Vietnam, the world's top robusta coffee exporter, said on Wednesday its crop output may fall 10 percent short of its forecast of 13 million to 13.5 million 60-kg bags due to adverse weather and higher costs. "As producers go to harvest, they say the crop size may be 10 percent less than our estimate," Van Thanh Huy, chairman of the Vietnam Coffee and Cocoa Association (Vicofa), told Reuters.
Huy said on the sidelines of an international coffee conference in Ho Chi Minh City that Vicofa was maintaining its estimate as a precise output figure would be clearer in 2 weeks, when harvesting reaches its peak.
Traders, who say Vicofa underestimates the harvest, had been expecting the crop would reach 1 million tonnes (16.7 million bags), but are now worried it will be lower.
"We have been to the region and we saw the crop is not that big. It may be around 800,000 tonnes," a trader said. The crop for the past year to September was estimated at 850,000 tonnes.
Huy said higher prices for fertiliser, fuel used for irrigation and labour together with dry weather have hit the crop yield. A kg of fertiliser has risen to 4,300 dong (27 cents) this year from 3,300 dong last year, he said.
Fertiliser and watering account for the bulk of Vietnam's coffee production costs. The agriculture ministry estimated the cost per kg of beans at 5,600 dong. Huy cited a recent estimate by the agriculture department in Daklak, Vietnam's key coffee growing province, which put the output decline in the province at between 20 and 30 percent.
Daklak produces about 40 percent of Vietnam's total. "But on the other hand, there are areas with trees planted in the late 1990s which are now providing higher yields.