Brazil Arabica Coffee Output May Fall 7% in 2012-13

Production of arabica beans in Brazil, the world’s biggest coffee grower, may fall 7 percent in the season starting in July from the previous high-yielding year, according to Sao Paulo-based Archer Consulting.

Output will be 39 million bags in 2012-13, down from 42 million bags in 2010-11, Rodrigo Costa, a coffee market specialist, wrote in a report e-mailed yesterday. Brazil’s coffee harvests are part of a biennial cycle, with a high- yielding season followed by a lower-yielding one. The current 2011-12 harvest falls into the latter category.

Global coffee supplies will outpace demand by 1 million to 2 million bags in 2012-13 as arabica trees in Brazil enter the high-yielding season, according to Marex Spectron Group. That follows an estimated shortage of 6.5 million to 7 million bags in 2011-12, the London-based broker said in a report on March 13. While the 2012-13 season starts in July in Brazil, the harvest in most countries usually begins in October.

“The small surplus will not be sufficient to absorb the deficit that we will have in 2013-14,” Costa wrote in the report, referring to the next low-yielding season in Brazil.

Output of robusta beans in the South American country will rise to 16 million bags in 2012-13 from 14 million bags in 2010-11, Costa said. Minas Gerais is the main arabica-producing state and Espirito Santo the biggest robusta-growing one.

Arabica coffee is grown mainly in Latin America and favored for specialty drinks such as those made by Starbucks Corp. (SBUX) Robusta beans are grown mainly in Asia and parts of Africa and are used in instant drinks and espressos. A bag of coffee weighs 60 kilograms (132 pounds).