Arabica coffee prices are staging a comeback, tracing the global uptrend bringing relief to coffee cultivators in the prime growing regions of Karnataka. The harvest, initially underway in some areas, now faces delays due to inclement weather hampering the crucial coffee drying process.
Recovery in Arabica Prices, Yet to Reach Peak
The President of the Coffee Exporters Association acknowledges the recovery in Arabica prices, though they have yet to reach last year’s highs. Experts further opine that the price recovery is a boon for the new crop. Slow arrivals, attributed to delayed drying due to bad weather, have been a challenge.
A Timely Boost for High-Cost Arabica Cultivation
The current price rebound is a much-needed respite as the cost of Arabica production hovers around $1021,79 or € 932,08 per acre, and yields have dwindled to an average of around 350 kg per acre, as voiced by farmers. Buoyed by price recovery and sluggish arrivals, some growers may exercise prudence, holding back their produce in anticipation of better prices.
Growers will hold back when the market rebounds and wait for better prices, given the high cost of production. Depending on their holding capacity, some growers may hold back their produce, as per the market reports.
Weather Impact on Arrivals And Statistical Snapshot Of 2023-24 Projections
While the Arabica crop looks promising for 2023-24, with lower elevations witnessing ongoing harvesting and higher elevations yet to commence picking, the arrivals face a delay of about 15-20 days due to adverse weather conditions hampering the harvest process.
For the ongoing 2023-24, the Board’s preliminary estimates foresee an output of 3.74 million tonnes, including approximately 1.13 million tonnes of Arabica and 2.61 million tonnes of Robusta. In comparison, the final forecast for 2022-23 revealed Arabica production at 1 million tonnes and Robusta at 2.52 million tonnes, totaling 3.52 million tonnes.
Arabica prices rebound in a robust coffee commodity, offering respite to Karnataka’s growers. Acknowledging recovery, the Coffee Exporters Association President notes prices are yet to peak. The timely boost aids high-cost Arabica cultivation, relieving farmers facing production challenges. Market movements suggest growers may strategically withhold produce for better prices. Weather-induced delays impact arrivals, promising a delayed but promising harvest. Board projections for 2023-24 forecast 3.74 million tonnes of output, including 1.13 million tonnes of Arabica and 2.61 million tonnes of Robusta, showcasing a positive trajectory for the coffee industry.