Rabobank added coffee to the list of crops for which export supplies stand to be squeezed by Brazil's logistical bottlenecks, as the line-up of ships waiting to load at the port of Paranagua passed 100.
The bank, restating a forecast of New York arabica coffee futures averaging 160 cents a pound at the last quarter of the year, 13% more than the December contract is pricing in, named Brazil's infrastructure hiccups among reasons to expect a rally.
"Logistical constraints will likely hamper Brazil's ability to export coffee and is supportive of prices as the country contends with striking port workers and large grain and sugar crops," the bank said.
The comments came as it was revealed that the number of ships waiting at Paranagua, Brazil's second largest port, which handles some coffee as well as the likes of corn and soybeans, had reached 100, and with more boats on their way.
While Brazil, whose crop exports begin to ramp up from February-March with soybean and main-crop corn harvests, has a history of port hold-ups, the queue of ships did not reach 100 last year until June.
'Very long waiting times'
"The port has not added any additional loading capacity over the past year, so it has resulted in very long waiting times," Michael Cordonnier, at Soybean and Corn Advisor, said.
And the congestion "is not expected to abate any time soon due to volume of grain that needs to be exported", with a record Brazilian soybean harvest in train and huge import demand, following a disappointing US harvest last year.
Rabobank forecasts for New York arabica and London robusta prices
Q1 2013: 144 cents a pound, $2,060 a tonne
Q2 2013: 155 cents a pound, $2,150 a tonne
Q3 2013: 165 cents a pound, $2,150 a tonne
Q4 2013: 165 cents a pound, $2,150 a tonne
Prices for quarter average, front month contracts
For soybeans, "the three public berths at the Port of Paranagua can load 65,000 tonnes a day and at that rate, it will take a minimum of 50 days just to load the vessels waiting in the harbour," Dr Cordonnier said.
"The waiting period could be even longer if wet weather delays the loading operations."
'Potentially lasting consequences'
Rabobank also cited the impact of roya fungus in Central American coffee plantations as a supportive factor, forecasting falls of 4% in output in 2012-13 and 14% next season, when production will be 3.3m bags lower than in 2011-12, before the epidemic.
"The worst case of roya in Central America and Mexico since 1976 is expected to reduce production by 18% over two seasons, bringing upside price risks and potentially lasting consequences for the industry," the bank said.
Furthermore, arabica prices will be supported by buoyant values of robusta, the coffee variety grown largely in Asia, for which the bank nudged higher its price forecasts cautioning over a threat to output in Vietnam, the largest producing country, from drought.
However, it sounded a note of caution over arabica values in future seasons, saying that output from plantation expansion encouraged by the rally in 2010 and early 2011 "may pressure prices after 2013-14" when trees mature.
Separately, Societe Generale sounded a bullish note on arabica prices over the rest of 2013.