US officials have raised the bar on estimates for coffee output in Brazil, the world's biggest producer, saying it is poised to jump 23% and trounce the previous record.

Many forecasters have cast doubt on Brazil's official forecasts for the 2010-11 crop of 47.04m bags, shy of the record 48.48m bags set eight years ago.

Separately on Tuesday, CoffeeNetwork, the analysis group, pegged output at 49m tonnes.

Last week, Nestor Osorio, the head of the International Coffee Organisation, said that the crop could hit 50m tonnes while FO Licht, the German analysis group, has pegged output at 52m tonnes.

However, US Department of Agriculture staff in Sao Paolo have trumped them all by forecasting a 55.3m-bag harvest, an increase of 8.8m tonne on 2009-10, a rise comprising in the main increased production of arabica beans.

'Favourable bloomings'

The output hopes reflected in the main the biennial production cycle of arabica plants turning to an "on" year.

In addition, heavy rains stretching from midway through last year to March in arabica-growing areas had "promoted several favourable bloomings… as well as good fruit setting and development of the cherries".

Output of robusta beans was set to rise by 14% to 13.5m bags, despite below-average rainfall in Espirito Santo holding back the state's production potential.

Vital signs

The USDA office's upbeat hopes was also reflected in its estimates for 2009-10, which pegged Brazil's total coffee output at 44.8m bags, compared with the 39.5m-bag figure from Brazil's state crop bureau, Conab, which has a reputation for conservative forecasts.

The USDA staff said their estimate was supported by the "dynamics of the Brazilian coffee market… [which demonstrate] strong exports, higher domestic consumption and indications of steady decrease in coffee stocks".

Indeed, they forecast Brazilian coffee stocks near-doubling over 2010-11 to 7.3m bags.

However, they acknowledged widely-held concerns for the quality of the crop thanks to a potential knock-on effect of the succession of bloomings last year in prompting a variety of ripening times and making plantations difficult to harvest. 

Return to surplus

CoffeeNetwork's forecast came as it unveiled forecasts of a rise to a record 139.8m bags in world coffee output in 2010-11, led by Brazilian growth.

With consumption rising by a modest 1.7% to 132.5m tonnes, the output increase would return the world to a coffee surplus, after a deficit of 1.9m bags in 2009-10.

"The world coffee market is facing a possible moderate production surplus," CoffeeNetwork said

This means a continuation of the recent pattern of a global output surplus one year followed by a global output deficit the next."

'Rallies may struggle'

Arabica beans for July delivery closed up 1.3% at 134.25 cents a pound in New York, on a positive day for many commodities after a weak start by the dollar.

July robusta beans ended 1.3% higher at $1,369 a tonne in London.

However, Ralph Hawes at Sucden Financial urged caution, given the CoffeeNetwork and USDA bureau forecasts.