The Hindu Business Line : World coffee exports down on dip in output

World coffee exports dropped by 5.64 per cent during the last 12 months (August 2005-July 2006) compared with the previous year on decline in output the world over.

Exports during the 12-month period amounted to 84.73 million 60-kg bags - a decrease of 5.64 per cent from 89.79 m bags in 2004-05.

Arabica and robusta exports stood at 56.14 m bags and 28.59 m bags, respectively, compared with 60.15 m bags and 29.64 m bags in 2004-05, according to International Coffee Organisation (ICO).

Meanwhile, the world consumption of coffee in the calendar year 2006 is estimated at around 117 m bags. In 2005, it totalled 115 m bags of which 30 m bags were accounted for by domestic consumption in exporting countries and 85 m bags represented consumption in selected importing countries such as 31 countries in Europe and others - Japan, Norway, Switzerland and the US.

Imports

Imports by European countries stood at 66.53 m bags in 2005 compared to 65.55 m bags in 2001 while that by other importing countries increased to 29.84 m bags in 2005 from 27.80 m bags in 2001.

However, the per capita consumption in most of these countries showed a decline in 2005 compared to 2001. Finland continued to top in per capita consumption of coffee, which has gone up to 12.02 kg in 2005 from 11.01 kg in 2001.

Per capita consumption

Other countries having high per capita consumption after Finland are Norway (9.71 kg), Denmark (9.04 kg), Switzerland (8.97 kg), Sweden (7.76 kg) and Austria (5.95 kg).

The per capita consumption in the US and Japan was 4.22 kg and 3.27 kg respectively, while in the European Union as a whole was 5.01 kg in 2005.

The world coffee output in 2005-06 fell by 8 m bags to 112.69 m bags from 120.73 m bags the previous year.

However, the production forecast for 2006-07 compiled by the Upasi, has shown an increase of 10.95 m bags taking the total to 123.64 m bags from 112.69 m bags the previous year.

Indian output

The Indian production in 2006-07 has been projected at 4.66 m bags as against 4.4 m bags the previous year and 4.59 m bags in 2004-05.

Exports from India also declined in 2005-06 to 3.06 m bags from 3.34 m bags the previous year.

However, the shipments in 2006-07 have been projected at 3.22 m bags.

In July, according to ICO, the coffee market recorded a slight upward trend in prices, which became more pronounced in the first week of August when the New York and London futures markets recorded significant rises. More specifically, Robusta prices have been rising sharply since the end of July.

On August 2002, the Robusta indicator passed the 70 US cents/lb mark, reaching its highest level since December 08, 1999.

Demand for all groups of coffee continues to be buoyant, while exports were down by 7.23 per cent in June compared to their level in May.

The figure for cumulative exports in the first nine months of coffee year 2005/06 was 63.11 m bags compared to 68.99 m bags for the same period in coffee year 2004/05.

Upward trend

According to a latest report, due to the shortage in the world market the prices are expected to continue its upward trend.

Prices of robustas, Columbian milds, other milds and Brazilian naturals recorded an increase in July compared to the previous month. The differentials with other mild Arabicas has been narrowing and was 40.51 US cents/lb in July compared to 42.92 cents in June, 49.28 cents in May and 54.87 cents in April last, the ICO sources said.

The upward trend in the robustas, according to them, indicated a relative shortage in its supplies mainly from Vietnam and Indonesia, the major producers apart from Brazil.

Stock levels were reported to have also fallen in importing countries. Stocks of green coffee, including free ports, are estimated at around 19 m bags, which remains below the levels of 2005. The level of certified stocks in the London futures market fell while that in the New York futures market rose slightly at the end of July compared to the level at the end of June, said a report.

An increase in Vietnamese production is anticipated in the crop year 2006/07 while Indonesian production has fallen. The latest estimates from Brazil, which has already harvested half of its 2006/07 crop, have been established at around 40.62 m bags, they said.

Cautioning the growers against expanding the coffee frontiers in any part of the world, ICO sources emphasised that they should instead, focus on renovating the planted areas and increasing productivity.

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