Coffee exports up by 2% during Jan-Nov 2008 on weak Re

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Mumbai: Coffee exports rose nearly 2% during the first eleven months of 2008 on strong demand from European countries and a weak rupee, an official from the Coffee Board said on Monday. Total exports during the January-November period stood at 208,023 tonne, compared with 204,538 tonne a year ago, the official, who did not want to be identified, told Reuters.

Exports of Arabica coffee rose 16% to 46,598 tonne during the period, while Robusta exports remained almost steady at 104,255 tonnes. Arabica is mainly used in premium coffees, while Robusta is typically blended with Arabica beans as a lower-cost option for brewed coffee, or processed into instant coffee. The unit value, or price of a kilogram of coffee has risen to Rs 109.2 during the January-November period, compared with Rs 86.7 a year ago, the Coffee Board official said. A weak rupee would make the Indian crop cheaper than that from other countries and hence boost exports. The rupee has fallen by about 21% so far this year.

However, exports in 2009 may fall by 8%-10% to about 200,000 tonne on expectations of a low crop, said Ramesh Rajah, president, Coffee Exporters Association of India. The Coffee Board has lowered its estimate for total coffee output in 2008-09 by 5.6%, citing untimely rains in October in some parts of Karnataka, the largest growing state.

The total coffee output is likely to come down to 276,600 tonne during 2008-09 from an earlier estimate of 293,000 tonne, the board said in its post-monsoon estimate released in late November. In India, coffee production season is from October to September. The country is the world’s sixth largest coffee producer and exports about 70%-80% of its output.

India exports coffee mainly to Italy, Germany and Russia. Italy accounts for about 25% of the country’s coffee exports, followed by the Russian Federation and Germany with 9% and 7.8% respectively.