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Coffee prices have declined around 5.5 per cent to settle at 187-189 cents per lb (pound), as Brazil reported good blossom showers. Bean prices on the New York terminal are currently ruling at 189 cents per lb compared to 198 cents per lb about three weeks ago.
Reflecting the global trend, farm gate prices of Arabica Parchment have also shown a decline and ruling at 11,000 per bag (each bag is 50 kg). The decline is about 10 per cent compared to Rs 12,300 per bag a year ago. Arabica harvest is currently going on in major growing regions in Karnataka.
“Brazil has reported good showers in the last few days and the fear of lower crop for 2015-16 have come down. Though it is too early to predict the crop size in Brazil, the prices have moved on the lower side on the New York terminal,” said Ramesh Rajah, president, Coffee Exporters’ Association.
LIFFE January robusta coffee futures settled down $22, or 1 per cent, at $2,074 a tonne, Coffee Board said.
However, the price decline is not as steep as it has been in the case of many other commodities globally, he said, adding the realistic picture on Brazilian crop size for next year would be known by January 2015.
Analysts have pegged the Brazilian crop at around 47 million bags (each bag is 60 kg) for 2015-16, which is much lower than the 2014-15 crop.
“We have been hearing contradictory reports on the Brazilian crop. Due to good rains and even floods in some parts of Brazil, prices have come down. The farm gate prices in Kodagu are now quoted at Rs 11,000 to 11,150 a bag. However, the situation is better due to lower Arabica crop,” said Bose Mandanna, former vice-chairman of Coffee Board.
He said Arabica crop is likely to be lower by at least 20 per cent this year due to severe attack of white stem borer pest across the growing regions. The pest attack has been severe up to 3,500 feet elevation in Kodagu.
“We are shocked to see that most of the plantations have reported lower pickings. The daily average picking per person has dipped from 80-100 kg last year to around 55-60 kg per person per day this year,” Mandanna added.
The state-owned Coffee Board has pegged the 2014-15 bean production at a record level of 344,500 tonnes with Arabica output at 105,500 tonnes and Robusta output of 239,000 tonnes, which is about 13 per cent more than last year's final production of 304,500 tonnes.
