Agri Commodities

Indian Coffee Production and Global Market

Indian Coffee Production and Global Market

Coffee is one of the world’s most traded Agri-commodities. It is grown in 80 countries and exported by more than 50, with most of them based in Central and South America, Africa, and Asia.

More than 25 million coffee farmers from the emerging nations are primarily small-scale producers. Coffee production and processing employ over a hundred million people. Productivity has a huge influence on the economic growth and ecosystem of the producing regions.

If we particularly talk about India, it is grown in several Indian states, primarily in mountainous locations.

Indian coffee is well-known for its lovely fragrance and mild acidity. Unlike South American coffees, the sour flavor is less apparent in the Indian coffee variant.

Some Indian coffee beverages contain a quiet cocoa fragrance.

What are the Features of Coffee Cultivation in India? 

Industrial farms and individual landholdings are responsible for coffee cultivation in India.

Coffee is produced in areas with 2,500-4,000 mm rainfall for more than 100 days followed by an equivalent period of dryness.

Coffee production in India is driven by the hilly areas of South Indian states, with Karnataka contributing 71%, Kerala accounting for 21%, and Tamil Nadu accounting for 3%.

Indian coffee is considered to be the best coffee in the world as it grows in the shade instead of bright sunlight.

Karnataka dominates the coffee sector, accounts for more than half of exports, followed by Andhra Pradesh.

Coffee is the world’s second most freely traded product, after petroleum as the majority of coffee producing and exporting nations are underprivileged, while coffee importing nations are prosperous.

Coffee represents a product with the potential to reduce the economic imbalance between these nations.

There are several types of coffee plants, including Arabica (Arabian coffee) and Robusta (Congolese coffee) in India.

Arabica and Robusta plantations cohabit in India. However, Robusta trees are given a higher yield — nearly half — in India thus, Arabica’s export share is just 30%, with the balance being Robusta.

Arabica is the most common type of coffee plant in India. However, due to the sensitivity of these plants to various diseases, it was later decided to plant Robusta, brought from Java, and hybrid varieties.

Robusta coffee, particularly the famous India Robusta cherry, is widely admired by Europeans for its robustness and delicate flavor. Robusta is ideal for blends.

The Monsoon Malabar is the most popular Indian coffee all over the world.

Indian Coffee in Global Market:

In the coffee market, India’s annual coffee output is rising to allow the nation to rank sixth among the world’s major coffee producers. India exported up to 80% of its coffee bean production, accounting for 4% of the world coffee market.

  • India is the world’s sixth-largest producer and fifth-largest exporter of coffee.
  • It is the third-largest coffee producer in Asia.
  • It accounts for 3.14 percent of world coffee output (2019-20).
  • Indian produced 299,300 million tons of coffee during 2019-20.

According to a report by global trade finance business Drip Capital, India exported approximately $720 million worth of coffee in 2020-21, with Robusta coffee beans accounting for 42% of total exports (DGFT).

Coffee Exports from India:

Coffee exports from India were US$ 738.86 million between April 2019 and March 2020.

From April 2020 through March 2021, total coffee exports totaled US$ 719.50 million, with a March 2021 total of US$ 97.41 million.

Coffee exports totaled $71.46 million in April 2021.

India exports Seventy percent of its coffee produce in India while thirty percent is consumed locally.

According to the study, Italy is India’s most important market, accounting for more than 20% of all bean coffee exports. While Arabica coffee is exported to the Middle East, Europeans prefer the stronger and caustic flavors of the Indian Robusta variety.

In addition, Russia, Poland, the United States, Turkey, and Malaysia purchased over half of all coffee preparations manufactured in India in FY20, totaling nearly $141 million.

India is now the third-largest supplier of coffee preparations to Poland; Indian exporters should continue to focus on gaining a major market share in Poland and the United States for instant coffee.

India’s coffee exporters can expand their niche in the global coffee market with a little value addition and assistance from the Coffee Board and the government.

The Coffee Board of India conducts research, development, extension, quality enhancement, and local and international promotion of Indian coffee. The board has organized the India International Coffee Festival, a biannual event conducted in India in conjunction with other industry players, since 2002.

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