Dar Es Salaam, Aug 7 - Tanzania's coffee board said on Thursday that it saw output rising to 50,000 tonnes in 2008/09 (May/April) from 41,200 tonnes the previous season.
It earlier forecast 54,000 tonnes.
"In 2008/09 we have made a revision, considering what we have achieved in 2007/08, we don't want to be over optimistic," Leslie Omari, chief executive of the Tanzania Coffee Board (TCB), told Reuters by telephone.
"Unfortunately, 2007/08 was a low-yielding year," Omari said. "Farmers are still rehabilitating their farms."
TCB had forecast production to reach about 53,000 tonnes in 2007/08. The industry regulator made its 54,000 tonnes forecast for 2008/09 earlier this year. In 2006/07, the country produced about 45,000 tonnes of coffee.
Tanzania's coffee sector has recovered from a drought that depressed its 2005/06 crop to less than 35,000 tonnes.
Tanzania grows mostly high quality arabica beans, but it also produces some robusta. Both types thrive in northern, southern and western parts of the country in areas around Mount Kilimanjaro and Lake Victoria.
Smallholder farmers in the east African nation of about 40 million people produce about 80 percent of the coffee.
"GOOD PRICES"
Omari said Tanzania's arabica beans fetched an average price of between $2.20 and $2.50 per kg this season, compared with an average of $2.20 to $2.30 in 2006/07.
Robusta beans fetched an average of $1.60 to $1.70 per kg in 2007/08, compared with less than $1 per kg the previous year.
"The prices were good for the year," Omari said, adding that the sector earned about $90 million in 2007/08, compared with $72 million the season before.
Leading buyers for Tanzanian coffee were Germany, Japan, Italy, the Netherlands and the United States. Omari said the TCB was limiting its marketing campaigns to existing buyers for the time being due to lack of funds to seek new markets.
He said the state-run Tanzania Coffee Research Institute (TaCRI) had met its goal of distributing 500,000 seedlings in 2007/08, but that demand for new trees was still overwhelming.
"According to TaCRI, they have hit the target, but this is a drop in the ocean," Omari said.
"Farmers are still looking for more seedlings."
The TCB aims for Tanzania to produce 120,000 tonnes of beans a year by 2010, with more than half of that being specialty coffee compared with about 20 percent of the crop currently.
Speaking from the northern town of Moshi in the shadow of Mount Kilimanjaro, Omari said Tanzania's weekly coffee auctions would resume there next week after taking a break in March.