By Alberto Fajardo
TELA, Honduras (Reuters) - Tropical Storm Matthew lashed Central America's Atlantic coast with rain and wind on Saturday, largely sparing Honduras and taking aim at Guatemala and threatening floods and damage to sugar crops.
High winds and heavy rain soaked Honduran tourist resorts along the Caribbean coast and hundreds of people spent the night in government-run shelters but were relieved the fast-moving storm left towns unscathed.
"The storm looked really dangerous and the rains were heavy, but in the end it passed without doing much," said Juan Angel Delgado, a retired resident of the tourist town of Tela.
Matthew hit Nicaragua's Atlantic coast on Friday afternoon, powered along the Honduran coast and looked set to churn into Belize and northern Guatemala over the weekend.
But the storm seemed to lose force, with maximum sustained winds decreasing to near 40 mph (65 kph) Saturday morning. Matthew was forecast to become a tropical depression later in the day, the U.S. National Hurricane Centre said.
The Miami-based centre still warned of torrential rains. "These rains could produce life threatening flash floods and mud slides," it said.
This year's active hurricane season has already battered Central America. Rain from Matthew could delay coffee and sugar harvests. Cane fields have been flooded and coffee trees risk disease and fungus from too much moisture.
Sugar losses could be serious because cane fields are still flooded from earlier rains. Central America produced 4.43 million tonnes of sugar in the 2009/10 harvest and was hoping for a larger crop this year.
Matthew's rains, if they last for days, could start affecting coffee in Guatemala, exporters and producers said.
More than 260 people have died in Guatemala so far this year in mudslides and flash floods.
In 1998, Hurricane Mitch tore through Central America killing more than 11,000 people in devastating floods. It was the second most deadly storm on record.
Matthew is seen eventually dying out over the Mexican state of Chiapas but could dump rain on oil-producing areas of the southern Gulf of Mexico, potentially forcing brief closures of Mexican ports.
On the other side of the Atlantic, Hurricane Lisa, the seventh of the season, weakened to a tropical storm on Saturday, northwest of the Cape Verde Islands and posed no immediate threat to land or oil assets.
(Additional reporting by Gustavo Palencia in Tegucigalpa and Tom Brown in Miami; Writing by Robin Emmott; Editing by Paul Simao)
