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In addition to Brazil, major upward production changes in 2002/03 versus 2001/02 include (in 60-kilogram bags): Mexico, up 500,000 bags; Nicaragua, up 300,000 bags; Thailand, up 157,000 bags; Kenya, up 130,000 bags; and Madagascar, up 100,000 bags.
Low global coffee prices for a sustained period of time have led many farmers to abandon trees and, in some cases, use less fertilizer. Not surprisingly, this reduced tree maintenance has led to lower yields. Countries where production is forecast to decline in 2002/03 include (in 60-kilogram bags): Vietnam, down 1.75 million bags; Dominican Republic, down 200,000 bags; Indonesia, down 200,000 bags; Zaire, down 170,000 bags; Honduras, down 150,000 bags; India, down 150,000 bags; Costa Rica, down 114,000 bags; and Colombia, down 100,000 bags.
Total coffee exports in 2002/03 are forecast at 92.0 million bags, up nearly 4 percent over 2001/02. Brazil accounts for most of the increase. Brazil's exports in 2002/03 are forecast at 28.6 million bags, up 15 percent or 3.7 million bags from the previous year.
Brazil's coffee production forecast in 2002/03 (July-June) is 46.9 million bags. The arabica coffee production is forecast at 35.5 million bags, while robusta production is forecast at 11.4 million bags. The Agricultural Trade Office/São Paulo (ATO/SP) staff conducted five field trips through the major coffee producing areas to evaluate 2002/03 production. Trips were made in mid-December 2001 (southern Minas Gerais), January and February 2002 (Paraná, São Paulo, center-west Minas Gerais, eastern Minas Gerais, and Espírito Santo), and mid-April 2002 (southern Minas Gerais) to observe vegetative development, cherry set, and fruit formation.
Brazil's Coffee Production
(Million 60-kilogram bags)
|Sao Paulo 1/||3.00||4.20||3.70||3.60||3.00||4.85|
Brazil's total 2002/03 exports are forecast at 28.6 million bags, a 15-percent increase compared to the 2001/02 level. Brazil's coffee is expected to remain competitive internationally due to the availability of product, low domestic prices, and the steady devaluation of the local currency vis-a-vis the U.S. dollar. Green coffee beans should contribute 26 million bags; roasted, 100,000 bags; while soluble exports are likely to remain stable at 2.5 million bags, green bean equivalent.
Brazil continues to offer government-owned stocks through its auction system.
Brazil: Auctions of Government-Owned Coffee Stocks
|Date of Auction||Quantity Offered||Quantity Sold||Price Range|
|--------60-kilogram bags--------||Brazil reais/bag|
|December 12||20,000||14,331||avg. 76.58|
Colombia's coffee production for 2001/02 is estimated to have reached 11 million bags, up from 10.5 million in 2000/01. This increase, in the face of low global prices, is because 200,000 hectares of coffee trees renovated during the1998-2000 period under a Fedecafe (National Coffee Federation) incentive program are now beginning to enter into full production. However, in 2002/03, production will not benefit as much from this factor and will begin to decline due to reduced use of inputs. Production in 2002/03 is forecast at 10.9 million bags. If low international prices persist, further decreases in production are almost certain. The historically low international coffee prices over the past year and a half, which on average are below the break-even point for growers, have forced farmers to sell off assets to generate working capital and cover living expenses. The combination of reduced farmer assets, the difficulty in finding credit, and the lack of resources in the National Coffee Fund make any recovery in Colombia's coffee sector largely dependent upon a recovery in international prices.In addition, low international prices have eliminated the contribution to Fedecafe made by growers and exporters. As a result, many of the social and production-related programs supported by Fedecafe have been almost completely eliminated and the remaining ones are dependent upon fund transfers from the government and loans from overseas financial entities.
Coffee production during 2001/02 is estimated at 12.3 million bags, a decrease of 20 percent
compared with the record level in 2000/01 because of a reduction in crop area and yield. The area
reduction occurred mainly in key robusta-producing areas like Tay Nguyen (Central Highlands)
provinces, where some low-yielding coffee trees were removed. Yields dropped due to drought and
low input use (less investment in irrigation, pruning, and fertilization). In addition, many Central
Highland areas have suffered from a prolonged drought from December 2001 until May 2002. In Dac
Lac province, the crop yield was estimated to have declined by 15 percent and the 2001/02 crop area
decreased by 7,000-8,000 hectares. During a recent visit to the province, U.S. Embassy agriculture
employees saw some coffee areas being replaced by cashew trees inter-cropped with cassava plants.
Cotton and corn are also considered by the regional government officials as good crops to replace
coffee. In Lam Dong province, where the coffee area (estimated at about 140,000 hectares) is the
second largest coffee area in Vietnam, there were about 20,000 hectares of coffee trees removed.
Coffee production is expected to be even worse in 2002/03 as a result of these factors. Coffee production during 2002/03 is forecast at 10.5 million bags, down 14 percent from this year. The province authorities are trying to encourage farmers to remove an additional 70,000 hectares of coffee trees by 2005. However, the process is slow as many farmers want to keep their coffee trees--hoping that prices will eventually improve. The provincial government strictly bans planting new robusta coffee trees by measures like land-use certificates and bank loan policies.
U.S. coffee stocks at the end of April totaled 5.3 million bags, up 32,583 bags from the March 31, 2002, level. Details follow in 60-kilogram bags:
|March 31||April 30||Difference|
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