Coffee leaf rust concerns lead to higher Arabica prices: ICO
Coffee prices recovered slightly in January, the International Coffee Organisation reported on 6 February, citing growing concerns about the outbreak of coffee leaf rust across Central America.
According to the monthly coffee report, outbreaks of coffee leaf rust have been reported in all major coffee-producing countries in Central America. The ICO noted that authorities in Costa Rica declared a state of emergency in order to tackle the spread of the fungus. In Guatemala and El Salvador, the ICO said that the rust may have affected 40 – 50 per cent of all coffee plants. Both countries, along with Nicaragua, have enacted programs to help coffee farmers and experts contain the spread.
Honduras declared a phytosanitary emergency in reaction to the outbreaks, and the ICO also noted that leaf rust has been reported in certain parts of Mexico.
"This outbreak could have serious long-term implications for the production of Washed Arabicas in Central America," the ICO stated. "With the region potentially loosing around 2.5 to 3 million bags of coffee."
Prices reacted to the news after months of steady decline, with Colombian Milds, Other Milds and Brazilian Naturals increasing by 2.9 per cent, 3 per cent, and 3.2 per cent respectively.
Total production estimates were also revised accordingly, with the total production for the 2012-13 crop year at 144.5 million bags. While this represents an increased of 7.3 per cent over last year, in November 2012, the ICO had initially estimated production levels to hit a record 147 million bags.