Brazilian market should gain pace this month

Harvesting activities for arabica coffee are completed in several areas of Brazil. Crop production should totalize 32 million bags this year, according to the National Company for Food Supply (Conab).

The robusta crop production (2006/07), already harvested, is forecast at 9.5 million bags of 60 kilos.

For now, it has been raining in good volumes in Brazil. Anyway, growers need higher soil moisture to start crop care activities. Moisture is also important to stimulate a new flowering.

The CEPEA/ESALQ Index for arabica (type 6) averaged 109.53 dollars per bag of 60 kilos on Sep 29, up only 0.8 percent in the month. For robusta (type 6), the Index averaged 85.77 dollars per bag of 60 kilos, up 3.65 percent in the month.

In the international market, players bet on higher prices in the end of this year, due to the lower supply in Brazil (off-season period) and the projection of a inferior production next year (biannual cycle). Besides that, the demand by toasters industry in the North Hemisphere should increase in the winter season.

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