India coffee output to fall to lowest in two decades | Reuters

MUMBAI India's coffee output in the next crop year is expected to drop by around a quarter to the lowest in nearly two decades as poor rains and hot temperatures hit plantations during the crucial flowering stage, the head of an industry body said. The Asian country is the world's sixth-biggest coffee producer, although is well behind leaders Brazil and Vietnam. Nonetheless, lower production from India could provide more support to global prices, already surging due to a drop in the output in top producer Brazil.

Reuters May 17, 2016 23:45:12 IST
India coffee output to fall to lowest in two decades
| Reuters

India coffee output to fall to lowest in two decades
 Reuters

MUMBAI India's coffee output in the next crop year is expected to drop by around a quarter to the lowest in nearly two decades as poor rains and hot temperatures hit plantations during the crucial flowering stage, the head of an industry body said.

The Asian country is the world's sixth-biggest coffee producer, although is well behind leaders Brazil and Vietnam.

Nonetheless, lower production from India could provide more support to global prices, already surging due to a drop in the output in top producer Brazil.

"Dry weather is hitting plantations in the crucial flowering stage. On a conservative basis, we are estimating a 25 percent drop in production," Baba P. S. Bedi, chairman of the Karnataka Planters Association (KPA) told Reuters.

The southern state of Karnataka accounts for about 70 percent of India's total output. India is likely to produce 350,000 tonnes coffee in the current season ending on September 30, according to estimates by the state-run Coffee Board.

With a 25 percent reduction in Karnataka, production could drop to 263,000 tonnes in the 2016/17 crop year, the lowest since 1998/99.

The Coffee Board is expected to provide its first production forecasts for 2016/17 by mid-June, said D R Babu Reddy, an agricultural economist at the Board.

India, which started coffee cultivation in 1670 with seven smuggled beans, produces mainly robusta, used primarily in instant coffee.

"Due to the back-to-back droughts, ground water has been depleted," said Bedi, pointing to lower rainfall since the start of March on top of drought last year.

Coffee growing regions in southern India received up to 70 percent lower rainfall than normal from March to mid-May, according to the India Meteorological Department.

Higher than normal summer temperatures alongside water scarcity had badly impacted the conversion of coffee flowers into cherries, said Anil Kumar Bhandari, a large planter.

India exports three-quarters of its coffee production and production problems will dent shipments in 2016/17, said an exporter based in Bengaluru.

"This year, exporters are aggressively selling due to a recovery in global prices. Next year we will have very limited carry forward stocks," the exporter said.

Italy, Germany and Belgium are the main buyers of India's crop, paying a premium over global prices.

India's coffee exports have risen 19.4 percent to 213,187 tonnes since the start of current marketing year on October 1.

(Editing by Ed Davies)

This story has not been edited by Firstpost staff and is generated by auto-feed.

Updated Date:

also read

Tokyo Olympics 2020: Mexico thrash France as Richarlison hat-trick helps Brazil hand Germany 4-2 loss
Sports

Tokyo Olympics 2020: Mexico thrash France as Richarlison hat-trick helps Brazil hand Germany 4-2 loss

Sylvain Ripoll's France are looking for a first Olympic medal since winning gold in 1984, but collapsed in the second half at Tokyo Stadium.

Copa America 2021: Lionel Messi dedicates Argentina's title triumph to family, nation and late Diego Maradona
Sports

Copa America 2021: Lionel Messi dedicates Argentina's title triumph to family, nation and late Diego Maradona

Argentina's success over the Brazilians in Rio was not just Messi's first major trophy for the Albiceleste but his country's first continental honour in 28 years.

Pune: Major fire breaks out at IISER building; student sustains minor injuries
India

Pune: Major fire breaks out at IISER building; student sustains minor injuries

An official of the IISER, which located in Pashan area of the city, said that the fire broke out at one of the labs in the chemistry department of the main building