Heavy rains in the coffee-producing states of Karnataka, Kerala, and Tamil Nadu are expected to reduce crop size by 10%, according to producers.
The Coffee Board’s post-blossom estimate for 2021-22 is 369,000 tonnes, with the robusta variety accounting for 260,700 tonnes. India produced 334,000 tonnes of coffee in 2020-21. A coffee year begins in October and ends in September of the following year.
‘Heavy rains are expected to have an impact on coffee production this year. As of now, we estimate a 10% drop in the coffee crop,’ said Jeffry Rebello, chairman of the UPASI (United Planters Association of Southern India) coffee committee.
Despite the fact that production may be declining, this year could be a good year for Indian coffee exports due to rising global prices. The price of Arabica coffee futures, a global benchmark, reached a seven-year high of $2.07 per pound near the end of July as severe frost hit coffee plantations in Brazil, which had already expected a lower crop because 2021 is a low-production year for the country. Although prices have dropped to $1.76 per pound, they are still 40% higher than they were at the start of the year.
In July, Robusta coffee prices rose in lockstep with arabica prices, surpassing $2,000 per tonne.
‘At the moment, Indian coffee growers have no output. As a result, growers are unable to benefit from rising international prices. If the price remains stable until November when our crop arrives, the trade can benefit from rising prices,’ said Rebello.
From January 1 to August 17, 2021, India exported 238187.877 tonnes of coffee, up from 215177.152 tonnes in the same period the previous year. Because crop prices were predetermined, growers were unable to capitalize on the current global price rally. The largest buyer of Indian coffee is Italy, followed by Germany and Belgium.
According to Coffee Board data, India’s coffee production increased by 12% to 334,000 tonnes in 2020-21. Robusta coffee accounts for nearly 70% of India’s production, which increased 11% from the previous year to 235,000 tonnes. In India, the crop output of Arabica has remained stable between 90,000 and 100,000 tonnes.
According to the International Coffee Organisation’s (ICO) recently released coffee market report, the monthly average of the ICO composite indicator is up 43.8 percent since last October, which marks the start of the coffee year.
The ICO stated, ‘This increasing trend in coffee prices over the first 10 months of the coffee in 2020-21 appears to confirm a net recovery from the low-price levels that have dominated the global market since the coffee year 2017-18.’