BLOOMBERG – Coffee production in Indonesia, the world's third largest grower of roasta beans favored by instant beverage manufacturers such as Nestle, is expected to climb to its highest level in four years in 2019, increasing global supply and further increasing The costs of caffeine addicts.
Farmers in Southeast Asia could collect 11.5 million bags, or 690,000 tons, in the coming months, according to the median estimate of four traders compiled by Bloomberg.
This is an increase of more than 5% compared to last year, data from the US Department of Agriculture show.
"The weather was supportive" for the development of cherry, Mr. Nuthama Sugandi, chairman of the Indonesian Coffee Manufacturers Association, said in a telephone interview on Wednesday (May 15).
The modest rainfall last year provided enough water for crops to produce quality beans, he said. The harvest began in April and will be a record in June or July, he said.
The Golden Triangle
The provinces of Lampung, Bengkulu and South Sumatra in the south of Sumatra island are the main areas in Robusta, producing about 75 percent of the country's output. Beans from the area are sent from the port of Panjang in Lampung. Variety of arbica grows mainly in North Sumatra and Java.
Farmers in the region known as the Golden Coffee Triangle harvested about 20 percent of their beans, according to Mr. Moelyono Soesilo, owner of PT Sumber Kurnia Alam, a Java-based trader.
Constant imports have cut grade-grade exporters by 5 percent to $ 1,540 ($ 2,115) per tonne this week a month earlier, he said.
Port shipments to Panjang more than doubled to 5,000 tons on Monday from a week earlier as farmers sold beans before the main Islamic festival next year next month.
"The farmers have released fresh beans from the new bag because they need money for Ramadan and Eid al-Fitr," he said, despite the low prices, said Susilo.
Globally abundant supplies have been piling up on world prices, reducing costs for roasters.
Futures traded in New York fell to 88 cents a month, the lowest since 2005, while Robusta futures in London fell to $ 1,290 a ton, the weakest in nine years.