Brazil’s Coffee Growers Accelerate Harvesting After Dry Weather

Coffee growers in Brazil, the world’s largest producer, accelerated harvesting of this year’s crop as dry weather returned to producing regions this week, according to Rio de Janeiro-based broker Flavour Coffee.

Growing areas will get dry weather for an extended period starting June 5, Sao Paulo-based weather forecaster Somar Meteorologia said in a report e-mailed on June 3. There was “abnormal rain” in the beginning of this month, it said. Brazil is harvesting its 2013-14 crop and production will be a record for a year in which trees enter the lower-yielding half of a two-year cycle, the government estimates.

“Farmers accelerated the picking, taking advantage of this ideal weather, sunny, dry and warm temperatures during day light,” Flavour Coffee said in a weekly report e-mailed yesterday. “The whole Brazilian coffee belt from Parana until Bahia is in full harvesting activities.”

Brazil will produce 48.6 million bags of coffee in 2013, the government’s crop-forecasting agency known as Conab said on May 14. Production of arabicas, favored by Starbucks Corp. (SBUX), will total 36.4 million bags, while output of robusta, used in instant coffee, will be 12.2 million bags.

Brazilian arabica beans of fine-cup quality for shipment in July and August were at a discount of 12 cents a pound to the price on the ICE Futures U.S. exchange in New York, compared with 10 cents a pound a week earlier, data from the broker showed. Beans for shipment from September onward were at a discount of 16 cents a pound, unchanged from a week earlier.

Good Cup

Coffee of good-cup quality for shipment in July and August was at a discount of 17 cents a pound compared with 15 cents a pound last week, according to Flavour Coffee. Good-cup beans for shipment from September onward were at a discount of 20 cents a pound from 19 cents a pound last week. Fine cup coffee is usually more expensive because of its taste.

“The demand that is coming from overseas still was concentrated for new crop shipments,” Thiago Cazarini, a broker at Cazarini Trading Co., a broker in Varginha, Brazil, said in a separate report e-mailed yesterday. Varginha is a city in Minas Gerais, Brazil’s largest arabica-producing state.

Conillons, as Brazilian robusta beans are known, were trading at a premium of 10 cents a pound ($220 a metric ton) to the price on NYSE Liffe in London for shipments in June and July, unchanged from last week, Flavour Coffee data showed.

“Premiums remain too high, attracting no buyers,” Flavour Coffee said, referring to Brazilian robusta coffee.

Robusta for delivery in July was little changed at $1,863 a ton by 11:51 a.m. in London. Arabica for July delivery fell 0.4 percent to $1.29 a pound in New York.

To contact the reporter on this story: Isis Almeida in London at Ialmeida3@bloomberg.net

To contact the editor responsible for this story: Claudia Carpenter at Ccarpenter2@bloomberg.net.

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