T.Y.

BCOM
(BANKING &INSURANCE)
YEAR 2008-09

GROUP MEMBERS
 Coffee marketing

Introduction
International coffee
organization
India's pre-liberalization
marketing chain
India's after liberalization chain
Medium term export strategy
for coffee
Future strategies for new
market
 Financial assistance in exporting coffee

INTRODUCTION

EXPORT FINANCE IN INDIA

PRE-SHIPMENT FINANCE

POST-SHIPMENT FINANCE

COFFEE SCHEME:
 SUPPORT TO SMALL
GROWER SECTOR SCHEME
 INTEREST SUBSIDY
SCHEME FOR LARGE AND
SMALL GROWERS
 INTRODUCTION
Coffee is a major export
commodity
in developing countries.
Before
liberalization heavy
taxation also
made coffee an important
source of
revenue. The government to
take over
Marketing because of the
difficulties
faced by the marketers.
 ICO The ICO had profound
impact on the
(International Coffee World coffee
market.coffee producing
Organization) countries & coffee
importing members of
OECD were members
were
of ICO .

Government of all major

coffee producing
companies had wanted to
take some joint market-
controlling measures doing
so would have been
difficult and costly, given
that begun liberalizing
their coffee sub sector.
 Pre- liberalization marketing chain
Producers

Coffee Board

Domestic market Export

(30%) (70%)

Before liberalization, the producers of coffee were selling

their coffee production to Coffee Board at fixed price. On
the basis of curing works like cleaning, sorting and
grading, Coffee Board decide to market this goods in
market in proportion of 30 % to Domestic Market and
70 % for Exportation.
 Post-liberalization marketing chain

Producers

Auction

Exporters

Domestic market Export

After liberalization, producer started to sell their product

in domestic and international (export) market on auction
basis and role of coffee board was shifted from marketing
to research,extention & promotion.
Thus producers were satisfied after liberalization of
marketing chain because that made Export to customers
directly, avoiding implicit taxes (sales tax).
 MEDIUM TERM EXPORT STRATEGY FOR COFFEE

Cost reduction to improve competitiveness.

Improving quality perception of Indian
coffee.
Integrating Indian coffee with the global
coffee trade.
Guarantee reliability of exporters.
Carryout a major communication initiative in
key overseas markets to enhance the image of
Indian coffee as well as to improve market
share.
Participation in important overseas trade fairs
involving exporters and grower exporters.
Organizing buyer-seller meets between
Indian exporters and overseas buyers in key
markets.
 Future Strategies
Future for for
Strategies New Market:
New Market:
Establishment of Export Promotion Council for
Coffee.

Government Regulation in Quality Testing and

Processing.

Duty Free Import for Processing Equipments.

Extensive Marketing and Promotional Activities.

Sponsoring Trade Fairs and Global Coffee Summits.

Attractive and Durable packaging and

Transportation.

Regular Market Survey for Customer Satisfaction

Financial assistance in exporting coffee
introduction
EVERY BUSINESS REQUIRES FINANCE. EXPORT
FINANCE REFERS TO THE FINANCE OF THE
GOODSFROM HOME COUNTRY TO THE
IMPORTERS PORT. THE EXPORT FINANCING
BEGINS AS SOON AS AN EXPORT ORDER IS
RECEIVED AND ACCEPTED.. MOST OF THE
EXPORT TRADE IS CARRIED OUT ON CREDIT
BASIS. IT TAKS 3 TO 6 MONYHS TO RELISE THE
EXPOT BILLS. MEANWHILE, THE EXPOTER HAS TO
FURTHER ORDERS FOR WHICH ADDITIONAL
WORKING CAITAL IS REQUIRED.
 EXPORT FINANCE IN INDIA
THE NATURE OF EXPORT
FINANCE MAY BE SHORT
TERM OR LONG TERM
CREDIT. SHORT TREM
CREDIT FACILITY IS
EXTENDED FOR A PERIOD
FROM 30 DAYS TO 180 DAYS
WHICH IS GRANTED BY
COMMERCIAL BANKS. AND
LONG TERM FINANCE IS
PROVIDED FOR A PREIOD
FROM 5YEARS TO 2O
YEARSWHICH IS PROVIDE BY
EXIM,ECGC AND IDBI BANK.
Pre shipment and post shipment finance
 Coffee schemes

Support to Small Grower

Sector Scheme:
Financial incentives are given for
taking up the following Capital
Investments in the farms of the
Small Coffee Growers:
•Replanting.
•Water Augmentation.
•Quality Upgradation.
•Pollution abatement measures

To establish/set up appropriate
infrastructure in the farms, and
to achieve value additions.
 Interest Subsidy Scheme for Large and
Small Growers:

To provide financial relief to small coffee

grower sector on the interest charged by the
financial institutions on extending the
working capital/crop hypothecation loans,
Interest Subsidy Scheme has been introduced
on year on year basis subject to the approval
of government @5% for small growers and
3% for large growers.
 Conclusion
Coffee is a major export
commodity
in developing country like India
and liberalisation of coffee market
has given rise to competition and
to survive in this competitive
market newer and newer
strategies are need to be formed to
take the advantage of
opportunities arising in this
market. Simultaneously
Financing also plays an important
role in developing coffee market
THANK YOU