Indian coffee exporters are in no mood to buy old stocks, as the new arrivals have started hitting the market. This was the trend witnessed in the latest auction conducted by the Indian Coffee Traders? Association in the Coffee Board, as old stocks failed to attract buyers.
An official from the auctioneer Carritt Moran said the new arrivals from Tamil Nadu estates participated in the auction and witnessed demand from the exporters. He said the domestic players have shown interest in bidding for old stocks for the local market. Of the total coffee displayed for auction, new arrivals accounted for 5%, while the remaining 95% were old stocks accumulated from the last two seasons.
The exporters have shown interest in buying new arrivals from the 2007-08 crop season, as it would fetch a higher price at the international market. Only 20% of the old stocks were sold out in the auction, he said.
Another reason for sluggish transaction in the auction was higher prices, said PJ Suresh Babu of the coffee export firm Chaithanyaa Coffee in Bangalore. Babu said the coffee prices in India are more when compared to the international market. He said the Indian Arabica Parchment A is ruling at Rs 111-112 per kg, compared to Rs 106 per kg in the international market, while Robusta Cherry AB hovered at Rs 79-80 per kg, compared to the international price of Rs 75-76 per kg. Babu said the growers were also hoarding stocks anticipating higher prices, while buyers were waiting for prices to come down on the eve of new arrivals hitting the market.
Auctioneer Carritt Moran bought 96,443 kg, while J Thomas and Company bought 96,848 kg, and Forbes, Ewart and Figgis 50,507 kg for the auction. The market is expected to witness active transactions once the Karnataka crop hits the market in January.