Cuban Coffee Farms Damaged by Hurricane Sandy

Oct 30, 2012 07:19 AM EDT | By Sharon Robinson

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Coffee crops in Cuba have suffered extensive damage from Hurricane Sandy. The price of Arabica coffee futures have risen. (Photo :

Hurricane Sandy has, reportedly, decimated coffee crops in Cuba, before moving on to the East coast of the U.S. Reports say that over 20 to 30 percent of the coffee farms have been destroyed, along with processing centers and roads.

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According to Reuters, forecasts for the coffee production were 5,300 tonnes of semi-processed beans. This prediction was already far below the previous season's 7,100 tonnes. But now, Reuters predicts that the output is likely to be even lower, at a figure below 4,000 tonnes.

The Sierra Maestra Mountains, where 92 percent of the coffee crops are grown, suffered from the heaviest damage.

Further, the official Granma newspaper reported that Guantanamo province, the country's second producer after Santiago de Cuba, "lost 174,475 cans of beans" and "47 processing centers were damaged," reports Reuters. One tonne equals 525 cans of coffee.

Severe damage to crop fields in the eastern provinces of Granma and Holguin, the country's third and fourth largest producing provinces respectively, has also been reported.

Raul Castro, the Cuban President, has been making efforts to improve the agriculture sector of the country. Millions of dollars have been spent on replanting most of the country's 74,000 hectares of plantations, which have been neglected for decades. Plenty has also been spent on improving processing facilities, and several farming equipment will be imported from Brazil soon.

The damage to the crops in Cuba and to storage facilities in the Eastern Coast of the U.S. has given rise to the price of Arabica coffee futures, which closed up 2.5 percent at 161.65 cents a pound for December delivery, reports Reuters.

Moreover, Brazilian farmers refusing to enter the market, and holding out for a higher price, has also lent to the rise in prices.

"It's the tightness of supply, the fact there are no beans available because Brazilian farmers are not interested in selling at around 1.50. It prompts commercial users to enter at these levels," said Keith Flury, a Rabobank analyst to Reuters. Speculating over the availability of coffee Arabica is also cited as a major reason for the climb in prices of the same.

Robusta coffee futures, on the other hand, have fallen to a seven week low, thanks to excellent output in Vietnam, the top producer, reports Reuters.

Robusta coffee futures, for January delivery, have dropped down $6 to settle at $2,015 per tonne. It was going for $1,987 earlier in the session, adds Reuters.



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