MILAN – Coffee output in Brazil is likely to decline by over 15% in 2019/20 to 55 million bags as the country enters the lower-yielding half of a biennial cycle for Arabica, Lucio Dias, commercial director at Cooxupe, the world’s largest coffee-growers cooperative, said in an interview with Blomberg.
Brazil harvested a bumper crop of 63.4 million bags in 2018/19, according to Cooxupé. The latest official estimate released by Conab stands at 61.7 million bags. A wave of investments in trees, fertilizers and improved growing techniques in the past few years, as well as near-perfect weather conditions in 2018, led to record yields for both Arabicas and Robustas.
A decline in output should help sustain prices in futures markets. Prices for Arabica fell about 20 percent this year, touching the lowest level since 2006.
The annual average price paid to farmers in Brazil was the lowest in four years in local currency terms.
USDA expects global coffee output to reach a record 174.5 million bags in CY 2018/19, up 15.6 million from the previous year. Ending stocks should rise by a quarter to a four-year high.
