Explained: Coffee Price Crash – Here's Why Indian Growers Are Worried
- Saritha Devaiah Ballachanda
- Jun 16
- 2 min read
A sharp drop in global coffee prices has sparked concern among Indian coffee growers, especially in Karnataka’s major producing regions like Kodagu, Chikkamagaluru, and Hassan. While earlier high prices encouraged farmers to hold back stock, the recent downturn now threatens their earnings.
After months of strong prices, global coffee markets are witnessing a sharp correction, raising concerns among Indian growers. Since the start of May, robusta futures have fallen by 17% and arabica futures by 15%, mainly due to improved production prospects in major coffee-producing nations including Brazil, Colombia, Honduras, Peru, Vietnam, and Indonesia.
“The robusta harvest has begun in Brazil, Indonesia and Uganda (Fly crop), increasing supply. At the same time, speculators are exiting their positions, adding to the downward momentum,” said Praveen Kolimarla of Agrani Coffee and Commodities told The Hindu Business Line. “While prices are still historically high, the trend suggests they could fall further before stabilising.”
Is Holding Back Coffee Now Hurting Indian Growers?
For Indian growers, this development brings mixed fortunes. Earlier in the year, prices were on the rise, and many farmers held back their produce, hoping for even better rates. “It appears that farmers have sold a smaller proportion of coffee than usual for this time of the year,” Kolimarla noted.
That strategy may now backfire. If prices continue to slide, growers who held their stock might earn less than those who sold earlier. Moreover, Indian export demand has also dipped recently. “A month or two ago, Indian differentials were very attractive, and there were good sales. But now, differentials have climbed again and global buyers are less interested,” he added.
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Will Karnataka’s Coffee Belt Feel the Heat?
On the positive side, export permits that were lagging earlier have now caught up, allowing traders to move more volume overseas. But unless prices bounce back soon, the current scenario could dent farmer incomes and sentiment in the coming months.
India is the world’s sixth-largest coffee producer, with Karnataka accounting for over 70% of the country’s total output. Kodagu also known as Coorg, Chikkamagaluru, and Hassan districts are the key coffee-growing regions in the state. Kodagu alone contributes more than one-third of India’s coffee, predominantly robusta, while Chikkamagaluru and Hassan grow both arabica and robusta varieties.
In 2023–24, India produced around 3.74 lakh tonnes of coffee, with robusta making up nearly 72% of the total. The majority of Indian coffee is exported, making global price fluctuations critical to farmer earnings.
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Good report from Karnataka, 15-17 % Coffee price crask, but From which rage, nothing mention about price, what is it