Starbucks to source Tata Coffee beans

Starbucks, one of the leading coffee chains of the world with over 8,500 retail outlets, has entered into an agreement with Tata Coffee for sourcing coffee beans. This is the first time that Starbucks is buying coffee from India.

According to the contours of the arrangement, Starbucks would buy coffee beans at a 40 per cent premium from Tata Coffe.

The company's press release said that Tata Coffee had been in touch with Starbucks for several months since the visit of Colman Cuff, green coffee trader from Starbucks to India and met all criteria from soil, water, pest, waste and energy management, forest and biodiveristy conservation to workers' welafre, wages and benefits, living conditions, health, safety, among others.

Hamid Ashraff, managing director Tata Coffee said, "Starbucks deal with Tata Coffee is yet another significant milestone to show how Indian coffee is gaining acceptance in the international market. Tata Coffee as a company is committed to producing the highest quality coffee under world class standards, which can easily compete with the world's premier coffee growing countries."

Apparently, Starbucks follows a point system while signing suppliers. The points are awarded by Starbucks for economic, social and environment management.

Tata Coffee, it maybe mentioned, is the largest integrated coffee company in Asia with a production of 10 million kg of coffee from 7,000 hectares spread over 26 estates across Chickmagalur, Coorg, Hassan districts in Karnataka.

The company has identified value added form of coffee as its focus area and aims to be the number two player in the branded filter coffee segment by selling its entire production in value added form. The company was endeavouring to tranforming itself into a brand-driven FMCG company.

The Tata Coffee scrip today closed at Rs 166.19 on the National Stock Exchange and Rs 167.05 on the Bombay Stock Exchange.