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This past year it earned $2.4 billion on sales of $15.5 million 132 pound bags as against $980 million in 1975. Its usual export quantity is 18 million to 19 million bags.
The government has several objectives in its juggling of the reserves on hand. They are:
To insure that the world price of coffee remains high
To keep exports at moderately high levels
To keep enough for the large internal market so that Brazilians can continue to get their customary [WORD ILLEGIBLE] (small cups of thick coffee) at reasonable prices.
Private traders here believe the government will be able to pull it off. "I don't think the coffee boycott in the United States will accomplish anything," a leading Rio coffee broker said.
"Coffee drinking is an ingrained habit. You can increase the price of coffee by 50 per cent. You can double it. Yet I still think the average American who is accustomed by starting his day off with a cup of coffee will pay whatever it costs."
The reason coffee prices have soared according to industry expert here, is an unusual combination of events that cut down the output of the leading producing countries. These include a devastating frost in 1975 throughout the coffee belt of southern Brazil, earthquakes that destroyed much of the crop in Central America and political unrest in the African producing countries of Angola and Ethiopia.
The frost in Brazil will have an impact for several years since it takes four years for a coffee tree to bear fruit. Even those trees that were only damaged by the frost will not recover their full bearing capacity until next year.
Brazil harvested 21 million bags of coffee in 1975. And before the frost the government here was predicting a 1976 harvest of 28 million bags. But the 1976 harvest yielded fewer than 6 million bags. It was one of the worst coffee crops in Brazilian history.
Brazil has traditionally supplied 35 per cent of all the coffee exported in the world. With worldwide exports in recent years totaling around 56 million annually. Brazil consistently provided 18 million bags.