, Papua New Guinea experienced a record year for cocoa exports in 2024, yet forecasts suggest coffee will regain its leadership in 2025 driven by higher prices and expected volume increases. Global cocoa production issues have elevated cocoa prices significantly, but challenges remain due to a lack of supply growth. Meanwhile, coffee exports are on the rise despite a recent downturn, indicating a recovering market poised for future success. Maintaining competitive pricing on the international stage will be essential for sustaining this growth.
Original Source: www.fijitimes.com.fj
