With Euro zone debt crisis and economic slowdown in the West resulting in the fall in demand, India is looking at Japan and South Korea as the future destinations for its coffee exports.
Coffee exports during 2011-12 are likely to fall to 2.4-2.5 lakh tonnes from 2.94 lakh tonnes in the previous year. The projected decline of 15-18 per cent is mainly on account of sluggish demand from the Euro zone debt crisis, one of the major destinations for about two thirds of India’s coffee exports.
"We are now concentrating on tapping new markets and popularising Indian coffee in Asia especially Japan and South Korea,’’ Coffee Board of India Chairman Jawaid Akhtar said.
At present, Japan and South Korea and not among the major importers of Indian coffee but the Coffee Board feels there is tremendous potential for exports to these countries.
Mr. Akhtar acknowledged that exports to European destinations are on the wane due to the debt crisis in the region and there was an urgent need for India to scout for new exports destinations to make up for the reduction in overseas shipments.
However, the Coffee Board expects coffee output in the country to increase in the 2011-12 crop year (October-September) in comparison to the previous season. "The board has estimated the 2011-12 crop size at 3.21 lakh tonnes, as against 3.01 lakh tonnes in the previous year, on the back of an increase in the Arabica variety," he said.
Arabica production is expected to be around 1.04 lakh tonnes in 2011-12, as against 94,000 tonnes in the previous year, while Robusta output is projected to rise to 2.17 lakh from 2.07 lakh tonnes in the same period a year ago. The crop this year is backed by good rains across the main growing regions of Karnataka, Tamil Nadu and Kerala. Besides, the expansion of crop in non-traditional areas of Andhra Pradesh and Orissa is adding up to the output, he said.
Stating that domestic demand for coffee had also gone up tremendously, Mr. Akhtar said the country needs to increase its production in order to deal with exports also. While domestic consumption was a meagre 2 per in 2000, it is growing at a rate of 6 per cent per annum since 2003. India consumed 1.08 lakh tonnes of coffee in 2010, he said.
He said Coffee Board had identified 22,000-23,000 hectares of land in Andhra Pradesh and 20,000 hectares in Orissa for cultivation of coffee beans.
Presently coffee is grown in 3.88 lakh hectares across the country, with Karnataka, Kerala and Tamil Nadu considered traditional cultivation areas, while Andhra Pradesh and Orissa are non-traditional areas.
The Coffee Board is also holding the India International Coffee Festival, 2012, in Delhi from January 18 to 20 and will see the participation of 500 delegates from 16 countries.