Wednesday, July 19, 2017

Coffee exports may fall 15 to 20% this year

KOCHI: Indian coffee exports are likely to fall 15-20% in the current year as exporters haven’t got enough orders for the coming months.

As per Coffee Board’s export data for the period from January 1 to July 17, 2017, the total export volumes were at 2,16,926 tonnes –– a marginal drop compared to same period last year. “But in the coming months, the drop will widen,” said Ramesh Rajah, president of the Coffee Exporters Association of India.

“Towards the end of last year, we had taken fewer orders as growers had estimated a 30% drop. But in the end it was down by only 10%. Whatever orders we had have been shipped. Now it is difficult to find buyers as they have bought from other origins,” Rajah said.
The Coffee Board’s total coffee production estimate for 2016-17 was 3,16,700 tonnes with 2,20,500 tonnes of robusta and 96,200 tonnes of arabica.

Global robusta coffee futures prices, after rising to over $2,200 per tonne in January, declined by $200 in subsequent months. It has again touched $2,126 per tonne now. “Arrivals decreased in the market as growers expected better prices. Though prices are up now, buying has slackened,” said MP Deviah, general manager of Allansons, a major exporter.

Exporters are pinning their hopes on next year’s crop, which again is likely to fall short because of inadequate rains in the coffee-growing regions of Karnataka and Kerala. While growers had predicted a steep drop in arabica last year, they feel robusta, which accounts for nearly 70% of the total coffee output in the country, will be hit in the next crop.

“There is not enough ground water and the south west monsoon has been poor. Though the coffee blossoms were good, the formation of robusta berries has been hit by inadequate showers. So our calculation is the production could be down by 30%,” said MM Chengappa, chairman, Karnataka Planters’ Association

Wayanad, the coffee-growing region of Kerala, has been declared most rain deficient. “Intermittent rain and sunshine has resulted in the onset of blackrot (a fungal disease) in the shrubs here. Given the present condition, the crop should be lower by 15% here,” said Prashant Rajesh, secretary of Wayanad Coffee Growers Association.

Meanwhile, coffee auctions held once a week in Bengaluru has been hit after introduction of GST. Only a small percentage of the production is auctioned. The nil duty and 5% tax rates for coffee beans have confused traders.
Coffee Exports Data

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