NEW DELHI: India’s coffee exports have shown an upward trend for the first time in the last three years by recording a growth of 13% in 2015-16. The bean exports have gone up to touch a level of 317,850 tonne in the just concluded financial year. In 2014-15, exports stood at 281,988 tonne and 299,178 tonne in 2013-14.
The rise in exports is mainly attributed to higher domestic crop and lower base built up over the previous years. Higher demand for instant coffee from the country in the global markets also contributed to rise in exports this year. Instant coffee accounts for around 25% of total exports. Instant coffee makers import raw beans from Vietnam and other countries for value addition and re-export mainly as instant coffee. The re-exports are estimated to be 80,000 tonne in FY16.
“Last two years we had lower exports and the base got reduced, which helped in registering a growth in exports for the current year. Exports have been in line of our expectations. We had projected around 10% growth this year,” Ramesh Rajah, president, Coffee Exporters’ Association, told FE.
He said shipments during the fourth quarter of the year were very good, which added to the growth. In the January-March quarter, exports went up to 95,529 tonne compared to 81,500 tonne in the same quarter last year, a growth of 17.2% year on year.
India exports coffee to over 40 countries. Italy, Germany and Russian Federation are its top three markets. In value terms, Indian exporters earned 6% higher returns at R5,177 crore compared to R4,878 crore in the previous year. However, in dollar terms, export earnings were flat at $792 million compared to $799 million in the previous year. The average unit value realisation also went down to R162,890 per tonne as against R172,858 per tonne.
“The average unit value per tonne went down this year due to lower international prices and higher Robusta shipments. Robusta prices are lower compared to Arabica. The shipment of Arabica has not been much, resulting into decline in the overall value per unit,” Rajah said.
He said New York market has seen prices of 130 cents per pound for Arabica compared to 200 cents per pound last year. In the London market, Robusta prices declined to $1,400 per tonnes compared to $1,800 per tonne, a drop of 22% year on year.
Rajah said more farmers opted for advance selling as they were looking for money. “We expect shipments to drop during the second half of this calendar year. Prices will also stagnate or come down further as Brazil will come out with its crop in May/June,” Rajah said. Currently, prices are hovering around 127 cents per pound for Arabica, a decline of 21% over the last year. In 2015, Arabica had hit a high of 227 cents per pound in September.
