July 26: Indian coffee has a mere three per cent presence in the international coffee production scenario. This compares all the more poorly when one looks at the Brazilian presence of 35 per cent in the world market.In India, the poor coffee production is a reflection of the way marketing has been managed all these decades. The plight of small planters adds to the gloom.
The only section that benefited by coffee business in the country is the middlemen who exploited small planters over the years.
Now that the Coffee Board has all but closed shop, large planters seemed to have been thanking their stars because they are no more at the mercy of mandarins in Delhi or Bangalore.
But that is only one side of the coin, the other side being more challenging considering the fate of the commodity because of its global dimensions. However, of late, observers of the coffee-growing districts in Karnataka - which accounts for 70 per cent of Indian coffee production with Kerala and Tamil Nadu sharing the rest ofthe production - predict gloom for the 1998-99 season.
They have apprehension on the following counts:
Brazil is likely to pump in 36 million bags of coffee this year. The Brazilian weather prospects have not foreseen any big damage due to frost which means weather across Brazil is favourable to coffee. This is in negative comparison with Indian weather scenario this season when people's representatives have already started making representations to the Centre regarding damages at large owing to excessive rains so far in 1998. Authorities at the coffee growers societies have been expecting Brazil to flood the international market with consignments during July and August 98 with a lower price tag. International coffee market is weak since all major traders are awaiting the Brazilian bumper coffee to hit the market which will be cheaper. As much as 80 per cent of Indian coffee growers generally cannot afford to wait for good prices and release their produce during Aprilitself when they will have to repay the loans they have taken from coffee societies. While Brazil offers 12 to 17 cents discount per pound of coffee, India offers discounts up to five cents per pound which can be another deterrent for Indian coffee to move competitively in the global market. Indian robusta coffee was once in the premium grade whereas, now, owing to large-scale of estate-pounded coffee (EP coffee), Indian coffee has downgraded itself to the discount category from the premium category.Copyright © 1998 Indian Express Newspapers (Bombay) Ltd.
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