Prices to remain stable in 2007

Price realisation of Indian coffee in 2007 is expected to remain around last year's level, said International Coffee Organisation (ICO) Executive Director Nestor Osorio.

"I don't see prices of Indian coffee going up or down substantially in the near future," he said.

ICO will extend an aid of $1 million to the Coffee Board of India for its pilot project aimed at increasing domestic coffee consumption. ICO has funded similar projects in Mexico and Indonesia.

According to Osorio, the fund is being raised through the Common Fund for Commodities, an inter-governmental financial institution established by the United Nations.

Coffee Board will be the nodal agency for the project and ICO the supervisory body. A few prominent coffee companies will also be roped in as private partners in the project.

On the global price trends in coffee, Osario said: "It remains firm. However, the average for January 2007 represents an increase of 10.51 per cent compared with the average for 2006 as a whole."

World coffee production for 2007 is projected to be between 109 million and 112 million bags (each containing 60 kgs), 10 million bags short of the anticipated global demand of 118 million bags.

Fall in Brazil's output is said to be the reason for the shortfall in production. The first estimates of the Brazilian authorities indicate a production level of between 31.1 million and 32.3 million bags against the average level of 35 million bags.