Coffee Fungus Seen Cutting Up to 25% of Central America Output

Coffee farms in Central America may lose 25 percent of exportable production next year because of a crop disease known as leaf rust, providing a “little bit” of a boost to slumping prices, an industry group said.

In the 12 months starting Oct. 1, about 3.45 million bags of exportable coffee will be lost from the 13.8 million expected in Honduras, Guatemala, Nicaragua, El Salvador and Costa Rica, said Jose Angel Buitrago, the president of the Central American Organization of Coffee Exporters, or Orceca, citing figures compiled from the region’s main grower groups.

“Irregular, heavy rains in August, followed by an extended period of sunshine and high winds, created the perfect humid conditions for the disease to spread at unprecedented rates,” Buitrago said yesterday in a telephone interview from Managua, Nicaragua. The situation was exacerbated when this year’s harvest began in October, because coffee pickers carry the spores from the fungus on their clothes, undermining attempts to curb the disease with fungicides, he said.

Through yesterday, arabica coffee plunged 54 percent to $1.4075 a pound from a 14-year high in May 2011 on ICE Futures U.S. in New York after the rally encouraged producers to boost output, led by top grower Brazil. Lower prices mean less revenue to spend on controlling the disease and replacing infected trees, because most of the region’s farmers harvest 5 hectares (12.4 acres) or less and lack financing, Buitrago said.

Combined Shipments

In 2012, combined shipments from the five Central American countries totaled 13.65 million bags, or 12 percent of the world’s total of 113.14 million, data from the London-based International Coffee Organization show. A bag weighs 60 kilograms, or 132 pounds.

First found in Latin America in the 1970s, the disease, also known as Roya, is caused by the fungus Hemileia vastatrix, which attacks plants’ foliage, interferes with their ability to photosynthesize, and prevents beans from reaching full maturity.

An aging tree population, with plants over 25 years old, has made plantations more susceptible, said Buitrago, who is also the president of Excan, Nicaragua’s main exporter group.

Growers planted more beans favored by specialty companies such as Starbucks Corp., and those varieties are more susceptible to fungus, he said.

To contact the reporter on this story: Marvin G. Perez in New York at mperez71@bloomberg.net

To contact the editor responsible for this story: Steve Stroth at sstroth@bloomberg.net

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