The Rs 1,400-crore package announced by the Centre is expected to check the losses met by the coffee exporters to some extent but it would not completely bail out the industry, according to All India Coffee Exporters Association (AICEA).
AICEA president Ramesh Rajah said the industry had already informed the Union government that the export earnings declined by $50 million after the rupee started appreciating. Rajah said the industry is glad that the ministry of finance has given some relief by reducing interest rates by 2%.
?However, we are disappointed that exemption from service tax and refund of taxes already collected has not been done,? he said.
?We are hopeful that the increase in the rate on DEPB licenses to 3% from the existing 1% announced by the ministry of commerce would be applicable to coffee as well. So far it is not clear. If it is applicable, this will be of great help to the entire coffee industry.?
According to the Coffee Board sources, as on July 12 coffee exports declined to 1,36,951 tonne during January to June in the current calendar year from 1,46,586 tonne exported in the same period a year ago.
Major loss was witnessed in Arabica exports due to the rising rupee. In the current calendar year till date, exports of Arabica parchments declined to 22,071 tonne from 38,701 tonne, while Arabica cherry recorded 7,641tonne compared to 7,665 tonne a year ago. In fact, a major portion of Arabica beans harvested during the end of 2006 is still lying in the curing works and warehouses in the country, trade sources said.
The commodity auctioned through Indian Coffee Trade Association (ICTA), too, witnessed fewer takers in Bangalore on Thursday. Auctioneers J Thomas and Company placed 1,26,270 kg of Arabica for auction, while Carritt Moran placed 72,411 kg and Forbes Ewart and Figgis brought 36,093 kg for auction. But only 15-20% of the beans were sold during the auction as most of the exporters did not bid as they decided to watch the trend for some time, sources said.
