The government will release R58 crore more towards waiving loans for small coffee growers who are struggling to repay debts, and hence unable to plant fresh crops, a senior official said on Friday.
The government had earlier disbursed R241 crore in the last fiscal through March 2011 in two equal tranches to help small coffee growers, who account for around 70% of the country?s output. ?There was demand for additional support to waive loans of small growers as their number runs into several thousands. So more funds have been granted,? said the official, who didn’t want to be named.
The government had earmarked funds in June 2010 to provide relief to small growers, as most of the growers own small tracts of land and were the worst-hit when a crippling drought hit the country in 2009. The repayment of loans would enable the re-plantation of coffee across key growing states in the southern region, he added. Replanted coffee crops usually take three to five years to grow and would bear berries for up to 40 years after maturity.
India, the world’s fifth-largest coffee grower, usually exports about two-thirds of its output annually. Fresh planting and easing liquidity crunch may boost production. The country expects to produce 320,000 tonne of coffee in the crop year through September, up 6% from a year before.
India accounts for less than 5% of the global coffee output, but ships 70% to 80% of its produce, mainly to Italy, Russia and Germany. The country’s coffee exports rose more than 20% in 2011 to hit a record 346,850 tonne in 2011, although the global financial crisis and a depleting inventory may trim shipments this year, according to official data.
Coffee exports, in value terms, rose to $1.05 billion in 2011, compared with $634 million a year earlier, according to the state-run Coffee Board.
