The Hindu Business Line : Coffee output likely to exceed 2.74 lakh tonnes

Notwithstanding the impact of excess rains, outbreak of pests and diseases on the country's 2006-07 coffee crop, the targeted exports of the commodity, driven by increased global demand and better prices, both in value terms at Rs 1,500 crore and volume at 2.05 lakhs will be easily achieved for the year, said the Coffee Board Chairman, Mr G.V. Krishna Rau, on Friday.

Pests' impact

Making a presentation on Coffee Outlook at Upasi's 113th annual conference in Coonoor, Mr Rau said the excess rains and outbreak of diseases like leaf rust and pests such as white stem borer in several main areas could have some impact on the country's coffee output for 2006-07.

"The 2006-07 crop would not be less than last year's 2.74 lakh tonnes," Mr Rau said, adding that a realistic picture would emerge only after the completion of post-monsoon estimates by end-November.

Output outlook

Coffee Board's post-blossom estimates had placed the 2006-07 crop size at 3,00,300 tonnes, comprising 1,03,700 tonnes of arabicas and 1,96,600 tonnes of robustas. The harvesting of 2006-07 crop would start from October.

Further, driven by increased global demand, the coffee exports have picked up in the current financial year. Export permits issued from April 1 to September 12 have registered a 40 per cent growth at 1,28,225 tonnes, compared with 91,480 tonnes for corresponding last year, he said.

Permits for the current coffee year (October 2005-September 2006) have shot up by 20 per cent to 2,33,910 tonnes as compared with 1,94,593 tonnes in corresponding last year.

Correction in prices

Commenting on the price outlook, Mr Rau said the robusta prices could see a correction with the arrival of fresh Vietnamese crop round the corner. However, prices are expected to remain comfortable at the current levels for the next one year.

Mr Rau further said that certain goals for the sector during the Tenth Plan period could not be achieved due to the prolonged global crisis in the commodity. However, the Indian robustas gained recognition by commanding the highest premium and exports of high value coffee, including specialty coffee increased during the Tenth Plan period, he said. The domestic consumption also shot up by 20,000 tonnes to 80,000 tonnes during the period.

New measures

For the 11th Plan period, the Board aims to address issues like making the Indian coffee growers sustainable in the long run by introducing a slew of measures even while focussing on boosting the output and domestic consumption. Mr Rau said the output could touch 3.1-3.2 lakh tonnes by the end of the 11th Plan as new areas to an extent of 25,000 hectares would come into production over the next few years. "Through proper promotional efforts, it is possible to double the domestic coffee consumption in the next decade," he said.

Further, Mr Rau said banks had recently decided to stop support the Special Coffee Term Loan (SCTL) package further. "Banks have written to us stating that they don't see any scope for further sacrifices," Mr Rau said. The loan and interest component under SCTL exceeds Rs 1,200 crore and growers had urged the Government to bring down this component by 50 per cent and reschedule the rest for 10 years with a lower rate of interest.

Mr Rau said a new package is being evolved on the lines of one announced for Vidarbha recently by the Prime Minister. Of the six districts being covered in Karnataka under the new package, three are coffee growing districts.

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