With domestic coffee brands increasing prices by as much as 20% over the last 12 months and with further hikes anticipated in the wake of a 39,616-tonne shortfall due to a combination of a smaller crop and higher exports this year, sections of the industry see a reduction in the unviable 100% duty on imported beans as a solution which could benefit not just the hard-hit consumers but also the growers. In 1994, when coffee bean prices reached historically high levels following a frost in Brazil, the commerce ministry reacted in a kneejerk manner by immediately banning export of certain grades and placing curbs on shipments of others. How ever, no instant relief was provided to growers when bean prices later fell to their lowest levels in the wake of a global surplus.

Anil Bhandari, the Coffee Board member representing large growers, says the more sustainable solution if prices keep going up over the next few months would be to continue to allow the shipments of premium export grades like Washed Arabicas and Washed Robustas while lowering the import duty on cheaper bean varieties which are drunk by larger sections of consumers. This, he says, is the best way of ensuring the sustainability of Indian roasters and the continued growth of domestic consumption to a level where growers are less vulnerable to the intense volatility in world prices for coffee beans.

Leading Karnataka coffee roaster Cothas Prakash says a cut in the 100% duty on imported beans would not just keep domestic roasters in business but also provide for a more aromatic and better-tasting cuppa coffee. "I have personally sampled coffee beans from other countries and have found that even if blended with Indian beans in the ratio of one as to five, the net result is a better cup of coffee."

Coffee Board trade-member Harish Bijioor feels that a cut in the import duty on beans is just part of the solution. "What is literally adding fuel to the price-rise fire is the fact that coffee is a very transport-sensitive commodity. There are six stages from the bean to the cup. Given the spiralling prices of petrol and diesel, the movement by road at each stage has a cascading effect on the overall price," he adds.

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