A CoffeeNetwork report from FCStone has indicated that significant damage to Brazil’s coffee crop will affect output driving September futures prices up 6.1% at one point. Drought in early 2014 followed by problematic rains have hit Minas Gerais, Brazil’s top coffee producing region hard resulting in small beans, malformed beans, or no bean formation at all. With the harvest 70% complete, losses are estimated to be at least 25%, and in southern Minas Gerais some producers are reporting harvests that are down 30% year on year. Coffee trees that were not in production this year because of pruning or resting after heavy production last season did show the vegetative growth to support the bloom and a crop for 2015, however overall indicators point to an even smaller crop for 2015. In some areas, vegetative growth is non-existent or too weak to bear fruit. Unseasonal rains have caused flowering to occur two months early and some trees are dropping flowers. The rains have also caused a proliferation of rust, a fungus which causes coffee tree defoliation and death.
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