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Brazilian coffee farmers are expected to produce 53.4 million 60-kg bags in 2019, a drop of 10.8 percent from the record crop seen in 2018, Brazilian statistics agency IBGE said on Thursday.

Despite being smaller, the expected volume is relatively large considering that most of the country's coffee fields will be in the off-year of coffee's biennial production cycle. A 53.4 million-bag crop would be the largest for an off-year.

IBGE runs monthly projections for Brazil's agricultural production, but commodities players usually pay closer attention to estimates from another government body, the crop supply and agricultural research agency Conab.

IBGE researchers expect production of arabica coffee to fall 14.9 percent in 2019 to 38.2 million bags, but output of the robusta variety to grow 1.5 percent from last year to 15.2 million bags in 2019.

Arabica coffee is typically demanded by makers of higher-quality brands, while robusta is a key ingredient in instant coffee.

Robusta trees are less susceptible to the biennial production cycle, which usually affects arabica fields strongly.

Other forecasters also expect good production in 2019. The research team at Dutch bank Rabobank projects 56.8 million bags, putting robusta volume at 18 million bags. Harvest starts around May. Weather conditions have been good, in general, despite a long dry spell in the second half of 2018.

Copyright Reuters, 2019


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