Realisations dip locally: Why coffee exports from India set to decline in 2018

New Delhi | Published: January 10, 2018 2:59:01 AM

Coffee exports from India, the third-largest producer in Asia, is set to drop this year as unfavourbale weather and pest attacks is likely to lower production amid slump in the prices.

coffee export, total coffee export, coffee export in india, india coffee exportThe exports may slide about 5% to 2.40 lakh tonne in 2018 calendar year, said Ramesh Rajah, president of Coffee Exporters Association.

By-Prabhudatta Mishra     

Coffee exports from India, the third-largest producer in Asia, is set to drop this year as unfavourbale weather and pest attacks is likely to lower production amid slump in the prices. The exports may slide about 5% to 2.40 lakh tonne in 2018 calendar year, said Ramesh Rajah, president of Coffee Exporters Association. The country had exported 2.53 lakh tonne in last year after the Coffee Board approved shipments for 3.86 lakh tonne. Normally, when production is down, prices should be higher. But due to a global surplus, overall prices are down and that has affected rates in India too, Rajah told FE. The coffee production in the world is estimated at 159.9 million bags (of 60kg each) in 2018, according to US department of agriculture. Rajah said since the previous year had even higher level of production globally, the coffee prices are depressed. Farmers in India have realised Rs 6,500-Rs 7,000 per bag (of 50kg each) in the crop harvested from October 2017 as compared to Rs 9,000-10,000 per bag in the year-ago period. He said that top countries like Brazil, Vietnam and Colombia had good production whereas India’s output declined after lower rainfall during peak time when the crop blossoms. Additionally, there were also pest attacks in some of the growing areas. Vietnam and Indonesia are the top two coffee growers of Asia.

To help stabilise Indian coffee price, there is a need to increase domestic consumption, said Anil Kumar Bhandari, president of India Coffee Trust. The per capita consumption has only increased to 100 grams in India from 89-90 gram five years ago, while in many other countries it is in kilogram, he said.

India Coffee Trust in association with Coffee Board will hold the next India International Coffee Festival in Bengaluru during January 16-19 with the objective to increase domestic consumption, he said. In India, at least 40% of the Arabica coffee has been affected last year because of stem borer insect, which affected productivity. The Coffee Board is in talks with some bio-tech companies to find solution to the pest attack.

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