Azernews.Az

By Bloomberg

Coffee farmers in Indonesia, the world's third-biggest producer of robusta beans, will probably harvest a record crop next year as rains boost flowering and cherry development in the main growing regions. Futures fell.

Output is set to increase 8 percent to 650,000 metric tons starting April 1 from 600,000 tons this year, according to the median of five trader estimates compiled by Bloomberg. That exceeds the all-time high of 630,000 tons reached in 2009-2010 and in 2012-2013, U.S. Department of Agriculture data show.

The bumper harvest would follow an almost record crop in Vietnam, the largest robusta grower, where picking starts this month. Futures surged 28 percent in London this year on expectations global supplies will trail demand as drought cuts output in Brazil, the top producer of the more expensive arabica beans and the second-biggest supplier of robusta. Rain from Sumatra to Sulawesi in Indonesia this week will aid soil moisture and cherries, MDA Weather Services says.

"Production next year has pretty good prospects compared with this year," said Mochtar Luthfie, head of research and development at the Lampung chapter of the Association of Indonesian Coffee Exporters and Industry. "Most trees in Lampung have started to produce cherries. With no extreme weather through November, output will most probably be higher."

Robusta futures dropped as much as 0.7 percent to $2,157 a ton on ICE Futures Europe today, before trading at $2,169. Arabica, favored by Starbucks Corp., almost doubled this year to $2.194 a pound in New York. Temperatures will rise in Brazil's coffee belt, increasing stress on trees already suffering from drought, World Weather Inc. said Oct. 13.

Vietnamese Growers

Farmers in Vietnam are set to gather 1.69 million tons in the 12 months started Oct. 1, a Bloomberg survey showed this month. That compares with 1.71 million tons produced a year earlier, which was the highest ever. Exports rose to 97,353 tons in September from 61,977 tons a year earlier, according to General Customs Department data.

In Indonesia, supplies have started to decline as harvesting nears its end for this year. Daily bean deliveries from plantations to warehouses in Bandar Lampung fell to about 400 tons this month from 2,000 tons at the peak of the harvest in July, Luthfie said in an interview on Oct. 9.

The provinces of Lampung, Bengkulu and South Sumatra are the main producing regions for robusta beans. The area known as the Golden Triangle accounts for about 75 percent of output. The region's supplies are shipped from Panjang port in Lampung. Arabica grows mostly in northern Sumatra and Java.

Soil Moisture

Moderate rains will favor northern Sumatra this week and lighter showers are forecast for south of the island, Java and Sulawesi, MDA in Gaithersburg, Maryland said Oct. 14.

"Expected rains across northern coffee areas will provide ample soil moisture for arabica cherry growth, while showers in southern areas will favor early flowering of the new robusta crop," MDA said in a note.

The rains will help trees to produce good quality beans, said Moelyono Soesilo, marketing and purchasing manager at Semarang, Central Java-based trader PT Taman Delta Indonesia.

"Cherries need regular rain every 10 days to two weeks," Soesilo said in interview in Jakarta on Oct. 10. "Reports show coffee producing areas in South Sumatra and Lampung received rather heavy rain last week, which was good," he said, adding the outlook will become clearer in November.

In September, Volcafe Ltd. estimated that the global shortfall in robusta beans will be 1.9 million bags in the 12 months from October. The world market, including arabica and robusta, will have a shortage of 8.8 million bags, the most in nine years, from a surplus of 7 million bags a year earlier, the Winterthur, Switzerland-based unit of commodities trader ED&F Man said Sept. 5.