India's coffee exports might drop 5.6% this year: USDA

India's coffee exports are likely to decline 5.6 per cent to 4.7 million bags, in the ongoing marketing year ending in September, due to weak demand from major European buyers, a US Department of Agriculture (USDA) report said.

The country had shipped 4.98 million bags of coffee during the 2013-14 marketing year (October-September). One bag contains 60 kg of coffee.

According to the USDA report, India's Robusta coffee variety has a good reputation among international buyers. European countries continue to be the major buyers of Indian coffee.

Italy, Germany, and Russia are the top export destinations for Indian coffee. India exports an estimated 90 per cent of its production.

India's actual exports are virtually equivalent to production, but include one million bags of coffee that are imported duty free for processing and re-export under a special re-export programme, said the report.

On prices, the USDA report said average Arabica coffee variety prices at the International Coffee Organisation (ICO) indicator have fallen 15 per cent between January and March while Robusta prices have remained firm.

Domestic prices are largely driven by international prices and trade sources indicate that global supplies of Robusta are keeping prices at lower levels.

"Robusta prices are expected now to remain firm until the onset of the next harvest as strong foreign demand pressures Indian supplies," the report said.

According to the Coffee Board data, the major shipment ports for coffee in India are Mangaluru (Karnataka) and Cochin (Kerala) ports followed by Chennai (Tamil Nadu) in Southern India.

India's overall coffee production is estimated to be slightly higher at 5.1 million bags in 2014-15 marketing year, as against 5.07 million bags in the last year.