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Featuring the latest news on the coffee industry and business insight from senior members of the Bennetts team.

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The widely reported El Nino phenomenon has prompted a wave of dry weather across Central and South America.

In Central America, it seems the dry spells have not caused major concern to prospects for the now maturing new crop, with some of the lower grown regions close, or beginning, to harvest.  Aside from the positive forecasts out of Honduras predicting an approximate 9 to 10 percent larger new crop for this new October to March harvest, all the regional producers with the exception of El Salvador are indicating modestly larger new season crops.

Costa Rica experienced a below average rainy season, however the region has had a considerably wetter September and October. The recent rainfall is not cause for concern regarding the upcoming crop, however there is some uncertainty in the West and Central Valley regions due to the earlier dry spells. The Tarrazu region is faring fine .

Guatemala’s harvest has started in the lower altitude regions for extra prime washed and prime washed. Harvest of the main crop and SHB’s will begin in December. Widespread concern over the lack of rain was eased earlier this month with the arrival of a large volume of rain. The downpour was so substantial that it caused landslides in certain producing areas. Both the quality and quantity of Guatemala’s new crop are predicted to be strong.

In South America, a severe drought earlier this year in Espirito Santo state - which is the main producer of conillon, the local variety of Robusta coffee - has lowered production volume to 10.8 million 60kg bags, according to the Agriculture Ministry. This is a significant reduction from the approximate 13 million bags produced the year before. Brazilian consumers are expected to drink more Arabica in their coffee as a result of the sharp decline, according to local industry association ABIC, as roasters struggle with internal Robusta supply.

In Colombia, the spate of dry weather caused by El Nino could prompt changes to the origins export regulations. Currently Colombia only allows producers to sell sacks of coffee containing pasilla - seconds or inferior quality beans - for domestic consumption. The origin is currently studying changes to the regulations that could lead to a lift of export restrictions in an attempt to counter the effects of drought on output and revenue. Farmers are allowed to sell their coffee with no more than 5 percent of pasilla. That could be increased to 10 percent, Roberto Velez, head of the Coffee Federation said. And if drought means there is considerable volume of such beans, the federation could consider exporting them, he said.  

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