Brazilian coffee growers need government aid and a more favourable exchange rate to increase local currency export earnings, the country's producers' new leader said on Tuesday.
Most of the coffee growers in the world's No 1 producer and exporter are small to medium-sized farmers who are struggling to pay off debts incurred during the world coffee price slump between 2000 and 2004. "It's not much use extending debt repayments if farmers don't have revenue," Gilson Ximenes, new president of the producers National Coffee Council (CNC) told Reuters in a phone interview.
Ximenes, commercial director of the Unicoop farm co-operative in Tres Pontas, south Minas, was appointed last week for a fourth mandate in charge of the powerful CNC producers organisation. He was CNC president between 1995-2001. Ximenes said that many growers are selling coffee below production costs of around 250 reais ($129) per 60-kg bag of Type 6 good quality arabicas. Prices are now around 230 reais.
Producers had been targeting 300 reais per bag in the October-to-April interharvest period and withholding sales. "The country's exchange rate policy suffocates coffee growers. The government must find a way to ease the fall of the dollar," he said.