Coffee exports from India declined in the first six months of 2009 following lower demand in the global market.
According to the state-owned Coffee Board, the coffee exports declined by 20% to 1,08,386 tonne during January-July 9 from 1,36,220 tonne during the year-ago period.
A sudden fall in price due to various factors in the global market has dragged down exports, trade sources said. According to the International Coffee Organisation (ICO), the price indicator chart, the monthly average price for coffee in the global market, declined in June to 119.05 cents per lb from 130.51 cents per lb in the same period a year ago. Except in May and June, the monthly average price of coffee in the international market never crossed 111 cents per lb in the first six months of 2009.
The export volumes primarily tumbled as Arabica parchment coffee from India lost demand in the global market. Arabica parchment exports fell by 43% to 16,241 tonne from 28,600 tonnes. Robusta parchment exports tumbled by 23% to 9,414 tonne from 12,271 tonne, while exports of Robusta cherry declined to 52,101 tonne from 56,325 tonne. Instant coffee exports dropped to 16,053 tonne from 20,670 tonne.
The gloomy market sentiment in the global market also reflected in the weekly coffee auction conducted by the India Coffee Trade Association (ICTA) at the Coffee Board on Thursday. J Thomas & Co, one of the two coffee auctioneers attached to ICTA, showcased 3,74,226 kg of coffee. But it could sell only 82,000 kgs. The spokesperson of J Thomas & Co said, “All varieties received selective enquiries from domestic trade, while exporters were active only on Robusta Parchment.”
Reduced exports also have been attributed to decline in production for the crop year 2008-09. As per post monsoon estimation, coffee output for 2008-09 stood at 2,62,3000 tonne, down from post blossom estimation of 2,93,000 tonne. Although the Coffee Board has provided positive projection for the crop year 2009-10, the exact coffee output could be judged only after southwest monsoon as the crop could be damaged if there is erratic rain. The board’s post blossom forecast for 2009-10 stood at 306,300 tonne, up from the post blossom estimation for the previous year at 2, 93,000 tonne.
Coffee production in Karnataka, which accounts for around 70% of the country’s total coffee output, is expected to increase to 221,475 in 2009-10 compared to the post-blossom estimation of 214,170 tonne for the year 2008-09.