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Coffee exports are set to fall about 10 per cent this year, as international prices have seen a decline in the past few days and the rupee has appreciated against the dollar.
In April and May, coffee prices remained volatile. In April, at 170.58 cents/pound, the International Coffee Organization’s composite indicator recorded its highest monthly average in about two years. It however, declined 3.9 per cent in May to settle at 163.94 cents/pound. While continued uncertainty about the crop in Brazil had initially raised prices, recent reports stating the losses of growers in Brazil would be lower than estimated resulted in a fall in prices.
“The crop in Brazil is not as bad as expected earlier. According to Conab, the Brazilian crop-forecasting agency, the damage is not going to be severe. Currently, the country is harvesting its 2014 crop,” said Nishant R Gurjer, former chairman of Karnataka Planters’ Association.
According to the Coffee Board, ICE arabica coffee futures sank amid volatile trade on Monday, as technical weakness and uncertainty over the extent of damage to the crop in Brazil led to selling by speculators and producers. Benchmark July arabica coffee futures dropped 5.15 cents, or 2.9 per cent, to close at $1.7235/pound, below its 100-day moving average of $1.7408. LIFFE July robusta coffee futures fell $4, or 0.2 per cent, to settle at $1,933 a tonne.
“As a result of the price drop, we expect shipments from India to slow after the monsoon. This year, exports could be lower by 15,000-20,000 tonnes, or 10 per cent. Farm-gate prices in Karnataka have already fallen 10-20 per cent in the case of arabica and about 10 per cent for robusta,” said Ramesh Rajah, president, Coffee Exporters’ Association of India.
For the January-May 2014 period, coffee exports from India stood at 160,164 tonnes, against 159,771 tonnes in the year-ago period, marginal growth of 0.2 per cent. In 2013-14, coffee exports rose 2.88 per cent to 313,035 tonnes from 304,251 tonnes in 2012-13. In value terms, exporters earned $812 million, 7.6 per cent lower than $879 million in 2012-13.In April and May, coffee prices remained volatile. In April, at 170.58 cents/pound, the International Coffee Organization’s composite indicator recorded its highest monthly average in about two years. It however, declined 3.9 per cent in May to settle at 163.94 cents/pound. While continued uncertainty about the crop in Brazil had initially raised prices, recent reports stating the losses of growers in Brazil would be lower than estimated resulted in a fall in prices.
“The crop in Brazil is not as bad as expected earlier. According to Conab, the Brazilian crop-forecasting agency, the damage is not going to be severe. Currently, the country is harvesting its 2014 crop,” said Nishant R Gurjer, former chairman of Karnataka Planters’ Association.
According to the Coffee Board, ICE arabica coffee futures sank amid volatile trade on Monday, as technical weakness and uncertainty over the extent of damage to the crop in Brazil led to selling by speculators and producers. Benchmark July arabica coffee futures dropped 5.15 cents, or 2.9 per cent, to close at $1.7235/pound, below its 100-day moving average of $1.7408. LIFFE July robusta coffee futures fell $4, or 0.2 per cent, to settle at $1,933 a tonne.
“As a result of the price drop, we expect shipments from India to slow after the monsoon. This year, exports could be lower by 15,000-20,000 tonnes, or 10 per cent. Farm-gate prices in Karnataka have already fallen 10-20 per cent in the case of arabica and about 10 per cent for robusta,” said Ramesh Rajah, president, Coffee Exporters’ Association of India.
Rajah said as of now, prospects of the next crop in India looked good, as growing regions had recorded good blossom showers. However, clarity on the matter will emerge only in September, when the monsoon is over.
