July 14, 2001

El Salvador's coffee industry reports $157 million in losses

                 SAN SALVADOR, El Salvador (AP) -- Falling coffee prices and harvests
                 lost to a pair of devastating earthquakes have cost El Salvador's coffee
                 industry $157 million in losses since October.

                 This country's struggling coffee farmers produced just 2.3 million 100-pound
                 (46-kilogram) sacks of coffee between October and June, down from the 3.4
                 million sacks they produced over the same period last year, Ricardo Espitia,
                 director of Salvador's Coffee Council, said at a Saturday press conference.

                 The production declines saw El Salvador export just 1.72 million sacks of
                 coffee, valued at $105.85 million -- a decline of almost $263 million from last
                 year's exportation revenues, Espitia said.

                 "This year we have had historically low prices and historically low harvests,"
                 Espitia said.

                 A magnitude-7.6 quake tore through El Salvador Jan. 13, costing the coffee
                 industry $100 million in lost harvests, Espitia said. Another strong tremor
                 rocked the region a month later, destroying an unknown number of other
                 harvests, he said.

                 The international price of coffee keeps setting record lows, falling this week to
                 $90 per sack, Espitia said.

                 In response to the losses, Salvadoran coffee producers will trim their
                 production of low-quality coffee by 5 percent. Overproduction of low-quality
                 coffee in Vietnam and across Southeast Asia may eventually force El Salvador
                 to abandon the low-priced coffee market altogether, he said.

                 El Salvador's top export, coffee employees 135,000 people here, a tally
                 representing one-seventh of this country's workforce.

                   Copyright 2001 The Associated Press.