First report 2016 and Carry Over

Dear Sirs,
With the end of the rainy season and with the performance results of the crops, we feel more confident to share our first balance of the 16/17 crop, as well as the last revision of the 15/16 crop.

Yet there is little doubt about the income, the rainy weather during the crop and the anticipation of the harvest, but we can almost guarantee that the numbers reached a reasonable consensus among the Market operators. Apart from the Conilon, that still has some different approach concerning the numbers.

We consider that the rainy weather and the consequent flowering, evolved from reasonable to good in almost all the coffee-growing areas, mainly in the arabic region. The biggest problem was in Espirito Santo, where the region not only suffered with lack of rain, but also have the irrigation permission suspended. The situation has improved since December, but it was already late for the recover of the plantations.

We also hope that finally the percentage of Arabica higher screens on the crop 16/17 return to historical levels or even above average.

It is possible that, depending on the end of the rainy season, the arabic crop would be anticipated.

The internal Market moves slowly, with some reduction in business trades. The strongest producers are keeping the storage of coffee, waiting for the best opportunity to negotiate for a better price.
You will also find some carry over numbers of the end of 2015 and the forecast for the 15/16 crop, in June, 30, 2016.
We can predict that it will be an inter-harvest period with a limited supply of product for the internal Market. The carry over number presents a prediction of 159,000 sacks, a very low number, that can be explained by the anticipation of the 16/17 crop, mainly from Conilon, that will be in the Market by April. Even so, there is the prevision of a strong reduction in the shipments in the first semester of the year.

Find enclosed files.

Good business to all of you.

Mauricio di Cunto and Renata Hazan

See Spreadsheet: Crop 16-17

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