Coffee becomes a key cash crop for Nepali farmers

SANGAM PRASAIN
KATHMANDU, NOV 15 -

Nepal’s coffee production has soared over the last decade as an increasing number of farmers switched from poor-paying silk and honey to coffee.

According to the Agriculture Ministry, coffee output increased from 72 tons in 2000 to 384 tons in 2010. Production in 2009-10

was up 15 percent compared to 2008-09.

Higher earnings from coffee have encouraged farmers to expand the land under cultivation five-fold from 314 hectares in 2000 to 1,650 hectares in 2010.

The Agriculture Perspective Plan did not give priority to coffee and the Asian Development Bank did not incorporate it as a high-value product during the implementation period as silk and honey were considered to have high export potential. However, farmers took to growing coffee prompted by rising demand and better incomes.

Farmers in Lalitpur were the first to grow coffee in Nepal, which now has expanded to over 25 districts across the country.

Farmers in Palpa, Syangja, Arghakhanchi, Lalitpur, Makwanpur, Gulmi, Kavre and Sindhupalchok including 17 other districts across the country are aggressively engaged in commercial coffee cultivation with demand for organic coffee soaring in the global market. Lalitpur and Gulmi are the major coffee producing districts in Nepal.

“The country could reap huge benefits if Nepali coffee could be properly marketed at the international level,” said Agriculture Ministry spokesperson Hari Dahal.

In order to promote commercial coffee farming and boost its export, the government had prepared a three-year strategic plan. However, the plan has been stuck at Department of Industry. As per the plan, the National Tea and Coffee Development Board (NTCDB) had applied for the get its coffee logo registered at the department.

After the issuance of the logo by the department, all the

private, state-owned or cooperative coffee producers will get a collective trademark confirming that the coffee is produced and certified in Nepal.

Although coffee output was up significantly, it fell short of the target by 50 percent. The government’s three-year interim plan had projected production to cross 685 tons by the end of the plan period (2009-10). Dahal said the target could not be reached due to low productivity. Nepal’s productivity stands at 300 kg per hectare, way below the world average of 2 tons per hectare.

Nepal exports about 65 percent of the total coffee produced. The country started exporting coffee commercially in 2000 with a shipment of 9 tons. In 2008-09, it exported 88 tons of coffee worth Rs. 790 million.

Japan, South Korea, the US, Canada, India, the UAE and Bhutan are Nepal’s major markets. Exporters said that there was high demand for organic coffee in the international market.

According to the International Coffee Organization, world coffee exports in 2009-10 amounted to 93.8 million bags (one bag contains 60-70 kg). The US and Brazil are the largest importer and exporter of coffee respectively in the world.