Brazil Crop Forecast Update

March 18 (Reuters) – An unprecedented drought reduced 2014 coffee production in Brazil, the world’s biggest grower, and stunted tree branch growth for the upcoming 2015/16 crop.

German coffee trader Neumann forecast in a March report that Brazil will harvest 45.3 million 60-kg bags of coffee in the harvest that will start in May, according to traders who saw the report.

This is up from its August forecast of 45 million bags. In the August report, it said Brazil’s 2014/15 crop was 47.7 million bags.

This is the lowest in a range of estimates gathered from trade houses since late December, with the highest at 49.5 million bags, estimated in February by Volcafe, the closely watched Swiss-based coffee division of commodities house ED&F Man.

Swiss-based trade house Ecom shaved its forecast slightly in a presentation to clients last week, estimating that Brazil would produce about 49 million 60-kg bags, with roughly 32 million arabica and 17 million robusta.

This was down slightly from its December estimate of 50 million bags.