India’s Coffee Exports to Slow After 75% Surge

Chennai: Frontloading of shipments ahead of the implementation of European Union’s deforestation regulations and the spike in international prices saw coffee exports moving up this year. The exports in value terms were up 75 per cent in September and 50 per cent in the nine-month period and are already higher than the entire shipments in 2023 by 25 per cent.

Between January and mid-October this year, the country exported Rs 11948 crore worth of coffee against Rs 7950 crore in the same period last year and Rs 9555 crore for the entire year of 2023, as per the data of Coffee Board.

“The smaller crop in Brazil and Vietnam saw international coffee prices almost doubling this year. This saw the export value increasing by 50 per cent while the volumes went up only by 15.6 per cent,” said Ramesh Rajah, president, Coffee Exporters Association. Arabica prices in the international market have gone up to 250 cents per pound against 140 cents last year and Robusta prices are up to $4700 per tonne against $2400 last year.

Further, European Union’s deforestation regulations for coffee production were earlier announced to be implemented from January 1, 2025. This made exporters frontload their produce to the European markets. The largest markets for Indian coffee this year are Italy and Germany and the European countries have contributed almost 40 per cent of the purchases.

“However, the implementation of the regulations has been postponed by one year and hence we would see some moderation in shipments to these countries going ahead. Though Indian coffee planters will not be affected by the regulations per se, the paperwork and processes involved in proving compliance is cumbersome,” said Raja.

While the exports have been increasing this year, the production has been stagnant. This along with the higher international rates saw coffee prices in the Indian market going up by Rs 100 per kg over the previous year.