Coffee exporters are unperturbed over the weak economic conditions in the Eurozone, mainly in Germany – one of their biggest market.

Exporters feel that the current economic condition is unlikely to hurt shipments to Western Europe and are looking forward to the new crop arrivals to meet their commitments.

Transition

“It (the economic condition) may see consumers moving from top quality to medium or low-end coffees, but, it may not have any impact on our shipments,” said Ramesh Rajah, President, Coffee Exporters Association.

The European markets led by Italy, Germany and Belgium are among the top five destinations for Indian coffee and accounted for over 41 per cent of exports in 2013-14.

Germany bought over a tenth of Indian coffees exported in the last financial year.

Rajah said exports this year are flat; in fact, a bit lower than last year’s. However, shipments are expected to pick up with the arrivals of the new crop sometime in the second half of December.

“Overseas demand is there but offerings are low, may be due to the end-of-season factor. Coffee from the old season is still available, but at a higher price. Because of the season-end, prices are ruling higher and that is the reason why exporters are reluctant,” Rajah said.

In 2013-14, the coffee exports were 3.13 lakh tonnes, up 4.6 per cent over previous year’s 2.99 lakh tonnes. In the current financial year, exports till September 17 were down 6.8 per cent at 1.37 lakh tonnes. In value, exports have fetched $385 million against $397 million in the same period a year ago.

Still in demand

“There is no dearth of market for Indian coffees,” said C Rajendra Prasad, Chairman and Managing Director, CCL Products (India) Ltd, a large exporter. On the contrary, the economic crisis in Europe could fuel more demand, Prasad said adding that the Indian coffee sells because of its quality and commands a premium.

The Coffee Board has projected a record output of 3.44 lakh tonnes for the 2014-15 season as per the post blossom estimates over previous year’s 3.04 lakh tonnes

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