El Ni ñ o could hit Indonesia's coffee industry the hardest in five years

According to Bloomberg, May 10, El Ni ñ o could lead to a 10% drop in coffee production in Indonesia this year, the worst El Ni ñ o in nearly two decades, leading to a dry climate, crop damage and delayed harvest.

Some farmers, the world's third-largest grower of robastian coffee, may harvest 570000 metric tons of beans in the season that begins in April, according to a median compiled by Bloomberg based on the estimates of five traders. That's down from the previous year's record of 636300 metric tons. This will be the sharpest decline since 2011 and 2012, according to USDA data.

The decline in Robastian coffee production in Indonesia will reduce its supply to Nestl é, which will lead to a rebound in futures in London this year. The Indonesian Bureau of Meteorology, Climate and Geophysics said the worst El Ni ñ o since 1997 and 1998 was the main cause of drought in the southern part of Sumatra, the country's main coffee producing area last year.