Commodity Market news- Plunge in global Arabica prices cripple India’s exports
India’s coffee exports are likely to remain inactive in the last quarter of the fiscal year, due to low global prices and an expected slump in the Arabica crop.
Global prices are likely to remain subdued as Brazil, the largest coffee producer, is expecting a bumper crop which is close to 60 million bags (each of 60 kg) in 2019. Production in Vietnam, the next biggest producer, is also predicted to be a good one.
As per the Coffee board data, shipments of Arabica Coffee showed a 13 percent fall at 2,32,080 tonnes in the current fiscal year which started on April 1 to December 10. In 2017-18, the country had posted a 12 percent increase in exports.
Prices of Indian Arabica are hovering at Rs 7,000 per 50 kg. This is below the cost of production for the growers, which is pegged around Rs 8,000. Shipments for the next few months will depend on whether the growers will sell at a lower price.
Meanwhile, the Arabica coffee harvest in India has started and growers expect a lower crop.
Arabica production in the country was around 95,000 tonnes last year as estimated by the Coffee Board. Growers fear it could be down by around 15,000 tonnes this time.
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