India’s green coffee production is forecast to fall 4.5% to 6.14 million 60-kilogram bags in market year 2026/27, with arabica yields hurt by excessive early-year rain followed by a prolonged dry spell during flowering and fruit development, according to the latest USDA Foreign Agricultural Service annual report.
The report forecasts exports rising 3% to 6.22 million 60-kilogram bags, supported by a larger exportable surplus, strong demand for soluble coffee and new trade agreements with the UK and European Free Trade Association countries.
[Note: This is part of an ongoing series of DCN stories that explore USDA FAS country-level coffee reports, which are produced by different authors and field offices around the world.]
Weather Affecting Arabica
The 2026/27 production forecast includes 1.56 million bags of arabica and 4.58 million bags of robusta. That would put total production below the 2025/26 estimate of 6.43 million bags, despite robusta remaining comparatively strong. The report attributes the arabica drop to unusually high temperatures and dry conditions in key regions following excessive early-year rainfall.
Arabica yields are projected to decline 8% year over year to 452 kilograms per hectare, while robusta yields are forecast to fall 2% to 1,239 kilograms per hectare. FAS cited numerous factors negatively affecting arabica yields, including aging trees, white stem borers and reduced agricultural inputs.
Rising fertilizer and input costs remain concerns for India’s nearly 250,000 coffee growers, about 98% of whom are considered smallholders with farms under 10 hectares. Labor also remains a major cost, accounting for nearly 70% of production costs, according to the report.
Exports Rise With Soluble Demand
Exports are forecast to rise to 6.22 million bags in 2026/27, including 3.68 million bags of green coffee and 2.53 million bags of soluble coffee.
Italy remains the top buyer for Indian coffee, followed by Germany, Russia, Belgium and the United Arab Emirates. Among 10 key export destinations shown in the report, the United States appeared among the smallest markets for Indian coffee in 2025, behind countries including Libya, Jordan and Poland.
The new report said India may benefit from strong soluble demand, a weaker rupee and supply disruptions among competing origins. Yet Indian coffee continues to trade at a premium to coffee from Vietnam and Indonesia, while higher freight costs and Middle East congestion may pressure some shipments.
Trade Deals Support Packaged and Soluble Coffee Exports
Recent trade agreements may further support Indian exports of soluble and other roasted coffee products. The India-UK Comprehensive Economic and Trade Agreement offers duty-free access for roast-and-ground and instant coffee, while the European Free Trade Association agreement provides zero-duty access for coffee exports to Switzerland, Norway and Iceland.
Domestic consumption is forecast to hold near 1.58 million bags, with soluble coffee representing about 73% of domestic use. FAS said domestic growth is being supported by younger consumers, home consumption, social media and specialty cafes in cities such as Bengaluru, Mumbai and Jaipur.
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