Posted date: 02/03/16

SAO PAULO, Feb 29 (Reuters) – Brazil’s 2016/2017 coffee crop is seen at 56.25 million 60-kg bags, up 13 percent from the 49.9 million bags harvested from last year’s drought-hit crop, trader Comexim said on Monday.

Arabica beans are expected to make up 44.35 million bags of total output and robusta 11.9 million, as the return of rains to arabica-growing regions are expected to improve trees’ output.

“We expect the supply of bigger beans to return to normal levels,” said lead trader Mauricio Pires Di Cunto. “Currently, there is a 30 U.S. cent per bag premium on the 16/17 screens and larger over the smaller beans, but we expect that to fall.”

Comexim said coffee stocks are expected to fall to 159,774 bags on June 30 when the crop year officially ends, their lowest levels in recent history. Brazil had just over 10.6 million bags of carry-over stocks at the end of June 2015, Comexim said previously.

Stocks totaled 25.56 million bags on Jan. 1, 2016.

Drought over the past two years in major coffee production regions has eaten into output in the world’s largest exporter of the commodity.

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