Prices of robusta coffee continue to move up in India in sync with the global trend on supply issues in Vietnam, the largest producer, while the arabica prices are largely ruling stable. <\/p>\n
Prices of robusta cherry, the widely produced variety in the country, crossed the \u20b910,000-mark for a 50-kg bag recently and are currently hovering around \u20b910,400 levels at the farmgate. Robusta cherry prices have gained by close to a tenth from the early April levels, and have moved up by over 50 per cent since early January. <\/p>\n
Similarly, the robusta parchment prices have moved up to record levels of \u20b918,300 per bag \u2014 an increase of around 66 per cent over early January levels. Globally, robusta futures at the ICE have also seen an increase of over 60 per cent in the year-till-date. <\/p>\n
\nGrowers in no hurry
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Ramesh Rajah, President, Coffee Exporters Association, attributes the surging price trend in robustas to the lower availability from Vietnam. Also the demand from European buyers ahead of the year-end deadline for the EUDR (European Union Deforestation Regulations), is aiding the price trend. <\/p>\n
Rajah said some growers, who feel that prices would go up further, are still not in a rush to sell.<\/p>\n
\u201cWe think that 70 per cent of the coffees have been sold while 30 per cent is still with the growers,\u201d Rajah said adding that it was just a \u201cguesstimate\u201d. <\/p>\n
India\u2019s coffee exports in the calendar year 2024 till July 11 were up by 11 per cent at 2.53 lakh tonnes (lt) over 2.28 lt in the same period a year ago, per the Coffee Board data. The increase has been primarily led by higher demand for robusta cherry followed by instant coffees. Robusta cherry exports were up by 18 per cent at 1.19 lt during the January 1 -July 11 period against 1.01 lt a year ago. The instant coffee shipments, including the re-exports, were up over 11 per cent at 82,771 tonnes. <\/p>\n
\nOpportunity for India
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Praveen Kumar Kolimarla of Agrani Coffee and Commodities Ltd, who sources beans for exporters and roasters, said robusta continues to be very tight in terms of availability and prices due to supply issues in Vietnam and Indonesia. \u201cWith Vietnam and Indonesia not selling any coffees, there\u2019s an opportunity for India. Also with monsoon turning active, there\u2019s some liquidity available and more coffees are being released by growers amidst demand from buyers,\u201d he said. <\/p>\n
In its recent outlook, BMI, a Fitch company expects coffee markets to remain buoyant over supply issues from key producers such as Vietnam and Brazil. \u201cContinued accumulation of stocks could create some headwinds to price development in H2 2024. Meanwhile, rainfall and water reservoir levels in Vietnam ahead of the peak of the coffee robusta harvest in November 2024-February 2025 will be monitored; replenishment will be vital if a further production decline is to be avoided.\u201d BMI said. <\/p>\n
Also, the earlier dissipation of the 2023-2024 El Nino event and the expected onset of a La Nina event in August-October 2024 represents a positive shift from the perspective of rainfall levels in South-East Asia. \u201cFurther ahead, the Brazilian coffee harvest is set to return to an off-cycle in MY2024\/25, which tends to be associated with an annual decline in domestic coffee production, which could augur further market tightness,\u201d it said.<\/p>\n