India is the earliest country in Asia to cultivate coffee and ranks sixth in global production. Recently, coffee prices have been rising continuously, driven by heatwaves and droughts in Vietnam that have impacted Robusta coffee bean yields, creating a supply crisis and indirectly pushing up Arabica prices. This situation is beneficial for India, leading to increased coffee exports and greater global popularity for Indian coffee.

Recently, data from the Indian government showed that in the first quarter of 2024, India exported a total of 125,600 tons of coffee, a 13.35% increase compared to 110,800 tons in the same period last year. This growth was mainly driven by rising global coffee demand, especially for Robusta, as major producing countries like Vietnam and Indonesia faced reduced yields due to weather changes.

Although the rise in coffee prices has been beneficial to India’s coffee exports, it has also led to supply issues. According to local traders, some Indian coffee growers are currently unwilling to deliver beans at the previously agreed contract prices, resulting in export challenges for the country. They also noted that if such situations persist, it will significantly undermine traders’ trust in Indian coffee, leading to a decline in new export orders for Indian coffee.

Additionally, according to statistics released by the Coffee Board of India, the top five export destinations for Indian coffee are Italy, Germany, Belgium, Russia, and Jordan. However, India’s imports and exports are highly dependent on the Red Sea route, and the ongoing Red Sea crisis has caused significant losses to the country’s trade.

According to data released by India, goods passing through the Red Sea account for 50% of the country’s exports and 30% of its imports. As a result, the Red Sea crisis is expected to cause $30 billion in export losses for India. To avoid the Red Sea by rerouting around the Cape of Good Hope, India’s international trade transportation costs will increase by 161%. Therefore, India will deploy military forces second only to the United States to escort shipping in the Red Sea.