As prices turn volatile amidst the ongoing harvest, beleaguered coffee growers feel that this is the right time for the Centre to revive and strengthen the only multi-state co-operative Coffee Marketing Co-operative Ltd (COMARK) by financially supporting the growers body to take up market intervention activities.
The farm gate coffee prices have dropped by about a fifth over the past couple of months tracking global trends triggering concerns among growers, who have been facing other challenges such as unseasonal rains, rising wage costs and shortage of labour. A section of growers also feels that they do not get the full benefit of any increase in global prices and the gains from weakening rupee.
Prices of arabica parchment are now ruling at ₹13,100 per 50 kg bag compared with ₹16,000 in the first week of October. Similarly, Arabica cherry has come down to ₹6,400-6,700 from ₹9,100 levels in October. Robusta parchment prices have declined to ₹8,250-8,500 from ₹9,750-10,000 levels and robusta cherry to ₹4,150-4,250 levels from ₹4,700-5,000 levels.
“The Centre should strengthen COMARK by infusing fresh funds of about ₹50 crore, which could be utilised by the co-operative for procurement and marketing operations, a move that would provide some relief to small growers,” said B S Jayaram, Director, COMARK.
2013 attempts
The prices fixed daily by COMARK, based on the closing of New York and London prices and the rupee-dollar exchange rates were appreciated by the growers, but the co-operative lacks the financial strength to carry out the procurement and marketing operations on a larger scale, Jayaram said. Hence, there is a need to infuse fresh funds by the Centre to revive the coffee co-operative and the government has been approached in this regard, Jayaram, also the former chairman of COMARK said. Previously, the Karnataka government had infused ₹10 crore in 2013 to revive the COMARK.
Started in 1992, COMARK has about 10,000 grower members in the three major coffee producing States of Karnataka, Kerala and Tamil Nadu. “Strengthening of co-operative COMARK would be beneficial to growers in terms of better realisations,” said H T Mohankumar, President, The Karnataka Growers’ Federation, the small growers’ body. The trade, which fixes the farmgate coffee price does not pass on the entire benefits arising from the international price movement and forex gains, he said.
Growers with less than 10 hectares account for 98.8 per cent of the total coffee holdings of over 2.20 lakh in the country. Small growers with less than 2 hectares account for about 80.9 per cent of the coffee holdings.
Further, Mohankumar said the government should enhance the compensation provided under the disaster relief to the growers. Presently, the relief provided under NDRF is limited to two hectares per grower, which should be increased to 10 hectares and so also the quantum of compensation, he added.