PRINTABLE VERSION   EMAIL TO A FRIEND   RSS FEEDS 13:55 UK, 10th Sept 2012, by James Moore
Weak El Nino could spur Colombia coffee revival

The weak incarnation of El Nino which meterologists increasingly believe is currently rolling out could prove a boon to Colombia's coffee industry,  by boosting production without favouring also a major disease.

Coffee growers in Columbia have struggled in recent years as a result of unfavourable weather, which has encouraged the spread of roya fungus and damaged flowering, and exacerbated a downturn from a replanting programme.

Colombia's output of arabica coffee – of which it is the second largest grower behind Brazil, and the top producer of high quality beans - has fallen below the 50-year average of 11m 60-kg bags for the past four years.

Output dipped below 8m bags last season to the lowest level in three decades

Drier weather

However, a 26% rebound in Colombian coffee output in July was "hinting towards a recovery", Barclays Capital said, echoing comments from the International Coffee Organization.

An "uptrend" which should bring output back to some 8m bags in the 2011-12 marketing year, which ends this month, should "help production recover further next year", BarCap analyst Kate Tang said, flagging the boost from drier weather.

"The dry season began in May, a month earlier than expected.  

"Additionally, recent sunlight has boosted flowerings, which could lead to a greater number of ripe cherries."

How much El Nino…

The onset of an El Nino, which "would reduce the likelihood of torrential rains that has previously hit production hard", could further boost prospects for the recovery– as long as the dryness is not so severe that it encourages a major pest.

"The effect of El Niño depends on its intensity and duration," Ms Tang said.

"Dry weather will help ripen beans, yet too much dryness can create a breeding ground for broca worms, which eat coffee kernels and damage beans."

A strong El Nino in 2009-10 sparking conditions which "created a breeding ground for broca worms, and output fell 7% year on year".

'Weak, short-lived El Nino'

Initial reports suggest weather patterns around the Pacific Rim are showing that an El Niño pattern is edging closer.

However, it is not looking like developing into the moderate event that meteorologists had previously expected.

The New Zealand National Institute of Water and Atmosphere said in its most recent climate outlook: "Borderline El Nino conditions are present in the tropical Pacific, and a weak, short-lived El Nino is predicted for the spring and summer periods."

El Niño is defined by prolonged differences in Pacific Ocean Sea surface temperatures when compared with the average and can have dramatic effects on weather patterns, harvests and fishing. 

Arabica vs robusta

Improving production from Columbian would help reverse a world squeeze which, in helping send arabica prices last year to their highest since 1997, has encouraged a switch to less expensive robusta beans.

The uncertain economic outlook has also prompted a shift to cheaper blends with a higher robusta content. 

Macquarie said last week that "around 5m bags of demand was lost to robusta over 2010-11 and 2011-12" worldwide.

The bank forecast that arabica output will outpace consumption by 2.2m bags in 2012-13, compared with a 0.9m-bag deficit for robusta.

Both are anticipated to post far larger surpluses during 2013-14, Macquarie said.

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