Felix looms over Central America coffee crops

By Brian Harris

MANAGUA (Reuters) - Pounding rain from Hurricane Felix could hurt Nicaragua's coffee crop, but was seen largely sparing plantations in Honduras and Guatemala, exporter and grower associations said on Tuesday.

Hurricanes can wreak havoc with Central America's valued coffee crop, and coffee prices surged in London and New York on speculative buying as Felix made landfall in Nicaragua as a potentially devastating Category 5 storm.

Felix, which later slowed to a Category 1 storm, was not forecast to directly hit Nicaragua's coffee crops, but growers were concerned about heavy rainfall, EXCAN General Manager Conny Perez said.

"It depends how much water falls, but if there's a lot, it could cause damage," Perez told Reuters at the RAMACAFE industry meeting in the Nicaraguan capital.

EXCAN groups large private coffee exporters and is responsible for 80 percent of Nicaragua's coffee exports.

Farmers at the RAMACAFE meeting said it was too early in the crop cycle for rain to overload cherries with water and force them off trees but hard rain could still hurt the crop.

The full extent of damage may not be known until harvesting starts in November, when defective beans are detected in processing. Damage to the root systems of coffee trees and erosion of nutrients from the soil will take longer to spot.

Walter Navas, executive director of Nicaragua's National Coffee Council, was more pessimistic, saying up to half the expected 2007/08 crop of 1.5 million 60 kg bags could be hit.