Kochi: Indian coffee growers are witnessing a rare period of financial optimism as global supply shortages push coffee prices to new highs. The primary factors include production declines in major coffee-producing nations like Brazil, Vietnam, Mexico, and Colombia. This marks the first time in 15 years that coffee farmers in India, especially in Karnataka and Kerala, are benefiting from such favourable price trends.
Brazil, the world’s largest coffee producer, has faced a significant setback due to severe drought conditions exacerbated by the El Niño weather phenomenon. Arabica coffee, which constitutes the majority of Brazil’s output, is particularly vulnerable to climate fluctuations because of its smaller plant size. Estimates for Brazil’s Arabica production for the 2025-26 season have been slashed to 344 lakh bags, each weighing 60 kilograms, reflecting a sharp 25% decrease from earlier predictions. For the 2024-25 season, production is estimated at 433 lakh bags, still insufficient to meet rising global demand.
Winter festivities, including Christmas and New Year celebrations, typically boost coffee consumption, further driving up prices. However, the global shortage poses challenges for Indian farmers as well. Kerala has reported a 40% drop in coffee production, despite attractive rates for Robusta coffee. Current prices in Central Kerala range from Rs 60 per kilogram for raw coffee to Rs 225 per kilogram for hulled beans and Rs 390 per kilogram for berries.
While Karnataka accounts for a larger share of India’s coffee cultivation, growers there are also struggling with climate-related challenges. The reduction in global coffee availability offers opportunities for Indian farmers to benefit from higher prices, but sustained production issues remain a concern for the long term.
