The recession-hit coffee industry will show signs of a revival only from December this year when the new crop arrives in the market, said G V Krishna Rau, chairman, Coffee Board of India. Speaking to Business Standard on the sidelines of an event to announce the India International Coffee Festival 2009, Rau said, exports will continue to be low in the next few months, registering a drop of 20 per cent over last year.
During the last coffee season (October 2007 - September 2008) India exported 220,030 tonnes. This time, till August 11, exports stood at 138,044 tonnes. With just another month to go for the present coffee year to conclude, it has become increasingly clear that exports will fall 20-25 per cent compared to last year. “Demand from the Russian Federation and European countries has fallen due to economic slowdown in the last few months. However, the chief reason for downfall of coffee exports from India is the reduction in output back home,” said Rau.
Low coffee output in India has been responsible for low export volumes and high prices. There was a heavy crop loss in the biggest coffee producer of Karnataka due to excessive rains last year and berry borer menace. It is estimated by the Coffee Board that by the end of the present coffee year, India’s coffee output would be 262,300 tonnes, which is 10 per cent lower than initial estimates.
Normally, India exports about 75 per cent of the coffee produced. Hence, the adverse impact on exports has hit the industry in a big way. However, both exporters and the Coffee Board are hopeful about the next crop year starting October which looks promising with an output forecast of 306,300 tonnes. There are no excessive rains so far and it is expected that harvesting will be duly completed resulting in higher output. Timely advisories have been issued to growers to tackle berry borer problem, according officials at the Coffee Board.
“The new crop will certainly help improve exports,” Rau said. The industry also faces huge challenges on the production front, mainly on account of climate change, costs on production, technology adoption and improving the productivity, he added.