What's New :
Gist of ECONOMY SURVEY 2022-2023 Download PDF
Summary and Analysis of Union Budget 2023-2024 Download PDF

A crisis is brewing in the coffee industry

  • Published
    22nd Oct, 2022

Context:

Coffee cultivation is becoming an increasingly loss-making proposition in India. In addition to high input costs & labor shortages, changes in climate patterns are also affecting the industry.

The destruction caused by Rain patterns

  • Damage due to Erratic weather conditions: The plantation in Kerala, Karnataka, and Tamil Nadu has been devastated by recent heavy rains and dry spells between 2015 and 2018.
  • Need for weather-resistant Varieties: Heavy rainfall and landslides have resulted in infruit rot, stalk rot, and root rot. Sturdy and weather-resistant varieties of coffee may provide a solution.

Cost of financing and weak Infrastructure:

  • Producers are getting marginalized: The market is rapidly turning out to be a buyer-driver and producers are losing their influence.
  • Cost of Financing: The lending rates are at around 12%, which is too high compared to single-digit rates in other countries. Small growers are often left with little money to repay loans.
  • Higher cost Irrigation: Frequent power cuts and increasing cost of diesel make the irrigation activity costlier. There is a need to work on developing a reliable infrastructure.
You must be logged in to get greater insights.
X

Verifying, please be patient.

Enquire Now