Colombia’s Coffee Crop May Be Below 7 Million Bags, Volcafe Says

Coffee production in Colombia, the world’s second-biggest arabica grower, may be less than 7 million bags in the current season because of rainstorms, said Volcafe Ltd.

“There is a more generally accepted consensus of a 2011-12 harvest below 7 million bags,” the unit of commodities trader ED&F Man Holdings Ltd. said in a report to clients e-mailed today. “The rains continue to cause problems for coffee moisture management in post-harvesting.”

The Colombian coffee harvest has failed to recover since wet weather reduced output by 32 percent in the 2009 calendar year. Last year’s crop was the smallest since 1976. The nation’s state-run weather agency this week predicted that rains soaking farms in central growing areas probably will persist through June.

Colombia’s output was 7.8 million bags in the previous season, Volcafe estimated in February. Rains caused by the La Nina weather pattern, associated with cooler-than-normal equatorial waters in the Pacific Ocean, have left production in the Andean nation below the 2007-08 level for four seasons, data from the U.S. Department of Agriculture show.

Colombian coffee for May and June shipment was trading at a premium of 29 cents a pound to the price on ICE Futures U.S. in New York, Volcafe data show. That compares with 30 cents last week.

“Differentials remain firm,” Volcafe said, referring to a discount or premium paid to obtain physical coffee in relation to futures prices. “Some demand was present this week and business was concluded.”

Arabica coffee for July delivery rose 1.5 percent to $1.7825 a pound by 11:09 a.m. local time on ICE. Prices are down 21 percent this year. Brazil is the largest global grower of the variety, favored for specialty beverages.

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