Dubai to provide the perfect brew for coffee trading

After developing Dubai as the largest global trading hub for gold and diamonds, the Dubai Multi Commodities Centre (DMCC) plans to set up an export hub for coffee at the Jumeirah free trade zone.

Located close to the Jebel Ali Port harbour, the coffee centre — being developed on 4,500 sq m — will provide temperature-controlled storage and warehousing facility with office and co-location space for exporters.

Coffee companies can bring their produce to the warehouse and export them to global markets without paying any duty.

DMCC Chief Executive Officer Gautam Sashittal said the decision to develop a coffee centre was taken after the tremendous response received from corporates for a similar facility set up to encourage tea exports.

Last year, over 15 producers exported 45 million kg of tea into the DMCC Tea Centre and sold them to different countries.

Of the overall exports, Indian companies accounted for 4 million kg, Sashittal told BusinessLine.

Apart from India, other major countries which tapped into the Dubai Tea Centre include Kenya, Sri Lanka, Indonesia, Malawi, Rwanda, Tanzania, Mozambique, Vietnam, Japan, Uganda, and China. In fact, shipments from the DMCC Tea Centre accounted for 65 per cent of global tea trade.

A dedicated tea tasting centre allows companies to blend different flavours for different countries. DMCC itself has created its own tea brand ‘Shay Dubai’, by blending different teas available at the Tea Centre.

It is also exploring similar dedicated centres for other commodities which have a global market.

A government body, DMCC charges 950 AED (Arab Emirates Dirham), or about ₹16,770, for loading and unloading a 40-foot container.

It provides free storage space for bulk teas up to 45 days and another 21 days of warehousing space is given for preparing value-added finished products. Beyond 66 days, it charges a warehouse fee of AED 1.42 per tonne per day.

DMCC also helps companies raise finance against the receipts issued for goods stored at the warehouse.

In a bid to bring down costs, it is exploring the possibility of introducing shared-services, a concept popular in the IT industry.

Though they are competing with one another, companies can share some of the services such as quality testing, grading and packaging, said Sashittal.

Over 2,000 Indian companies, including the Tata Group, UPL Group, Rosy Blue, Adani Group, Blue Star and McLeod Russell, have already established their presence in DMCC to grow their export business.