Coffee output in Central
America and Mexico may tumble as a disease affecting foliage spreads, prompting
governments to take emergency measures to protect farms responsible for 14
percent of global production.
In Costa Rica, Vice President Luis
Liberman and Minister of Agriculture and Livestock Gloria Abraham on Wednesday
signed an emergency decree to combat a highly destructive fungus known as
“roya,” which has devastated coffee crops, particularly in the southern region
of Costa Rica.
Coffee leaf rust threatens production in
Central America
By Andres
R. Martinez, Andrew
J. Barden & Adam
Williams
January
24, 2013
Coffee output in Central America and Mexico may tumble as a
disease affecting foliage spreads, prompting governments to take emergency
measures to protect farms responsible for 14 percent of global production.
Guatemala, Central America’s second-biggest coffee grower, may
lose a third of its crop because of leaf rust, President Otto Perez Molina said
yesterday in Davos, Switzerland. The crop in Costa Rica may be 30 percent to 40
percent smaller because of the fungus, President Laura Chinchilla said in a
separate interview in Davos. Coffee exports from Honduras, the region’s biggest
grower, will be down 767,000 bags due to leaf rust, also called roya, the
Honduras Coffee Institute said.
Coffee production in Mexico and Central America will be 19.7
million bags in the 2012-13 season that started Oct. 1, the International
Coffee Organization estimated in a report on Jan. 9. That is 2.8 percent lower
than the previous forecast of 20.3 million bags, data from the London-based
group showed. Farmers around the world will harvest 144.1 million bags, the ICO
estimates. A bag of coffee weighs 132 pounds.
“In the next few months when demand increases, the market will
realize that the countries south of Mexico to Peru do not have the amounts of
coffee expected and that there will be less availability of high-quality
coffee,” said Ronald Peters, executive director of the Costa Rican Coffee
Institute, adding that higher temperatures and below normal rainfall may have
helped fuel the outbreak.
Coffee Futures
Arabica coffee futures traded
on ICE Futures U.S. in New York declined 37 percent last year, the most in more
than a decade, partly because of a bigger crop in Brazil, the world’s largest
grower, and rising stockpiles. The beans favored by Starbucks Corp. (SBUX) were
the worst performing commodity in the Standard & Poor’s GSCI gauge of 24
raw materials last year. Prices are up 1.9 percent this year.
“The
roya situation and the potential that next season’s crops may be impacted is
certainly a current focus of the market,” Keith Flury, an analyst at Rabobank
International in London, said by e-mail yesterday. “If the Central American
crop is lower this will support coffee prices.”
Guatemala’s government will help growers cope with losses from the
foliage-attacking disease, Perez Molina said. Costa Rica will provide aid to
farmers affected, said Chinchilla. The disease will probably spread throughout
the region as last year’s slump in prices reduced farmers’ income, limiting
their ability to pay for chemicals to treat crops, said Stefan Uhlenbrock, an
analyst at F.O. Licht GmbH in Ratzeburg, Germany.
Government Aid
“The minister of agriculture briefed us at the last meeting and
told us about the impact, which could be very big,” Perez Molina of Guatemala
said. “The government will help farmers, especially small-and medium-sized
ones.”
About 17,000 farmers in El Salvador, or 65 percent of producers,
will receive aid from the government to fight the outbreak, newspaper El Diario
de Hoy reported Jan. 23.
The damage in Costa Rica may be “very high,” Chinchilla said. The
Costa Rican Coffee Institute, known as Icafe, cut the nation’s production
estimate to 1.648 million bags from a previous forecast of 1.714 million bags,
it said on Jan. 4. Some farmers have already lost as much as 20 percent of
their crop, said Peters.
---
To contact the reporters
on this story: Andres R. Martinez in Davos, Switzerland atamartinez28@bloomberg.net; Andrew J. Barden in
Ottawa at barden@bloomberg.net; Adam Williams in San
Jose, Costa Rica at awilliams111@bloomberg.net
To contact the editors
responsible for this story: Claudia Carpenter atccarpenter2@bloomberg.net; James Attwood at jattwood3@bloomberg.net
--
RELATED
Decree helps fight
coffee fungus
Thousands of hectares of Costa Rican coffee
plantations have been damaged by a plant fungus known as “roya.”
By Alberto Font
January
25, 2013
 |
Abnormally warm and dry
climates throughout Central America
have fueled the
spread of a fungus that is destroying coffee crops.
This
week, the Costa Rica government issued an emergency decree
to
help farmers. Photo: Courtesy of Alberto Font, Tico Times
|
Vice President Luis Liberman and
Minister of Agriculture and Livestock Gloria Abraham on Wednesday signed an
emergency decree to combat a highly destructive fungus known as “roya,” which
has devastated coffee crops, particularly in the southern region of Costa Rica.
Roya is caused by the fungus
Hemileia vastatrix, and has destroyed more than 7,000 hectares of coffee in the
Southern Zone canton of Pérez Zeledón, and 3,000 hectares in Coto Brus. It also
has been detected in several other regions throughout the country.
The emergency decree sets in motion
a two-year response plan that can be extended.
The fungus affects coffee leaves and
causes fruit to prematurely fall off the plant. Farmers must completely prune
affected plants to restore their ability to produce. Roya was first detected in
Costa Rica in 1983, but an unusually dry climate has caused roya to become more
widespread.
The decree sets the framework to
allow public and private institutions to provide financial resources and other
assistance to the Plant Health Department, which will distribute aid and
supervise response programs in coordination with the Coffee Institute of Costa
Rica, or ICAFE.
Abraham told The Tico Times that the
decree allows officials to access emergency funds from the Plant Health
Department and ICAFE to finance the purchase of agrochemicals to distribute to
farmers.
She said that a decrease in rainfall
and hotter temperatures caused the fungus to spread more this year than in the
past.
According to Jorge Ramírez, ICAFE’s
technical director, officials will respond to “all of the requests from farmers
in order to protect their harvests.” He said aid packages of fungicides would
be distributed in March or April, as seasonal rains set in.
Officials estimate that up to 50
percent of Costa Rica’s 2013-2014 coffee crop could be affected in regions
hardest hit by roya – about 10 percent of the national harvest.
Pablo Jiménez, owner Café de
Altura de Pérez Zeledón S.A., who lost 15 percent of his crop this year to
roya, told The Tico Times he thinks the problem is manageable.
“It’s certainly true that climate
has favored the spread of the fungus and damaged many crops, but with regular
attention, the problem doesn’t get too much out of hand. The real problem is
that in the Southern Zone, farmers have limited resources, and their crops are
more easily affected.”
He recommended a broad program of
pruning, shade control and constant application of fungicides.
Marvin Barrantes, owner of Café Lila
in Coto Brus, said preventive action helped save most of his crops. However, he
said heavy fungicide use is expensive.
“Farmers who didn’t have the
resources [to respond to roya] throughout the year lost everything. Those of us
whose coffee plantations are in good shape were able to respond because we took
out loans to support our businesses. Small producers don’t have that access to
credit.”
For Barrantes, last year’s coffee
prices were too low to sustain production.
Ramírez, disagreed, saying that
although coffee prices have dropped in the last year, revenue is sufficient to
cover production costs.
“The cost of production ranges
from $92-$100 per fanega [256 kilograms of coffee], which leaves $55 profit per
fanega for producers,” Ramírez said.
According to the daily La Nación,
the fungus also has destroyed at least 1.7 million quintales in Nicaragua,
Honduras and El Salvador (Central American coffee is generally sold in
46-kilogram quintales).
Abraham said that since 2010,
officials have implemented a program to replace aging coffee plants to increase
production. Part of that program is an effort to use plants that are more
resistant to roya, the minister said.