Indian Coffee Community Bounces Back

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Even as India’s coffee producers struggle with long-standing challenges – labor shortages, erratic weather patterns, and uncertain prices – the

positive developments, especially after a bullish year, have brought optimism.

India ranks 6th among the world’s coffee producers, growing both arabica and robusta. About 70% of the total crop is exported, with greens roughly split between 30% Arabica and 70% Robusta, according to Mercanta. Until the 1990s, coffee was pooled and sold by the Coffee Board. Today, coffee is traded in a free market.

Beyond the traditional coffee growing areas in the south – Coorg, Chikmagalur, Wayanad – the non-traditional areas further east – Odisha, Andhra Pradesh, and Nagaland, among others – are playing significant roles in adding to what Indian coffee has to offer as varieties.

In 2023, India saw high production (expected to surpass 352,000 million metric tons, up 4.5% in 2022-23) and record export earnings of $1.2 billion. Export volume declined by 5.4% compared to 2022 due to a 15% decline in robusta exports to 187,000 metric tons, down from 220,000 mt in 2022. Traditional markets of Europe remained strong, with emerging interest from North America, Australia, Japan, South Korea, and Scandinavia. In December 2023, Hyderabad-based Roastery Coffee House held a 3-day pop-up in Helsinki (chosen as Finland has the highest per capita consumption of coffee in the world). Indian specialty coffee – particularly the Monsoon Malabar – gained new fans, and Roastery is set to become the first Indian café chain to open in the Nordic in March 2024. Happily enough, Indian coffee is also enjoying a surge in interest in the domestic market.

Growth of the domestic market

For many years, Indian coffee was made almost exclusively for export. Domestic consumption was largely confined to the southern states. Today, the domestic market is seen as an important segment, with unofficial numbers placing it at 20%. One reason has been increased access to out-of-home consumption of coffee for consumers. India, on average, consumes about 30 cups of coffee per year. In comparison, the global average is about 200 cups. New cafes and roasters are playing the part of educators and guides. While the volume of coffee bought by cafes is still growing, their role in promoting coffee is acknowledged. They have allowed producers to create an identity for their coffee, including them in this journey to promote Indian coffee. The coffee board has responded with a training program for baristas. Another program, ‘Know your Kaapi,’ introduced last year, invites growers to submit their coffees for cupping with the best coffee fetching honors.

For consumers, greater brewing and drinking options have made coffee an attractive lifestyle choice. Choices abound. In addition to single estate and single origin coffees, new coffees, whether cold brew, cascara, or coffee kombucha, and non-traditional brewing methods add to its appeal. Younger coffee drinkers are adventurous and willing to experiment and spend on good coffee.

Abhinav Mathur of Kaapi Machines and Something’s Brewing says, “Two years ago, there were 1-2 coffee brewing clubs in India. Today, the Coffee Club at Nagpur (a Tier 2 city in Maharashtra) has 131 members! Consumers, especially Gen Z, are experimenting, forming communities, and meeting up.” Mathur expects greater growth in the next 2-3 years, with more cafes opening, more coffee brands “doing interesting things,” and more options for home brewing.

However, the domestic market is not yet a replacement for exports. Most Indian coffee drinkers still consume instant coffee or filter coffee, which is blended with chicory and made with milk and sugar, reducing the quantity of coffee per cup. Exports will continue to be the mainstay as long as the volume of coffee consumed and its value remain higher than within India.

Growth of speciality coffee

The specialty coffee movement, which is seeing global growth, is also enjoying its moment in India. Indian coffee has been scoring well at the

cupping table. Dr. IM Mandappa, who heads Coffee Quality at the Coffee Board, places the SCA cupping average at 84-86, calling it a “decent score.” On specialty coffee, he says, “We are at a nascent stage but growing exponentially. There are 40 to 60 farmers who are going all out and focussing on specialty coffee as a segment. Premiums are good. Interest and awareness among the younger coffee audience is great.”

The board recommends coffee farmers interested in adding specialty coffee begin by converting 20% into specialty while relying on bulk coffee to generate sufficient funds to cover expenses. Growers are encouraged to identify a market for specialty coffee, without which this transition will not yield any benefit. Switching to specialty coffee production calls for basic infrastructure upgrades with a greater emphasis on post-harvest processing care and technology know-how.

Komal Sable and Akshay Dashrath started the South India Coffee Company in 2017, beginning with their family estate in Coorg. The couple, based in London, saw a gap and an opportunity for Indian coffee, or, as Sable says, “I couldn’t see any recognition for Indian coffee. A lot of work goes into coffee production, and due respect must be given to the coffee producers. And producers must know where their coffee is going.” SICC began with small batches of single-estate coffees, setting up a direct supply chain with roasters in the UK.

The challenge for them was that Indian coffee was not a big player in specialty. Although it stood out in a blind cupping, buyers had yet to acknowledge its quality. “We need to be known for our coffees,” says Sable. “Four years ago, it was tough. Now, buyers are seeing the work being done and the coffees coming out and are excited. I tell the roasters to come down to India and see what we are doing, where and how coffee is grown, and who grows it – we don’t need much more to sell.”

IB Bopanna, coffee planter and founder of Chombuka Coorg Coffee Company points out that Indian coffee today is a filler. “Speciality coffee is the cachet that can pull up the rest of Indian coffee. But we need to move beyond specialty coffee. We need high-quality coffee that we proudly call ‘Indian coffee,” he said.

Growth in Indian robusta

Indian coffee is also seeing a shift towards robusta. Globally, too, robusta now stands at 40% of coffee production. As a plant varietal, robusta is hardier and yields higher than arabica, incentivizing Arabica farmers to switch.

In the global market, Indian robusta continues to command good prices as it has always been a coffee of repute. What needs greater attention is to produce top-class robusta that can hold its own with the best in class arabica. That robusta can rise to specialty ranks is finally acknowledged; it’s no longer the lesser of the two coffees. In 2015, the Uganda Coffee Authority and the Coffee Quality Institute introduced the Fine Robusta Standards and Protocols, which showed how robusta can be processed for better outcomes. Robusta is finding its place in the specialty coffee spectrum in small steps.

Coffee expert Sunalini Menon points out that at the tasting sessions held during the World Coffee Conference, the quality of Indian robusta surprised the attendees. In Coorg, Chombuka has begun to market a high-grown fine robusta. “Roasters also need to sit up and take notice of robusta,” says IB Bopanna, pointing out that climate change is impacting arabica more than robusta. “Better quality robusta is the need of the hour, and India is well positioned to achieve it.”

Meanwhile, at Sable’s SICC, research is underway on another varietal, the Coffea Excelsa, which shows greater climate resilience and is proving to be a low intervention choice.

Growth in non-traditional areas

“I am very excited for the non-traditional areas,” says Dr. Mandappa. While the traditional coffee-growing regions can no longer expand and have hit saturation, the non-traditional areas offer new terroir. New coffee farmers can enjoy the learnings that Indian coffee has gained and have access to experts. In 2023, one of the winners for Flavours of India was an Arabica from Odisha, produced by a tribal Farmer Producer Organisation. From the Eastern Ghats of Andhra Pradesh, Araku Coffee has shown how Indian coffee can be marketed as a single-origin coffee. And from northeast India, Nagaland is increasingly becoming a terroir to reckon with for specialty coffee.

Coffee cultivation began in earnest about 15 years ago; today, about 1,000 hectares are shade-grown. Coffee is seen as a welcome opportunity in a heavily tribal-populated area dependent on government support in place of wider economic opportunities.

In neighboring Sikkim, Nikhil Pradhan, who runs the Bermiok estate, decided to add coffee cultivation to his tea farm in 2015 to diversify from tea. Says Pradhan, “It’s not a volume game. We have to go specialty, with high grown, fermented, and other innovation.” The prices of tea and coffee remain widely disparate – Bermiok’s first flush tea can fetch about $110 per kilo, while their highest value coffee (organically grown) brings a maximum of $25 per kilo. However, coffee is a welcome addition for tea planters whose tea harvests stop for winter, which marks the beginning of the coffee season. Currently, they grow 40% of Bermiok’s coffee while the rest is sourced from local coffee farmers.

Sikkim is uniquely positioned as the entire production is consumed within the state. With an emphasis on supporting local coupled with the growth of cafes and hospitality, Bermiok’s coffee has found its market right at home. While their tea is traded, they retail their entire coffee production near home, perhaps a case study of how a domestic market can support locally grown and made coffee.   

Indian coffee in 2024

Taking the energy and optimism from the WCC forward, Indian coffee needs to continue what has begun – emphasizing quality, transparency, education, and promotion.

“There’s a lot of potential for domestic and exports,” adds Dr. Mandappa. “If half the population of India has 1 cup of coffee every day, we will have a glut.”

“This can be the year of RTD (ready-to-drink) beyond instant coffee,” says Mathur, adding that many brands now offer cold brew cans and bottled cold coffee accessible via a new generation of supermarkets. He calls RTD “a step above instant coffee,” acknowledging that convenience still plays a role for consumers.

What is needed to tie it all in is a single branding exercise for Indian coffee. Bopanna talks about the growing interest displayed by Indian coffee drinkers at the WCC, which encouraged coffee growers. “We, as growers, have to push our brand,” he reiterates. “We got a boost in the internal market with the WCC, but across the world, coffee consumers don’t associate coffee with India. We need to market ourselves to consumers and build our brand.” A significant aspect of Indian coffee is that it’s cultivated in an inherently eco-friendly way. Carbon sinks, sustainability, and green economy may be new catchphrases.

But for India’s coffee farms, they’ve been a way of life either by design or due to the economies of scale. India’s coffee plantations have always had an agro-forestry approach, and this goes beyond shade-grown to multi-cropping and inclusion of native species to support a thriving biodiversity. It’s a story waiting to be told.

Adds Bopanna, “India is a powerhouse of technology and creative talent. If we can lift the profile of Indian coffee, the benefit will go to the small growers, making coffee cultivation economically sustainable.” Ultimately, how Indian coffee leverages its current strengths will influence its future place in global coffee.