Outlook for coffee demand looks bright

Consumption of coffee in India is growing steadily. In 1954, domestic consumption was 18,400 tonnes. From then it has grown at an annual rate of 2.2 per cent to reach 94,400 tonnes during 2008. The growth was much faster in the recent years, showing an annual average rate of 5.86 per cent between 2000 to 2008. India’s coffee output for 2009-10 (October-September) is projected at 300,000 tonnes. Going by the present trend, 32-35 per cent of this is for home consumption and the rest for exports.

For the coffee industry in India, growth in domestic consumption is desirable, as it results in healthier and stable market conditions. Over the past few years, coffee has changed from being a traditional beverage consumed mainly in South India, to a beverage with a national presence, consumed in several forms and retail format. During a presentation at the International Coffee Festival (IICF-2009) here on Thursday, Roop Rashi, director (Finance), Coffee Board of India said, “The long-term outlook for coffee demand continues to be bright, mainly due to the growth of niche market in mature markets and the addition of new consumers in emerging markets.”

 

Domestic consumption in other exporting countries, in particular, Brazil, Mexico and Indonasia has also gone up over the years. Consumption has increased in consuming countries too, mainly Germany, Italy, Spain and United Kingdom.

Experts participating at the three-day event stressed on the fact that while demand outlook is satisfactory, there is an urgent need to increase productivity of coffee in India. Improving on the quality and productivity front will make the country more competitive in the global markets, they maintained.