Brazil's economy and coffee harvest face El Niño‑linked slowdown

Economists expect Brazil's gross domestic product to expand 1.9% in 2024 and 1.8% in 2025, with inflation averaging 4.7% this year. A Reuters poll of 40 analysts suggests the central bank will make only one more quarter‑point rate cut, while fiscal pressure ahead of the October presidential election is likely to be met with higher taxes rather than spending cuts.

The same El Niño weather pattern threatens the coffee sector. The Brazilian Coffee Industry Association warned of a 15‑20% reduction in the 2024 harvest, saying, "We are now talking about a crop loss of 15% to 20%,". Growers have improved irrigation and other climate‑resilient practices, but irregular heat and rainfall risk lower bean quality and a decline in canephora output, especially in key producing states such as Espírito Santo.