The global coffee market may be in deficit of 11 million bags, or 1.45 billion pounds, next season as producing countries fail to compensate for output cuts from Brazil, the world's biggest producer, the International Coffee Organization said.In December, Brazil's forecasting agency Conab estimated a cut of as much as 27 percent in output for the country's 2007-2008 season as its coffee trees enter the low-production year of a 2-year growth cycle. The ICO said Monday in a report that it expects global production to be 109 million to 112 million bags, of which Brazil will account for 29 percent. Demand is forecast to be 118 million to 120 million bags.
Robusta coffee futures for March were unchanged at $1,546 a metric ton on London's Euronext.liffe. Prices have gained 20 percent in the past year on shortages of supply from Vietnam, the world's biggest robusta grower, which had its last harvest cut by drought.
The country forecasts its crop this season to increase by a fifth, to as much as 15 million bags, according to the Vietnam Coffee and Cocoa Association.
Arabica coffee futures on the New York Board of Trade closed at $1.2030 a pound on Jan. 12. The New York market was closed Monday for the Martin Luther King Jr. holiday. Prices have gained 28 percent since last year's low of $0.9405 in July.
Source: twincities.com
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