July frosts reduce Brazil wheat, coffee output

August 18, 2013

Late-July frosts that fell on Brazil’s south caused significant losses to this season’s wheat and next year’s coffee crops, the farm secretary of Parana said on Wednesday. Parana, one of Brazil’s top two wheat-producing states, will lose 33 percent of its current wheat crop that is maturing in the field, bringing current expected output to 1.9 million tonnes, farm secretary’s statistics co-ordinator Carlos Winckler Godinho told Reuters. Parana is a minor coffee-growing state.

Brazil is likely to expand its 2-million-tonne, import-duty-free wheat quota that will mean local flour mills will buy even more North American wheat this season as leading foreign supplier Argentina grapples with its own tight supplies of the grain. Kansas Board of Trade hard red winter wheat futures for September traded down slightly at $6.95/bushel shortly after an announcement of the Parana state losses.

A new cold front that is likely to create frost again over Brazil’s southern wheat crop was settling in over Parana on Wednesday, with temperatures likely to drop near freezing early Thursday morning. That could cause more losses to the crop. Godinho also said that 62 percent of next year’s coffee crop would be lost due to the frosts that hit the state’s farms in late July. That is roughly equivalent to 1 million 60-kg bags of potential from next year’s crop. He said output is now seen at 582,000 bags from the state, down from 1.54 million previously.

The state’s current coffee crop, now being harvested, is largely unaffected by the frosts and was still forecast at 1.7 million bags. Parana accounts for 3.5 percent of Brazil’s total coffee output, which is forecast at 48.6 million bags this season. Brazil’s overall coffee output is expected to swing upward again next season, as trees make their biennial shift to high from low production. Last season, which was also a high-output year, the coffee belt produced nearly 51 million bags.

Forecasts for the next coffee crop from market and government sources are not common until after flowering, which is just starting in some isolated areas. But if the output potential is close to last year’s coffee harvest, a loss of 1 million bags to Parana’s crop would be a 2 percent decline in potential output from the next crop. Courtesy Reuters

Published in ZaraiMedia.com

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