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India slips to 7th spot globally in coffee production

Tuesday October 02, 2012 05:11:12 PM, Fakir Balaji, IANS

Coonoor (Tamil Nadu): Even as India remains upbeat on surging demand for its coffee beans in the global market, its planters have reasons to worry as their share in the world production slipped to seventh position in 2011-12.

"With four percent (5.3 million bags of 60 kg) share of world production, India slipped to seventh in this coffee year (Oct-Sept) from sixth in 2010-11, as Peru in Latin America climbed up with 4.1 percent share (5.4 million bags)," a leading planter told IANS here.

New players like Vietnam (second) and Indonesia (fourth) in southeast Asia and smaller countries like Ethiopia (fifth) in Africa have also overtaken India in production, thanks to their geological and climatic advantages and state incentives.

"Rich volcanic soil, favourable weather conditions through the year, availability of water and lower production costs have enabled these smaller countries remain ahead of India despite four percent increase in our production in 2011-12," Karnataka Planters' Association (KPA) chairman Marvin Rodrigues said on the margins of a conference.

Though India's production grew marginally to 5.33 million bags in 2011 from 5.03 million bags in 2010, registering 5.9 percent year-on-year (YoY) growth, Peru had a whopping 33 percent YoY growth to 5.4 million bags from 4.06 million bags in the same period.

In spite of 13 percent YoY decline to 6.5 million bags from 7.5 million bags in the like period, Ethiopia remained fifth while Vietnam stood (second after Brazil) with 21 million bags and Indonesia fourth (after Colombia) with 8.3 million bags.

"Our production cost is also higher than these countries due to increasing wages, mandatory social costs like providing housing, healthcare and provident fund to the work force, rising overheads like fuel hike and state taxes/levies," Rodrigues noted.

According to the International Coffee Organisation (ICO), global production, however, declined 1.6 million bags to 132.7 million bags in 2011 from 134.3 million bags in 2010 (-1.2 percent YoY) due to 'off-year' in South American countries in the biennial cycle characterising the Arabica (bean variety) yield.

"Brazil remained top despite 9.5 percent YoY decline in production to 4.35 million bags in 2011 from 4.81 million bags in 2010. Vietnam continued its surge in production with intensive irrigation and heavy use of inputs and fertilisers," United Planters' Association of South India (UPASI) spokesman R. Sanjith told IANS at the recent two-day 119th annual conference of the commodity planters here.

World production this calendar year (2012), however, is projected to be higher at 148 million bags, as it will be an 'on' year in Brazil and is expected to produce over 50 million more of Robusta and other milds, including Arabica.

Domestic production (post-blossom crop) is projected to increase 3.6 percent to 325,000 tonnes in 2012 from 314,000 tonnes in 2011, with 104,000 tonnes from Arabica and 221,300 tonnes from Robusta. (One tonne is equivalent to 17 million bags of 60 kg).

"Production in India is poised for highest growth ever, thanks to a well-distributed rainfall in 2011, which helped in moisture retention for longer period. The blossom showers (in April/May) across coffee growing zones also helped in posting record growth," Sanjith stressed.

Citing a Food and Agriculture Organisation (FAO) report, Rodgrigues said Indian productivity at 826 kg per hectare was a cause for concern as it is below even Vietnam, which had a yield of 2,150 kg per hectare and Brazil 1,333 kg per hectare in 2011.

"We need to do a lot more at the policy level and farm level as higher production cost, including increasing wages and social benefits, makes us less competitive in the international markets," former UPASI president D. Hegde observed.

Grown mostly in the developing countries and consumed more (about 70 percent) in developed countries like the US and Europe, coffee is the second largest commodity traded worldwide, with 100 million people engaged in the chain from cherry to cuppa.







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