The Hindu Business Line : Brazil to help boost domestic coffee offtake

COOLING TEMPERS?: Mr Jairam Ramesh, Union Minister of State for Commerce, addressing coffee industry representatives in Bangalore on Tuesday along with Mr G.V. Krishna Rau, Chairman, Coffee Board. - G.R.N. Somashekar

Bangalore , March 28

The Coffee Board will brew a fresh generic campaign, with Brazilian expertise, to boost domestic consumption even while sharpening its export strategy to regain the lost share in key markets such as Russia.

The Union Minister of State for Commerce, Mr Jairam Ramesh, who met the industry representatives in Bangalore on Tuesday to discuss the future of the coffee industry, said the new promotional campaign would be ready over the next three to six months.

India, which grows close to 2.75 lakh tonnes of coffee, exports about 80 per cent of its produce while 20 per cent is consumed domestically. The domestic consumption that was stagnant at 60,000 tonnes per annum till 2000 has increased to 80,000 tonnes in the last five years.

"This is a good sign and we need to accelerate it further for the sector to be in a healthy state," Mr Ramesh said adding that his Ministry has set a target to the Coffee Board to double the domestic consumption in the next 10 years.

Brazilian consultant

Further, Mr Ramesh said, Brazilian marketing consultant Mr Carlos Brando would be in India in April to study and advise the Coffee Board on charting an aggressive marketing strategy. Mr Carlos Brando of P&A Marketing has played a key role in promoting Brazilian coffees. Brazil, which faced problems similar to that of India in boosting consumption, has trebled its consumption in about a decade.

Export strategy

Mr Ramesh also said that the Board, in collaboration with the industry, would be sharpening its export strategy and regain market share especially in Russia, which had been a captive market for Indian instant coffees till recently. Nearly two-thirds of the Russian market had been lost and efforts would be made to regain it, he added.

"The strategy would also focus on tapping the incremental growth opportunities in countries such as Italy and Yugoslavia where Indian coffees compete with Vietnamese coffee," he said. Besides good productivity, Vienamese coffee costs at least 50 per cent less than the Indian coffee and this was posing a major problem, he said.

Coffee festival

In a bid to create increased awareness about Indian coffee in the global markets the Coffee Board expects to organise a biannual event — India International Coffee Festival. The first such event would be held in Bangalore in February 2007 and will be on the lines of BangaloreIT.in and BangaloreBio.com, he said. Mr Ramesh said an Inter-ministerial Working Group was looking into the issues relating to the amendment of Plantation Labour Act. This was for government sharing of the social infrastructure costs along with the plantation community. It was proposed that the Central and State Governments would share about 50 per cent of the social infrastructure costs of the planters. "We will be in a position to go to the Union Cabinet with this proposal soon," he said.

A Group of Ministers has also been set up to revamp the Price Stabilisation Fund, which has been a non-starter till now, he said. "We are asking the former IRDA Chairman Mr Rangachary to work out suitable insurance mechanism to protect the small coffee, tea and rubber growers," he said.