Drought Could Cut Brazil 2015 Coffee Crop Below 40 Million Bags

Brazil, the world’s biggest coffee exporter, may harvest the smallest crop since 2009 next year as trees suffer the worst drought in decades.

The country may see its coffee crop fall below this year’s harvest to less than 40 million bags in 2015, Silas Brasileiro, president of Brazil’s Coffee Council, said in a phone interview Thursday from Brasilia. The drought has already helped boost the price of coffee futures 61 percent this year in New York.

Rainfall in the southeast Brazil, where more than 90 percent of Brazil’s coffee is grown, was the lowest in 80 years in January and February, according to the government’s weather agency. That has left trees small, weak and less able to bear fruit next season.

“We can already disregard any possibility of a bumper crop for next year,” Brasileiro said. “We will harvest enough to meet our share of the global demand, but the inventories will be real low after two bad crops.”

This year’s crop is expected to be between 40.1 million 60-kilogram bags and 43.3 million 60-kilogram bags, according to a Procafe, a coffee research institute. Brazil’s Coffee Council, which represents growers, expects the crop to come in at the lower end of the estimate.

Before it's here, it's on the Bloomberg Terminal.