The International Coffee Organisation further dropped its estimates for the 2012-13 production year to 144.1 million bags, in their latest coffee report released this month. In November 2012, the ICO had initially estimated production levels to hit a record 147 million bags. That number was revised to 146 million bags in December, and lowered by another 1.9 million bags in this latest report. “Some countries in Central America have been affected by adverse weather as well as coffee pest and diseases, in particular coffee leaf rust and coffee berry borer, which could have an impact on production levels going forward,” the ICO stated, also noting that India has reduced its post-monsoon estimate to 5.3 million bags. The figure nevertheless represents an increase of 7.2 per cent over the 2011-12 crop year, which will be needed to meet buoyant consumption. The ICO noted demand is particularly strong in emerging markets and exporting countries. Opening stocks in exporting countries are estimated at just 15.1 million bags, the lowest level ever recorded. Lowered production estimates follow downward movements in coffee prices, with the monthly average of the ICO composite indicator price falling by 3.7 per cent to 131.31 US cents per pound in December 2012. The ICO noted that this brings the average price for 2012 to 156.34 US cents per pounds, 25.7 per cent lower than a year ago. As prices in 2011 were at unprecedented highs, the 2012 average is still higher than any other year in the last decade, although the ICO noted that “costs of production may have increased over time.” Price falls were said to be particularly pronounced in the three Arabica groups, with Robustas recording a smaller decrease of 1.1 per cent compared to November.