The most important data point used to gauge the health of the U.S. coffee industry has suddenly gone dark, giving an added advantage to the biggest trading houses and roasters.
Data tracking the amount of coffee parked in warehouses at American ports -- which helps analysts, traders and cafe owners alike judge supply and demand -- was suddenly pulled from the market last month. It had previously been published monthly by the Green Coffee Association for decades.
The surprise move is fueling frustration up and down the supply chain. The stockpile information has traditionally been one of the best ways to understand whether the coffee imported into the U.S. is being ground and roasted for consumption -- or if it's just piling up, signaling a drop in demand. As a result, figuring out how much coffee the world's largest consuming nation is drinking just got a lot harder.
"The U.S. port stock data has been a beacon of certainty for many years," said Carlos Mera, a senior commodity analyst at Rabobank. "There is no replacement for it."
New York-based Green Coffee Association, whose members include J.M. Smucker and Louis Dreyfus, confirmed in an email that the reports will no longer be published and declined to comment beyond that. The group's move was so sudden that it didn't even warn all of its board members or member companies before revealing it would stop releasing the closely watched figures, according to people familiar with the matter who spoke on the condition of anonymity because the information is private.
Some traders pointed to a 2020 decision by the European Coffee Federation to stop publishing its own data on a port-by-port basis, since some sites had so few participants that someone could easily extrapolate company-specific numbers. The European group now only releases aggregate data. Others speculate the Green Coffee Association is looking for a way to monetize the data. That's what ICE Futures U.S. did when it started charging for historical figures.
"There have been several series of data that went behind a paid firewall and members only," said Judy Ganes, president of J. Ganes Consulting. "It sure makes reporting on the market tougher."
The move initially ignited fears that other groups could pull their data, too, rendering the market more opaque. But so far, no one is following suit. The European Coffee Federation said it has no plans to suspend its publication of coffee stockpiles at the continent's ports. The Colombian growers' federation and Brazil's top exporter group Cecafe have also played down the fears. Leaders of the Vietnam Coffee Association declined to comment.
"If we stop releasing data, then the market will be even more deprived of information, and that's not a path we want to follow," Cecafe President Marcio Ferreira said.
Other commodity markets have also become less transparent in past years. The U.S. Department of Agriculture stopped producing cocoa statistics due to budget cuts, and Brazil's government agency Conab no longer releases end-of-season stockpile statistics every March.
The port data showing how many 132-pound bags of unroasted whole beans are in storage was especially crucial during the early days of the pandemic, when previously agreed shipments continued flowing into the U.S. but Americans without a commute were mostly skipping their morning brew.
The change is one more concern for a market already plagued with a lack of transparency. In many cases, crop forecasts by producing countries vastly differ from numbers published by consuming nations and estimates by private trading houses.
"The lack of data is fueling mistrust," said Carlos Santana Jr., a commercial director at the Brazilian unit of coffee trader Ecom Agroindustrial. "It's a source of frustration" for producers, he said, because there was an expectation stockpiles would fall -- a signal that could suggest higher prices ahead.
The new lack of transparency may also give some well-positioned traders an edge. Larger trading houses and roasters might still be able to get an idea of what's going on at the ports based on their close relationships with many warehousing companies. Smaller players "will be left guessing," Rabobank's Mera said.
"Some information is regarded as good for the free flow of the market," said Neil Rosser, an analyst at London-based consultant Bison Luxley. "Otherwise it just becomes: 'Can you buy that information? Do you have the power to get that information?' That's not good for a free market."
Information for this article was contributed by Mai Ngoc Chau and Andrea Jaramillo of Bloomberg News.