The Hindu Business Line : Coffee Board cuts output estimate

Domestic coffee growers could miss out on the bull party that is out in the global market. With prices ruling firm on anticipated lower crop in Brazil and funds buying into coffee, the decline projected by the Coffee Board in the production could make them miss the gains a bit.

The Coffee Board on Thursday came out with a revised estimate or post-monsoon projection on the production that is lower by 12,300 tonnes from the post-blossom estimate of 3.03 lakh tonnes. Post-blossom estimate is made after the buds in the coffee plants blossom. The production will, however, be higher by 14,000 tonnes compared with last season's production of 2.74 lakh tonnes.

According to Mr Anil K. Bhandari, though Indian crop does not make a big impact in the global market, the growers will definitely miss a bit of the firm prices the market is currently enjoying.

"Prices were expected to decline to around $1,250 a tonne for robusta now. It has not happened. But there could be physical deficit after April and definitely, the high prices for coffee will be sustained," he said.

On Thursday, benchmark March robusta contracts were quoted at $1,580 a tonne.

"It is a low crop for everyone except Vietnam next season," Mr Bhandari said. As per the Coffee Board's estimate, arabica production is expected to be 99,700 tonnes against initial estimate of 1,03,700 tonnes. Robusta output is seen slipping to 1,88,300 tonnes from 1,96,000 tonnes. Last season, arabica production was 94,000 tonnes and robusta 1.8 lakh tonnes.

The robusta crop has improved this year mainly on good showers. The crop in plantations with irrigation facilities also gained. However, the arabica crop was affected by white stem borer infestation. In fact, the pest has been playing havoc with the arabica crop for the last couple of years.

As per the Coffee Board's estimates, production in all the three major growing States - Karnataka, Tamil Nadu and Kerala - is lower than initial estimates.

In Karnataka, the output has been pruned to 2.06 lakh tonnes from the post-blossom projection of 2.15 lakh tonnes. In Tamil Nadu, the production has been pruned to 18,225 tonnes from 19,700 tonnes. In Kerala, it is seen dipping to 59,475 tonnes from 61,200 tonnes.