Mumbai, Oct 31 - Indian tea and coffee exports to Russia are likely to be impacted in 2008 as the global financial crunch may force producers there to cut imports by about 20 percent, industry officials said.
"We are worried...it could be a major problem for instant coffee exporters," said Ramesh Rajah, president, Coffee Exporters Association of India.
Russian tea and coffee producers may cut imports by about 20 percent in the next few months due to the world financial crisis, the head of industry lobby Rusteacoffee said on Wednesday. See [ID:nLT282952]
Russia imports practically all its tea and 100 percent of its coffee from abroad. The country accounts for 10 percent of India's total coffee exports. India mainly exports robusta coffee to Russia.
Robusta is typically blended with arabica beans for a lower-cost option for brewed coffee, or processed into instant coffee.
However, it is very early to figure out the extent of losses, Rajah said.
India has exported about 17,000 tonnes of coffee to Russia till Oct. 24, according to the Coffee Board of India.
Tea exports to Russia are also likely to be affected as the country imports 30 percent of its requirement from India, said Kamal Baheti, director of McLeod Russel India Limited, the largest Indian tea exporter.
India's total tea exports in Jan-Aug 2008 rose 16 percent to 124.04 million kg. Tea export figures to Russia were not available.
The main tea suppliers to Russia are Sri Lanka, India, China, Indonesia, Kenya and Vietnam.
"If the crisis continues, everybody is going to cut back expenditure and obviously tea and coffee (exports) are going to be suffer," Rajah said.