Market Uplift Observed
A notable surge in Robusta coffee prices has been seen. This development is warmly welcomed by growers. It’s reported from Bengaluru that this increase has occurred at a crucial time. Currently, the harvest season is at its halfway point. Consequently, a sense of joy among producers is evident. Global trends are being mirrored by this price rally. In Europe and the Red Sea region, stockpiles are seen increasing. Supply chain disruptions are being outstripped.
Price Peak Reached
Unprecedented highs in prices for Robusta coffee cherries have been recorded. In Karnataka, prices have soared to between $85.80 and $90 (€79,40 – €83,25) per 50kg bag at the farmgate. This represents a 62-63% increase from last year. Moreover, Robusta parchment coffee has reached $145,20 to $148,80 (€134,41 – €137,74), up by 36-37%. On the other hand, Arabica parchment shows a slight decrease compared to last year. However, Arabica cherry prices have risen by nearly 10%, reaching $94,80 to $97,20 (€87,74 – €89,87).
Challenges Highlighted
Increased production costs have been highlighted by HT Mohan Kumar, president of the Karnataka Growers Forum. A shortage of labor is being faced. As a result, coffee picking costs have nearly doubled. Initially, costs were around $0,036 to $0,048 (€0,033 – €0,044) per kg. Now, they have escalated to $0,072 to $0,084 (€0,067 – €0,078) per kg. An intensification of this labor shortage is anticipated. The reason is the simultaneous harvesting by everyone.
Export Dynamics
The situation for Indian coffee exports has been described by Ramesh Raja, president of the Coffee Exporters Association. A strong demand for immediate shipments is present. However, a full advantage cannot be taken by Indian exporters. The reason is the anticipation of higher prices by producers. Thus, market arrivals are being slowed down. Additionally, supply chain disruptions have caused delays. Shipments to Europe are being delayed by 10-15 days. Consequently, shipping costs per container have risen by $1,500 to $1,800 (€1,389 to €1,667). An increase in transit time from 30-35 days to 45-50 days has been observed.
Demand for Robusta Strong
A 29-year high for robusta prices has been reported. This is due to supply chain problems and low stocks. An increased use of robusta in blends by roasters has been seen. Therefore, a good demand for robusta coffee remains. Roasters are purchasing as needed.
This overview reflects the current state of the coffee market. Influenced by global trends and local challenges, the dynamics are complex. As the season progresses, the industry’s response remains to be seen.
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