Federation cites benefits from tree-planting program seeks to raise crop to 16 million bags as soon as 2018
By Andrew Willis (Bloomberg)
Colombia, the world’s third-largest coffee supplier, will produce more this year than previously predicted after a tree-planting program helped to boost yields, according to the country’s growers’ federation.
Output will be almost 14 million bags in 2015, the group’s Chief Executive Officer Roberto Velez said in an interview in Bogota Tuesday. That compares with an August forecast by the Federación Nacional de Cafeteros de Colombia, or FNC, for 13 million bags. A bag weighs 60 kilograms, or 132 pounds.
The country is set for a bumper arabica-bean crop of about 1.4 million bags in both November and December. Total coffee exports in 2015 are predicted by the FNC at 12.5 million bags, beating previous targets despite the shortage of rain caused by the El Nino weather phenomenon, Velez said. Next year’s crop will depend on rainfall but could be similar, he said. FNC also plans to increase the density of tree plantings, lifting productivity to 22 bags per hectare in 2018 from 16.7 bags now.
“We’re aiming for 16 million bags in about three year’s time,” Velez said.
Concern over the impact of El Nino prompted Colombia to lift export restrictions on Oct. 15. The lack of moisture has increased the prevalence of less-dense beans in the country to about 18 percent of the crop compared with a typical incidence of 10 percent. There have been no exports of lower-grade beans since the lifting of the restrictions, as it takes “several months” to find buyers, Velez said. Rain and domestic prices will determine export levels of lower-grade beans next year, he said.
The federation is urging farmers to increase fertilizer usage to boost productivity. It expects a government-backed fertilizer subsidy to be announced next week following a meeting with ministers.
The devaluation of Colombia’s peso this year has helped its producers mitigate the effects of low prices in New York, where arabica futures prices have fallen 25 percent so far in 2015.
The federation wants producing nations and buyers to stabilize prices. The proposed plan could see roasters pay above market prices during low-price cycles and less during high-price cycles, Velez said. Representatives from Honduras, Guatemala, Mexico, Peru and Costa Rica endorsed the idea at a meeting last week in Costa Rica. They now plan to bring the idea to a International Coffee Organization conference in Ethiopia next March.
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