Brazil’s coffee harvest may rebound 12 percent next season as producers take advantage of a doubling of prices in the past year, according to the International Coffee Organization.
The world’s biggest producer of arabica beans will “match or even exceed” the 48 million bags reached last season, ICO Executive Director Jose Sette said today in a telephone interview from Istanbul. Current prices give “all sorts of incentives for growers” to maximize production, which is expected to be around 43 million bags this season, he said
Arabica coffee reached a 14-year high on May 3 as adverse weather hampered production inColombia. The Andean nation is the second-largest producer after Brazil of mild arabica beans used by specialty brewers like Starbucks Corp. (SBUX)
Arabica coffee for July delivery fell 0.15 cent to $2.8740 a pound at 2:00 p.m. on ICE Futures U.S. in New York. Earlier, it gained as much as 2.3 percent. Coffee reached $3.089 a pound on May 3, the highest since May 1997.
Higher prices will slow global coffee demand growth in 2011 from last year, when consumption climbed 2.4 percent to 134 million bags, according to Sette. Consumption growth this year will be less than that of last year or unchanged, he said.
Worldwide, production will be little changed in the crop year beginning in 2011 from the prior season’s estimated 133 million bags because of the lower-yielding half of a two-year cycle in Brazil. Output will be a “bit less or almost equal,” he said.
Brazil produced a record 48.5 million bags in 2002, according to Brazil’s Agriculture Ministry’s crop forecasting agency, known as Conab.
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