Enhances subsidy rates and extends assistance to corporates & co-operatives in 12th Plan period

The Coffee Board has set a target of achieving 400,000 tonnes of bean production through more of planting and productivity in the next five to 10 years, about 30 per cent growth over current output.

In 2013-14, production was 304,500 tonnes, a level it has roughly stayed at in recent years.

“Coffee production has stagnated. We have chalked out several programmes like area expansion in non-traditional areas and replanting in traditional areas, along with productivity enhancement,” Board chairman Jawaid Akhtar told planters here on Thursday.

A package has been readied for Andhra Pradesh and Odisha. Plantations in the former’s Araku valley were hit by the recent Hudhud cyclone; about 1,000 tonnes of damage is estimated. Tribals in the region had grown around 6,700 tonnes, spread over 58,000 hectares, Akhtar said. As part of the area expansion, he told the annual coffee conference organised by Karnataka Planters’ Association and United Planters’ Association of Southern India, the aim is to have the Araku valley produce around 25,000 tonnes in the next five years. The Board has proposed to provide Rs 10 per kg subsidy to tribals for marketing it, he said.

The Board has also proposed to continue its replantation and expansion subsidy for growers. The modalities to implement new schemes are likely to be approved next week, Akhtar said. It wishes to retain the replantation or expansion subsidy rates at 40 per cent for areas up to two hectares, 30 per cent for two to 10 ha and 25 per cent for holdings above 10 ha for the 12th Plan period. In addition, it has proposed to raise the unit cost calculation by 75 per cent to Rs 175,000 a ha. For the first time, it has proposed to have corporate groups and co-operatives be eligible for the subsidy.

Also for the first time, the Board has introduced a subsidy for eco-certification, at half the certification cost, with a ceiling of Rs 50,000 a beneficiary. It has also raised the subsidy for quality upgradation to Rs 2.5 lakh up to 20 ha.

The Board has also continued a subsidy scheme for pollution abatement measures and made corporate and cooperative growers’ bodies eligible. The rate of subsidy is to be doubled to 40 per cent, with a ceiling of Rs 5 lakh for a beneficiary.

It has also proposed to enhance the rainfall insurance premiums for small growers and reimburse them up to 75 per cent of the premium. For the first time, it has proposed a support of Rs 4 a kg of clean coffee to small grower collectives, self-help groups and other cooperatives.

The incentive for export of value-added coffee in retail packs as India brands has been enhanced by 50 per cent to Rs 3 a kg. Plus a doubling of the incentive for export of high value coffee to high value markets, to Rs 2 a kg.

Also for the first time, a 25 per cent subsidy on the cost of machinery for curing units, to a ceiling of Rs 50 lakh each.

source: http://www.business-standard.com / Business Standard / Home> Markets> Commodities> Other Commodities / by Mahesh Kulkarni / Bengaluru – November 13th, 2014