Lower production estimates for Arabica coffee is likely to support the domestic coffee market, officials of the United Planters Association of South India (UPASI) said. However, volatility in the international coffee prices due to speculative activities is causing concern. India exports 65% to 70% of the coffee produced in the country while the rest is consumed within the country.
Production of Arabica coffee is likely to be lower than the Coffee Board estimates due to erratic rain, diseases and farmers shifting to Robusta variety, Vijayan Rajes, president of UPASI said. The Coffee Board has estimated the 2014-15 crop (post monsoon estimate) at 3.31 lakh tonnes, with Arabica output at 0.99 lakh tonne and Robusta at 2.31 thousand tonne. Earlier, Coffee Board had projected the crop (post blossom estimate) at 3.44 lakh tonne, representing a decline of 0.13 lakh tonne.
“If one as to go by the previous episodes of coffee crop estimate, the final estimate would be in the region of 3 lakh tonnes. The growers view is that projections, as in past will miss the target, especially in Arabica that had been heavily infected,” Rajes added.
Coffee planters in India are seen shifting from Arabica to the Robusta variety due to diseases like the white stem borer and increasing cost of production forces. Experts feel that the long-term effect of the shift would be disastrous as coffee lovers’ value Arabica at a premium over Robusta.
Arabica coffee is roasted and ground for brewing and can range widely in quality, with some reaching the highest levels. Robusta, on the other hand, is more bitter and either processed into instant coffee or added to a roasted blend to reduce the cost.
The global coffee production during crop year 2013-14 is estimated at 146.8 million bags, marginally higher than the previous year. UPASI reports that the production prospects for 2014-15 season are somewhat mixed due to the changes in the weather pattern across major producing countries, which may have some effect on the final crop.
UPASI reports that the coffee exports during April-January 2015 was placed at 2,19,047 tonne, valued at R3,766.67 crore and unit value of R171.96 per kg. The quantum exported was lower by 19,457 tonne, while value realisation was higher by R154.29 crore and unit value was higher by R20.50 per kg. During 2013-14, India produced 3, 04,500 tonnes of coffee, of which only 1,02,200 tonne was Arabica variety.
