India's coffee exports dip at 6% following supply squeeze and slack demand

KOCHI: Indian coffee exports have dipped nearly 6% for the eight-month period that ended August 2014, following a supply squeeze and slack demand. While demand is expected to pick up in the coming months, growers fear that the inclement weather will pull down production.
Coffee export figures touched 2,22,297 tonne by August-end. This is 5.5% lower over the same period last year. The exports had shown a rise in the initial months because of increased shipments of arabica. But the shipments have slowed down after April.

“We expect it to pick up during the latter half of the year when the countries start buying for winter months . Since the Brazil crop is forecast to be on the lower side, the prices could remain on the higher side,'' said Ramesh Rajah, president of the Coffee Exporters' Association of India.

The output in Brazil, the largest producer of arabica coffee which determines the coffee prices in the global market, is predicted to be between 45 to 48 million bags (in bags of 60 kg), down from above 50 million bags last year. Robusta shipments from India have slumped 19%.

On the other hand, arabica exports were higher 14% because of earlier shipments. Around 70% of the Indian coffee production is robusta.

Vietnam, the largest producer of robusta coffee is reported to have harvested a good crop. Hence, robusta prices are expected to remain more or less at the current level of $2,000 per tonne in the global market.

The growers said the Indian crop of arabica could be down 30 % next year. “Heavy rains in several areas have led to black rot in coffee plants. The arabica crop had been hit by white stem borer during the pre -monsoon months. We think the crop could be 60,000 tonne,'' says Govindappa Jayaram, chairman of Karnataka Planters' Association.