Brazil Could See Stronger Winter Cold Fronts In Coffee Regions

SAO PAULO (Dow Jones)–Brazil could see stronger cold fronts coming from the south this winter as the regional climatic pattern moves into a new cycle, meaning a somewhat increased risk of frost in the southeastern coffee regions.

Frost is rare in the arabica-producing belt of southern Minas Gerais state and neighboring Sao Paulo state, where around 40% of Brazil’s coffee is grown. But it’s devastating for sensitive coffee plants and can wreak havoc in even more sensitive international coffee markets, given Brazil’s position as the No. 1 global producer of java.

Olivia Nunes, a meteorologist at Somar Meteorologia, said southeastern Brazil said temperatures could remain low this year because the atmosphere is entering a neutral phase of the El Nino-La Nina climate cycle. The most recent La Nina ended around April, and so cold fronts sweeping north from Antarctica are more likely to penetrate inland to the coffee country, rather than be pushed east over the Atlantic Ocean.

“This makes cold waves more intense during the winter over the center and south of the country, especially in July and August,” Nunes said. “In a neutral year, the risk of frost in coffee regions is high and requires monitoring.”

Rainfall should be normal for the southeastern Brazilian winter, which is drier than summers and provides good conditions for coffee beans to dry. For frost to occur, Nunes said, there must be little wind and minimal cloud cover.

A cold front passing over southeastern Brazil early this week has made for some chilly mornings in the city of Sao Paulo, with temperatures dipping into the upper 40s. Inmet, the National Meteorology Institute, posted frost warnings for mountainous areas of Sao Paulo state and southern Minas Gerais state, though Nunes said there was no risk yet to the lower-elevation coffee farms.

“We can’t yet say when these fronts will come with greater intensity,” she said. “There’s the possibility, but it’s risky to say now whether they’ll be strong frosts or just isolated ones.”

A meteorologist at Inmet in Sao Paulo also said this winter’s cold fronts may be more intense than in previous years, added that temperatures are likely to be more volatile.

Traders in Brazil are accustomed to keeping an eye on the weather, after deep freezes in 1975 and 1994 sent coffee prices soaring.

John Wolthers, of Santos-based exporter Comexim, said he hasn’t heard anything in particular to suggest a dangerous winter, though a freeze could be disastrous, as Brazil’s coffee plants are in the second, low-output year of their two-year production cycle.

“Obviously, people are very worried because if anything happens at all this year, it’s the worst year ever,” Wolthers said. Global prices are already high, before the outcome of Brazil’s crop for the year has become clear, so any trouble could lead to even higher prices.

The Agriculture Ministry’s Conab agency forecasts Brazil will harvest 43.5 million 60-kilogram bags of beans this year, compared with 48.1 million bags in 2010.

Gustavo Moretti, a trader at Interagricola, also in Santos, said that while the risk of frost always exists, the forecasts he’s seen don’t suggest a very dangerous year. “Overall, we aren’t doing crazy hedging positions or anything,” he said.

-By Paul Kiernan, Dow Jones Newswires