Acpc May Not Decide On Coffee Export Quotas
The 14-member Association of Coffee Producing Countries (ACPC) is unlikely to take a decision on export quotas at London this week during a review of its 12-month export programme ending next month, according to industry sources. The association was expected not to decide on the quota primarily fearing a consumer backlash in the wake of global coffee prices touching a 20-year high last week, the sources said.
Coffee prices for the premium arabica variety touched a peak of $2.79 for a pound for May futures on May 15, though it eased a bit the following day.
Coffee prices at various global retail outlets have increased by 20 per cent, including India, while French and British coffee consumers were the latest to suffer the price hike.
According to the sources, the opposition to decide on the quota was expected from some of the countries led by Indonesia, world's third largest coffee producer. Reports from Jakarta quoted Indonesia's representative to the ACPC, Paian Nainggolan, as saying on May 16 that the association should demonstrate it was not a cartel by taking into account the interest of consumers.
A technical committee meet and a full council meeting of the ACPC is slated to be held at London from May 19-23. The coffee board chairman, Philipose Mathai, is India's representative in the association. Earlier, the association had planned to cap the exports by the producing countries at 15.28 lakh tonnes during the first half of 1997-98 crop year. In January last, ACPC had decided to cut the exports by 78,000 tonnes but during a meeting in March, it decided to export an additional 30,000 tonnes.
The ACPC decided to cap the exports mainly in view of low prices for the commodity last year but the price hike this year, especially in view of major producing countries reporting poor production, has touched off a raw nerve.
Production in India, too, has been low with the coffee board estimating it to be 2.05 lakh tonnes and the growers 1.94 lakh tonnes. The trade has, however, put the figure at 1.8 lakh tonnes.
According to reports from Bogota, quoting exporters, coffee future prices soared to a 20-year high on May 15 after Colombian exporters said their country's crop would be much lower than official estimates.
Due to heavy rains, production in Colombia, the second-largest global producer, is expected to be 5.7 lakh tonnes against a normal production of 7.8 lakh tonnes.
Reports from Brazil said though the country's crop has now been estimated to be 14.4 lakh tonnes, which is higher than previous estimates, it is still considered to be lower than a demand of 16.8 lakh tonnes for both exports and domestic consumption.