Kochi: India’s Coffee Board has put the coffee production figure for 2006-07 at 0.29 million tonnes (mt) even as coffee growers and exporters say this estimate must be reviewed downwards to realistic levels of 0.25-0.27mt.
As per the post-blossom estimate of the Coffee Board of India, production during the last financial year was lower from the earlier estimate of more than 0.3mt.
However, exporters are saying that the actual production could be much less and even lower than the previous year’s 0.27mt.
Leading planter and Coffee Board member Anil K. Bhandari says that the production figures are being compiled and the board is making a valuation of the stocks available, and the export figures.
The board is likely to revise the figure downwards from the original projection, owing mainly to the drought conditions in Coorg in Karnataka, which did not receive pre-monsoon showers. According to him, the revision will be done in a fortnight and the production could be fixed in the range of last year’s 0.27mt.
Leading exporter Ramesh Raja of Bangalore-based Ramesh Exports says the actual production could be even lower as arrivals of coffee at markets have been low.
The total production could be close to 0.27mt. A clear picture of the export scenario will emerge next month and in all likelihood there will be lower exports, he adds.
The arabica variety of coffee accounts for nearly 40% of India’s production and the rest is the robusta variety. With domestic consumption being low and confined mainly to South India, nearly 80% of the production is exported. Robusta is of higher quality than the arabica variety.
Ramesh says that while the price of the roubsta variety has been rising in tandem with the international scenario, arabica prices are stagnant.
At last week’s Indian Coffee Trade Association auctions, robusta prices appreciated by Rs50-100 a bag (50kg). With this, the price has now risen by about Rs4,200 a bag.
However, a 10% increase in prices over the past few months has not given the exporters any relief in the backdrop of the depreciating value of the dollar vis-a-vis the rupee. The dollar has depreciated by about 10% since January.
A leading coffee grower and exporter Ashok Kurian, based at Coorg, says exporters and growers would be taking up the issue with the Coffee Board soon and seeking some help to tackle the effect of the rising rupee.
While exporters are offering lower prices for coffee taking into consideration the loss suffered through lower export earnings, coffee growers, too, would suffer since their produce would not fetch remunerative prices.
The growers and exporters are set to meet the board officials later this week seeking incentives on a long-term basis. “Details for the meeting are being worked out,” Kurien says.
Jeffrey Rebello, chairman of the planters body Karnataka Planters Association, says there is an overall drop in production. He feels that arabica production will be in the range of 75,000-80,000 tonnes and there will be a 15% fall in robusta output to about 0.18 mt. According to him, higher estimates will mean a projection of higher supply of coffee that can depress the prices. “One should not give wrong signal to the market,” he says.