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Issue Date: Vol. 52, No. 8, August 2012, Posted On: 8/13/2012

Brazil's Coffee Yield Offsets Declines In Other Regions, Drier Weather Boosts Quality

by Staff Reporter
TAGS: coffee market, coffee prices, coffee futures, Brazil's coffee output, weak coffee crops, Flavour Coffee, coffee harvest, improved coffee bean quality, coffee supplies, office coffee service, vending

RIO DE JANEIRO, Brazil -- A 13% increase in Brazil's coffee output is making up for weaker crops in Vietnam and Colombia, according to Citigroup Inc.

Brazil, the world's largest coffee producer, is expected to harvest 56 million bags in the current 2012-13 season, the bank said. Meanwhile, a Bloomberg survey found that Vietnam might yield 10% less coffee in the season that starts in October. Colombia's crop is expected to be unchanged at 7.5 million bags next season, which is still below the 2007-08 level of 12.5 million bags, the news agency reported.

Separately, Bloomberg reported that reduced rainfall in Brazil's coffee- growing regions has improved the quality of this year's crop, according to Rio de Janeiro-based broker Flavour Coffee.

Above-average June rains delayed the 2012-13 crop and reduced the quality of beans already picked, since they could not be cleaned and dried under ideal conditions, according to the broker. But drier weather in growing regions has reportedly accelerated the harvest and improved bean quality.

Anticipation of increased supplies in Brazil has driven a 23% decline in Arabica coffee prices this year, following a 14-year high last May.

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