Impact of US-Iran Conflict on India's Coffee Exports
India's coffee exports hit as US-Iran war disrupts global supply chains | Here's how
Hindustan Times
Image: Hindustan Times
India's coffee exports face significant challenges due to the ongoing US-Iran conflict, with potential losses of up to 80% in the West Asian market. Rising freight costs and disrupted shipping routes are straining the industry, which has seen record growth in recent years.
- 01Indian coffee exports could lose up to 80% of the West Asian market due to rising shipping costs and disruptions.
- 02Freight costs have doubled since the onset of the US-Israeli conflict with Iran.
- 03India is the world's seventh-largest coffee producer, exporting approximately 70% of its output.
- 04The coffee sector's export earnings surged from $1.14 billion in 2023 to $2.13 billion in 2024.
- 05Specialty coffee varieties have helped India establish a foothold in higher-value markets.
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The ongoing conflict between the US and Iran is severely impacting India's coffee export industry, particularly in West Asia. Ramesh Rajah, president of the Coffee Exporters Association of India, warned that exporters could face an 80% loss of the West Asian market due to rising freight costs and shipping disruptions. Freight costs have reportedly doubled since the US-Israeli conflict began in February, leading to delays and rerouting of shipments. India, the world's seventh-largest coffee producer, exports about 70% of its coffee output, with West Asia accounting for 16.1% of its exports in 2024. The coffee sector had recently experienced a boom, with export earnings nearly doubling from $1.14 billion in 2023 to a record $2.13 billion in 2024. However, the current geopolitical tensions threaten to undermine this growth, as buyers in Europe are already considering alternatives like Ugandan coffee.
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The disruption in coffee exports could lead to increased prices for consumers and reduced availability of Indian coffee in West Asian markets.
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