Rising farm-gate prices and upcoming EUDR regulations weigh on coffee exports

By Admin

04 Sep, 2025

Indian coffee exporters are facing turbulent times as rising farm-gate prices and the looming European Union Deforestation Regulations (EUDR) threaten to disrupt one of the country’s most profitable agricultural exports. While India has long held a strong position in the global coffee market, current challenges could lead to reduced exports and loss of key European markets.

Export Pressure from High Farm-Gate Prices

Farm-gate prices of coffee are currently ruling at a record Rs 440 to Rs 460 per kg, forcing traders to delay their purchases from farmers. With Italian buyers India’s largest coffee market turning away due to high quoted prices, exporters are under significant stress.

According to the Coffee Exporters’ Association of India, nearly 50,000 metric tonnes of Indian coffee may remain unsold this season. Data from the Coffee Board of India shows that between January 1 and September 1, 2025, exports fell 11.32% to 2,68,452 metric tonnes, compared to 3,02,752 metric tonnes during the same period last year.

Despite the volume drop, exporters earned Rs 12,673 crore this year higher than last year’s Rs 9,854 crore due to elevated global prices.

Italian Buyers Turn to Cheaper Alternatives

Traditionally, Italy has been India’s largest coffee buyer. However, exporters say Italian buyers are increasingly sourcing from Uganda, where Robusta coffee is significantly cheaper.

• Indian Robusta export price: $5200–$5250 per tonne FoB
  
  

• Ugandan Robusta export price: ~$4800 per tonne FoB
  
  

This 8-9% price difference has tilted the market in Uganda’s favor. “Our Italian buyers are complaining that our coffee is expensive when compared to Ugandan coffee. It is unusual this year as we will carry forward about 50,000 tonnes of unsold coffee, far higher than the usual 10,000–25,000 tonnes,” said Ramesh Rajah, President of the Coffee Exporters’ Association of India.

What Are EUDR Regulations?

The European Union Deforestation Regulations (EUDR) aim to ensure that products entering the EU are not linked to deforestation or forest degradation. Key objectives include:

• Blocking deforestation-linked products from EU markets
  
  

• Promoting traceability and transparency in global supply chains
  
  

• Reducing the EU’s carbon footprint with climate-friendly sourcing
  
  

• Strengthening environmental and anti-corruption standards
  
  

Large coffee planters and exporters must comply with EUDR rules by December 30, 2025, while small growers and traders have until June 30, 2026. However, most Indian coffee growers are yet to adapt, raising concerns about long-term market access.

Exporters Seek New Markets

India exported 4,02,526 metric tonnes of coffee worth Rs 14,046 crore in 2024, with key markets being Italy, Germany, Russia, Belgium, UAE, and Turkey. But with EUDR deadlines approaching and European buyers turning to cheaper sources, Indian exporters are now exploring North Africa and West Asia as part of their de-risking strategy.

Outlook for the Industry

While high prices have temporarily boosted revenue, the combination of unsold stock, regulatory hurdles, and shifting buyer preferences poses significant risks for India’s coffee industry. Unless compliance with EUDR regulations is expedited and price competitiveness is restored, exporters could see a prolonged dip in their European market share.