Final Crop Estimate from Terra Forte

CoffeeNetwork (New York) – Brazil-based TerraForte has released their third and final Brazil crop estimate. According to the report, April and May rainfall data was highly celebrated even though being months that total volume normally is fairly low. “Fact is from January/14 to June/14 accumulated rainfalls were the worst one we have seen so far.”

Considering Terra Forte farms are amongst the most well treated farms, the company has detected 20% loss against our forecast done prior to the drought. However, TerraForte estimates 30% losses for the rest of South Minas and Zona da Mata. Cerrado is by far the better one with 10% loss. The whole Mogiana region, around 15%, South of Minas and Zona da Mata region with an average of 30% loss.

Therefore TerraForte’s 14/15 crop estimate has been revised to 28.344 million bags of Arabica and remains at 17.44 million bags of Conillon.

First estimate prior to the drought: 53.7 million bags

Second Estimate (February): 47.4 million bags

Third and final estimate: 45.785 million bags

BREAK DOWN BY REGIONS (in million bags)

2014 Prior drought                                                                           2014 after drought

SUL DE MINAS                   13.900.000                                                                                           9.730.000

CERRADO                            5.610.000                                                                                             5.049.000

ZONA DA MATA               6.100.000                                                                                             4.575.000

SÃO PAULO                        5.100.000                                                                                             4.335.000

ESPIRITO SANTO

(Arabica)                              2.200.000                                                                                             1.650.000

(Robusta)                            13.300.000                                                                                           13.300.000

PARANA                              900.000                                                                                                 765.000

BAHIA                                  

(Arabica)                              1.600.000                                                                                             1.440.000

(Robusta)                            1.800.000                                                                                             1.800.000

RIO DE JANEIRO               

(Arabica)                              150.000                                                                                 150.000

(Robusta)                            40.000                                                                                   40.000

RONDONIA                         1.500.000                                                                             1.500.000

MATO GROSSO                                 500.000                                                                                 500.000

GOIAS                                   500.000                                                                                 450.000

OTHER ARABICA               200.000                                                                                 200.000

OTHER CONILLON            800.000                                                                                 800.000

TOTAL                                   53.700.000                                                                           45.784.000

ARABICA                              36.260.000                                                                           28.344.000

CONILON                             17.440.000                                                                           17.440.000

 

CARRY OVER STOCKS

Crop 13/14: 53.290.000

Carry 01/07/13: 9.840.928

Beginning Stocks: 63.130.928

Total exports: 33.971.000

Internal Consumption: 21.000.000

Carry 01/07/14: 8.159.928

 

2015 / 2016 PROSPECTS

• Jan/Jun 2013 – accumulated rainfalls circa 1050 mm

• Jan/Jun 2014 – accumulated rainfalls circa 470 mm

• Right now, they are witnessing plantations which were fully loaded, simply falling apart and losing most of its leaves. On those, normally TerraForte would expect a downturn of maximum 25% due to cycle. The way things are going, we basically cannot count on them.

• Pruned plantations which should make up for the loaded ones are showing a 20% loss in vegetative growth, depending on the region sometimes 40%.

• Surprisingly they detected a higher incidence of leaf rust. It is unusual for this time of the year, especially because normally it occurs during the wet season. Maybe due to extreme stress plantations are going through.

• TerraForte definitely won´t give any estimate on numbers for 15/16. Based on their track record, they forecast a very strong flowering due to the extreme stress of the plantations, which might mislead the market again when wonderful pictures of the flowering start circulating.

• Considering all facts above, they believe a huge percentage of abortion will take place.

• What is clear is prospects aren´t good and we would need an extreme change in weather pattern to avoid further disruption.