The current crisis has jeopardized Indian coffee exports to Ukraine and neighboring countries, the Coffee Board said on Friday.
So far (April-January) this fiscal year, India had exported 6,604 metric tons of green, instant, roast and ground coffee to Ukraine and 23,519 metric tons to Russia. In fact, coffee exports to Ukraine peaked at 7,327 metric tons in the 2018-2019 financial year, and in 2019-2020 it was 6,947 metric tons.
The CIS countries were traditionally the major importers of soluble/instant coffee from India. Russia currently accounts for 75%, while Ukraine alone holds more than 20%, according to data shared by the Coffee Board. w
“The Russian-Ukrainian war will certainly impact Indian coffee exports to Ukraine and its neighboring countries,” said Dr. KG Jagadeesha, CEO and Secretary of the Coffee Board.
According to coffee exporters, apart from the immediate impact on exports, the war could also have an indirect and long-term impact on India’s overall coffee exports to Ukraine and neighboring coffee markets.
“The Russian-Ukrainian war is likely to drive up the prices of fuel, metal/aluminum (soluble coffee is mainly exported in cans and metal containers) and packaging materials. It could also drive up logistics costs,” said Ramesh Rajah, president of the Coffee Exporters Association. “That means the overall cost of exporting is definitely going to go up and buyers and sellers are already worried about that,” he said. “Furthermore, all this is happening when the prices of packaging raw materials had already risen by 30% recently,” Mr Rajah added.
Ukraine is one of the biggest importers of coffee in this region, while Russia is one of the top 5 buyers of Indian coffee. “Although Ukraine is largely a tea-consuming country, it has a very mature coffee culture, thanks to Turkish and Ottoman influence,” he said. “The current uncertainty is certainly of concern to both exporters and importers of all varieties of Indian coffees,” he added.