Coffee output climbing as rains spur bean growth

Coffee production in India, the third-largest grower in Asia, will probably rebound from the first decline in six years after plentiful rains spurred bean development, an exporters’ group said. Shares of exporters gained in Mumbai, while coffee prices dropped.

The harvest in the 12 months starting Oct 1 is set to expand from 300,000 tonne this year, Ramesh Rajah, president of the Coffee Exporters Association, said without providing an estimate. While he expects an increase, the crop still faces the risk of pest attacks and reduced rainfall from a possible El Nino later this year.

Higher production may boost shipments, expanding global supplies and potentially pressuring prices. Arabica futures in New York entered a bear market this month and have tumbled 20 percent from a two-year high in April after rains eased drought damage for plants in Brazil. Robusta prices in London fell 11 percent from the highest level in 17 months in March.

“The prospects seem much better next year, specially for robusta, because rains have been quite favourable,” Nishant Gurjer, a member and past chairman of the Karnataka Planters Association, said.