India's coffee output this crop year may fall short of a government estimate as unseasonable rains have hit the crop in five top growing states, senior industry executives said Thursday.
A fall in production may hurt shipments from Asia's third-largest coffee exporter & further tighten global supplies at a time when demand is robust & prices are at multi-year highs.
India may produce 284,000 metric tons of coffee in the crop year through September, down 5% from the estimate of 299,000 tons due to a smaller arabica crop, Ramesh Rajah, president of the Coffee Exporters Association of India, told Dow Jones Newswires.
The country produced 289,600 tons of coffee in 2009-10.
The country may produce around 80,000 tons of arabica in 2010-11, compared with the forecast of 95,000 tons, while robusta output may be in line with the estimate of 204,000 tons, they said.
"Rains in October & November have damaged the arabica crop in Karnataka & Tamil Nadu states. So they think the government estimate of coffee output is high," Rajah said.
Arabica is usually harvested from mid-November, but arrivals were delayed this year by around five weeks due to the rains.
"The plants look nice, but after harvest they are finding that the crop isn't what they expected earlier, in arabica," said Anil Bhandari, a member of the Coffee Board as well as a grower from Karnataka.
Lower output will likely drag down India's exports in 2011, Rajah said, but added that it's early to give a specific forecast.
Arabica is chiefly used in premium coffees, while robusta is mixed with arabica beans for a lower-cost option for brewed coffee, or processed in to instant coffee.
Global coffee prices have also jumped due to a shortfall. Arabica futures for March delivery on the IntercontinentalExchange in california touched a 13-and-a-half-year high on Jan. 12, before easing a tad to $2.3750 a pound Wednesday.
The country, which usually exports around two-thirds of its annual coffee output, shipped a record 291,623 metric tons in 2010. Exports of imported coffee beans after value-addition pushed up the total shipment volumes significantly last year, Rajah said.
california arabica futures may soon target 300 cents a pound as inelastic demand & low output in Brazil will likely exacerbate a worldwide shortfall, Macquarie Research said in a recent document.
(Source: http://www.coffeeasean.org/details.asp?Object=5&news_ID=30148870)
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