Recession in the European countries and the United States will likely weigh on Indian coffee prices, while exports will likely be maintained in the year ahead. Europe and the US are major markets for Indian coffees and about two-thirds of the beans produced in the country are exported.

Orders are thin currently, but exporters expect orders to pick up once the Indian prices come in line with international prices.

“I think the volumes should be good. We should be able to export on par with last year. While last year, there was an increase in re-exported coffees, we think the green bean exports should also be good this year as the crop looks good. However, prices will be lower mainly because of the recession in Europe and the US. Though prices will be lower, we think the shipments will take place,” said Ramesh Rajah, President, Coffee Exporters Association.

Hinge on instant coffee

India’s coffee exports for calendar 2022 topped the 4-lakh-tonne mark and touched a record high of $1.11 billion on improved realisations, registering an 18 per cent increase in value.

“We should reach around 4 lakh tonnes this year too, but it all depends on the instant coffee exports. We don’t know what will be the impact of recession on them,” Rajah said.

The harvest of milder variety arabicas is almost coming to an end, while harvest of robustas has begun in the key producing areas of Karnataka and Kerala.

“Right now growers are hesitant to sell as prices have come off a bit in the past two months. There is some resistance on the part of the growers to sell. But we think that once the robusta variety starts arriving in the market in a big way, the shipments will pick up,” Rajah said.

“Orders are still slow, but we think it will pick up. Compared to the previous years, the order book is thin. Right now, the Indian prices are still a little above international parity and buyers are reluctant to give orders. We think once the arrivals start, Indian prices should drop and it will be more in line with the international prices. Going forward, if the Indian prices come on par with the international prices, the order book will improve,” Rajah said.

Jeffry Rebello, President, UPASI, said the harvesting had progressed with the weather clearing up over the past fortnight. “We are still assessing the crop size and it is too early to say. Robusta looks good in some places and average in some areas. Arabica is likely to be down by 10-15 per cent,” he said.

Bose Mandanna, a grower in Kodagu, said the robusta crop looks poor in the district and is seen lower by about 30 per cent as rains during the blossom period had impacted the crop setting. The rains had impacted the arabica harvest. “It is difficult days for growers as pepper is also not good and costs are rising while the prices are down. We hear that export orders are not easily available due to the recession in the Europe and the US. We will have to look for other markets such as Australia, South Korea and the Middle East and concentrate on the domestic market to boost consumption,” he said.

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