Brazil's 2015 coffee crop seen 40.3 mln-43.3mn bags

BRASILIA: Brazil's upcoming 2015/16 coffee harvest that starts in May will produce 40.3 million to 43.25 million 60-kg bags, according to the latest research by the local government industry-linked Procafe Foundation released on Thursday.

If confirmed, the forecast commissioned and published by the National Coffee Council (CNC) would be a drop of between 4.6 to 11.1 percent from the last year's harvest of 45.34 million bags.

"The drought of 2014 hurt the 2015 harvest more than the 2014 harvest," Procafe agronomist Jose Braz Matiello said. "2016 should see a small recovery. We could see a 4-to-5 million bag increase to 46-47 million."

Arabica beans will make up the bulk of that output with 30 million to 32.15 million bags, almost in line with last year's harvest of 32.31 million bags.

This year, Brazil's conillon crop, a local variety of robusta bean, appears to have suffered the brunt of the dry weather in January. Procafe said conillon beans would account for 10.3 million to 11.1 million bags of the new crop, down as much as 21 percent from the 13 million bags harvested in 2014.

"The drought damaged the robusta crop a lot," Matiello said. "So, this is the biggest uncertainty going forward."

The report explained that dry conditions particularly in the Triangulo Mineiro region of Minas Gerais state has caused some coffee cherries to form without developing beans within their fruity encasing.

Despite the losses in the Triangulo area which could push output down 18 percent from last year there, the important Forested Zone of Minas Gerais is expected to show a 22 percent to 31 percent jump in output this year, Procafe said.

Concerns of two straight years of drought losses caused coffee prices to spike to two-year highs in January but reports on high sales volume recently have pushed them back down.

Analyst Safras & Mercado said in a report on Thursday that 79 percent of last year's crop had been sold by the end of February, up 4 percentage points from February and in line with 77 percent of the previous crop sold a year earlier.

Procafe's forecast, which looked at 2,700 farms across the coffee belt, is on the lower end of estimates of the new crop.

By comparison, Brazil's crop supply agency Conab, which itself tends to be on the lower end of the range of estimates, forecast in January that the new coffee crop would yield between 44.1 million and 46.6 million bags.