Coffee exports down 33% in fourth quarter

The country's coffee exports in January-March fell 33 per cent to 31,317 tonne, compared with the same period a year ago, according to data from Coffee Board of India.

The slide in exports was attributed to the volatility in overseas markets, which deterred exporters from entering into new deals, industry officials said.

India exports around 80 per cent of the coffee produced. The country closely tracks the overseas markets for price trends. Overseas prices in the last three months have displayed wild price swings owing to huge unwinding of positions by hedge funds and rates have swayed between $1.12 and $1.10 a pound.

Arabica coffee exports fell 58 per cent in January-March, while fall in robusta coffee exports during the same period was 29 per cent, compared with a year ago, the data indicated. 
 

CUP OF WOES Coffee export in tonne.
Varieties	January-March
	2007	2006
Arabica Parchment	5,578	17,257
Arabica Cherry	3,193	3,831
Robusta Parchment	2,114	3,687
Robusta Cherry	13,465	18,487
Instant coffee	6,967	3,262
Note: Coffee is of two types"�washed called parchment and unwashed known as cherry Source: Coffee Board of India

Instant coffee exports, however, registered a rise of 113 per cent due to good demand, they said. Arabica coffee exports fell due to low output in the year ended September, which led to hoarding by farmers, dealers said.

Dealers said 2006-07 (October-September) arabica coffee output is likely to fall due to the white-stem borer disease.

In the year to September, the country is likely to produce 99,700 tonne arabica coffee, compared with an initial estimate of 103,700 tonne released by the Coffee Board in July.

However, despite a poor performance in the first quarter of the calendar year, industry officials and traders are optimistic that exports will improve during April-July.

"Research suggests that global prices would improve in the second quarter largely because Brazil's exports would ease and there would be a supply constraint since the country is expected to harvest a lower crop in the new season," said Anil Kumar Bhandari, former chairman, United Planters Association of India.

The South American country's output in 2007-08 is estimated at 32 million bags (1 bag=60 kg), down from 44-45 million bags previous year.

Brazil is the largest producer of Arabica. Harvest in the country will begin in June. Exporters also expect Indian growers to release the stock by May, hence creating more availability.

"By May, rains will begin in most parts of southern India. Farmers have no other choice but to release the stock in order to avoid any damage," a senior official at one of the country's leading exporting firms based in Bangalore said.

Good quality and reasonably fair price levels with Vietnam aided a rise in the exports of instant coffee, he said. Coffee Board allows export of Plantation PB, Plantation A, and Plantation Black varieties among others in the arabica grade.

Robusta coffee exports comprise varieties such as Plantation Bits, Plantation Bulk, and Cherry Brown.