Brazil lifted its forecast for its coffee harvest for both this year and last year, saying yields had beaten earlier expectations, but slashed its forecast for sugar output, following downgrades from private commentators.
The official Conab crop bureau revised its estimate for the 2015 Brazilian crop to 43.24m bags, an upgrade of nearly 1.1m bags from a September estimate, if still a number reflecting drought damage, coming in well below the output of 60m bags that the country is believed capable of.
The revision reflected an increased estimate for the bean yield, from harvest results, as well as evidence from coffee processing, the bureau said.
The estimate for the harvested area was actually trimmed by some 8,000 hectares, to 1.92m hectares.
Attempt to recoup losses
The production upgrade in the main reflected an increased estimate for the arabica crop, lifted by some 750,000 bags to 32.05m bags, centred on the southern and centre west area of Minas Gerais, Brazil’s top arabica-producing state.
The yield in this region had, rather than remaining flat at 21.6 bags per hectare, recovered to 22.6 bags per hectare, helped by less severe pruning by growers in the hope of maximising short-term production.
Conab flagged an “expectation that market prices would remain favourable and the need to generate income to compensate for losses” last year to persistent drought.
However, the bureau also lifted its estimate for the Brazilian robusta crop, by some 330,000 bags to 11.19m bags, down in the main to an upgrade of nearly 10,000 hectares, to 283,124 hectares, in the area in Espirito Santo, the top growing state for the variety.
More in Mata
Conab also lifted its estimate for Brazil’s 2014 harvest, by 300,000 bags to 32.60m bags, a revision down largely to an assessment that area in the Zona de Mata region of Minas Gerais had, at 293,337 hectares, been some 9,000 hectares higher than previously thought.
The revision comes three weeks after US Department of Agriculture staff in Brasilia said that last year’s Brazilian coffee crop had been higher than had been thought – at 54.3m bags, a 3m-bag increase on the USDA’s official estimate.
Indeed, even with Thursday’s upgrades, Conab remains far more downbeat on Brazil’s coffee production than most other commentators for both 2014 and 2015, with Volcafe for instance pegging this year’s output at 48.3m bags, and broker Marex Spectron putting it at 49m bags.
‘Inferior sugar content’
However, Conab followed a trail already broken by the likes of Czarnikow and Platts Kingsman in on Thursday cutting its estimate for sugar output in Brazil’s key Centre South region, thanks to rains which have disrupted harvesting and cut the sugar concentrations in what has been cut.
Conab slashed its forecast for Centre South sugar output by 2.4m tonnes to 31.3m tonnes, saying that “despite larger cane production in Sao Paulo state, the [sugar content] seen for this crop is inferior which results in reduced amounts of processing products”.
Rains dilute sugar concentrations in cane, besides encouraging plants to expend reserves on growth.
The sugar estimate for production in the drought-hit North East region was downgraded too, by 300,000 tonnes to 3.3m tonnes.
‘Wettest in recent memory’
Earlier, Czarnikow cut its forecast for Centre South sugar output from 31.5m tonnes to a six-year low “close to 30m tonnes”, highlighting the wet weather, which encourages mills to turn cane into ethanol rather than sugar, which becomes more difficult to cystallise out.
“Cumulative rainfall so far this year has been over 20% higher than the historical average, while November has been the wettest in recent memory,” the London-based merchant said.
The harvesting delays mean that mills will be able to process only some 582m tonnes of the 650m tonnes of cane on offer.
Earlier this week Platts Kingsman cut its forecast for Centre South sugar output in 2015-16 by some 700,000 tonnes, to 30.36m tonnes, citing the loss of rains of 6.6 days of crushing activity in October, and 15.5 days last month.
“December also looks wet with possibly seven days or more lost to rain in the first half of the month,” the group said.
(Source – http://www.agrimoney.com/news/brazil-lifts-coffee-harvest-estimates—but-rains-prompt-sugar-downgrade–9127.html)