The year ahead looks promising for Indian coffee exports, both in terms of volume and prices. The International Coffee Organisation (ICO) has predicted that global coffee production during the 2009-10 crop year might dip below the last year level of 128.1 million bags. The global output this year may be down 2 per cent at 123-125 million bags. One bag contains 60 kg coffee.
Adverse weather conditions in the major coffee growing countries of Brazil, Vietnam and Colombia have hit production.
However, India may see a good harvest of around 300,000 tonnes, 16 per cent higher than last year. On the one hand, the higher Indian output may boost exports, while on the other hand, the supply may help fetch better prices internationally, according to industry sources.
“India will be in an advantageous position. Production here is comparatively good. So exports will sure be higher than last year. Global prices will remain firm due to supply shortage. Hence, India stands to gain,” said Babu Reddy, agricultural economist at the Coffee Board.
India witnessed heavy rains, especially in the major coffee growing state of Karnataka during October-November. However, the rains are unlikely to have an adverse impact, and, in fact, may hasten the ripening process of coffee beans, thereby controlling the spread of berry borer and white stem borer. This may add to crop prospects, according to Coffee Board Chairman GV Krishna Rau.
During 2008-09, India produced 262,300 tonnes of coffee. For the present crop year beginning October, the board has estimated an output of around 306,300 tonnes — arabica at 101,525 tonnes and robusta 204,755 tonnes. The crop will arrive in the market by January.
The exact extent of crop damage due to rains will be revealed in the board’s post-monsoon estimates, which is expected soon. Only a marginal decline in output is expected.
Marvin Rodrigues, a coffee planter from Hassan district, said the damage could be more pronounced for arabica. “But, overall, the fundamentals are good,” he added.
Indian exports were hit by the global recession. During January 1-December 8, 2009, the country exported 177,995 tonnes of coffee, 16 per cent lower than last year.
| RICH BREW Production of coffee in major states (In tonnes) | ||||||
| State | Post monsoon estimation 2008-09 | Post blossom estimation 2009-10 | ||||
| Arabica | Robusta | Total | Arabica | Robusta | Total | |
| Karnataka | 61,135 | 122,725 | 183,860 | 79,720 | 141,755 | 221,475 |
| Kerala | 1425.00 | 55,775 | 57,220 | 1,375 | 58,175 | 59,550 |
| Tamil Nadu | 12070.00 | 4,185 | 16,225 | 14,850 | 4,700 | 19,550 |
| Others | 4870.00 | 115 | 4,985 | 5,580 | 145 | 5,725 |
| Total (India) | 79,500 | 182,800 | 262,300 | 101,525 | 204,775 | 306,300 |
| Source: Coffee Board of India | ||||||
Ramesh Rajah, president, Coffee Exporters Association of India, said exports might pick up from March.
According to ICO, while the output will be lower in Brazil, Vietnam and Colombia, it may rise in Asia, Africa and Central America. Production in Brazil, the world’s biggest coffee grower, is estimated at 39 million bags in 2009-10 against 45.99 million bags a year ago. Vietnam produced 16 million bags and Colombia 8.7 million bags in 2008-09.
Indian coffee is fetching around $1.4 a pound in the international market. “In the short term, prices will remain firm at around $1.3-$1.5,” said Rajah. India exports nearly three-fourths of its production. Domestic consumption has also been growing over the years, and may soon reach 100,000 tonnes a year. Prices were also attractive, said a grower, indicating that several growers, hit by the reduction in global demand, planned to raise sales this year.
