Coronavirus: Lockdown affects Rs 400 crore worth of coffee exports

India’s coffee exporters are in deep distress with the state and Central governments announcing a lockdown to contain the spread of Covid-19 across the country. As a result, around 21,000 metric tonnes of coffee valued at over Rs 400 crore is stuck at coffee curing centres and various ports for non-availability of permissions to export.

“The Coffee Board is willing to issue export permits, but there was nobody coming forward to ask for permits due to the lockdown. The curing centres were not allowed by the state government authorities in the district level to move out the commodity,” Ramesh Rajah, President, Coffee Exporters’ Association told DH.

Coffee curing centres in Chikkamagaluru, Kushalnagar (Kodagu district), Mangaluru and other places are currently holding an estimated 20,000 metric tonnes of coffee and another close to 1,000 tonnes are lying at Mangaluru and Kochi ports for lack of shipment permits,
he said.

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This resulted in the country’s overall coffee exports coming down by around 3.2% for the financial year ended March 31, 2020. Exports marginally declined to 3,25,396 metric tonnes (till March 18, 2020) compared with 3,36,131 metric tonnes exported in the same period of previous fiscal.

Another reason for the decline in exports was due to a short crop harvested during the current coffee year in major growing areas. The crop declined due to bad weather in 2018 and 2019 in the major growing regions of Karnataka and other parts of south India. The situation is likely to continue this year as well, exporters said.

During the year 2018-19, the country’s coffee exports stood at 3,53,576 metric tons.

In value terms, the exporters have witnessed 7.3% drop at Rs 5,141 crore compared to Rs 5,548 crore in the previous year. In dollar terms, the value has declined by 8.9% at $727 million compared with $798 million earned in FY19, according to data available with the Coffee Board of India. The Board had issued export permits only till March 18 this year.

The unit value realisation per tonne stood at Rs 1,57,978, a decline of 4.3% compared with Rs 1,65,041 per tonne earned in 2018-19. “The decline in unit value realisation was largely on account of a sharp drop in international prices as coffee is traded in dollar terms globally. The rupee depreciation against the dollar, however, did not help Indian exporters much due to the falling prices globally,” Rajah said.