India’s coffee production is expected to hold near 6 million 60-kilogram bags in the 2025/26 market year (October-September), even as excessive monsoon rains hurt yields, according to the latest semi-annual coffee report from the USDA Foreign Agricultural Service (FAS) in New Delhi.
The crop is predicted to reach roughly 1.35 million bags of arabica and 4.7 million bags of robusta, with total output edging slightly below last season.
FAS projects total exports will fall about 3% to just under 6 million bags, as record-high green-bean prices push European buyers into shorter contracts and more cautious purchasing.
[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.]
Production Steady Despite Monsoon Rains
FAS expects arabica yields to fall 3% and robusta yields 2% after monsoon rains brought about 10% more rainfall across southern India, and much higher in some districts of Karnataka, the main coffee state.
Excess moisture has improved soil conditions but also fueled fungal diseases, berry drop and fruit splitting, according to sources in the report.
The USDA’s roughly 6-million-bag figure is more conservative than the Coffee Board of India’s latest post-blossom estimate of about 403,000 metric tons (around 6.7 million bags). Yet both estimates account for approximately 4% of the world’s coffee, with India trailing Brazil, Vietnam, Colombia, Indonesia, Ethiopia and Uganda in total production.
Exports Squeezed by Brazil Competition
Total exports in 2025/26 are forecast at 5.99 million bags, down from 6.21 million in 2024/25. Green coffee accounts for about two-thirds of shipments and instant coffee for the rest, with Italy, Germany, Russia, Belgium and the United Arab Emirates as leading buyers.
Year-to-date shipments (October-August) are already down 11% by volume as European roasters move from 12-month contracts to shorter three- or four-month deals and buy only for immediate needs.
FAS attributed the change in European coffee-buying behavior to higher prices. The report did not mention the European deforestation regulation, EUDR, which has now been delayed to December 2026.
The coffee trade landscape did shift significantly in November when the United States dropped an additional 40% duty on Brazilian coffee and removed a 10% reciprocal tariff on imports from most countries, returning Brazil’s effective U.S. coffee tariff to zero.
FAS says that move is likely to push more Brazilian arabica toward the U.S. and intensify competition in Europe, where India sells most of its coffee.
Domestic Demand
Domestic coffee consumption is forecast at 1.36 million bags in 2025/26, up from 1.15 million the year before, with soluble coffee expected to capture about 70% of the market. Per-capita consumption remains just 0.07 kilograms, far below the global average of roughly 1.3 kilograms.
New tax and labeling policies are designed to nudge that domestic market along. Effective Sept. 22, 2025, the Goods and Services Tax on instant coffee, extracts and essences dropped from 18% to 5%, matching the rate on filter coffee. FAS estimates the cut could lower retail prices by 11-12% and support demand.
Local Prices and Stocks
Farm-gate prices in Karnataka have climbed sharply, according to the report, with arabica parchment up about 58% year over year, and robusta cherry up around 10%, outpacing the International Coffee Organization’s composite indicator for arabica.
FAS attributes the divergence to a global supply crunch in Brazil and Vietnam combined with India’s relatively small but high-quality output.
Ending stocks are projected at 165,000 bags in 2025/26, the highest in three years but still tight by historical standards.
Together with new sustainability standards being drafted by the Coffee Board of India, the report suggests India will remain a niche but important supplier of arabica and robusta into global blends, even as it tries to turn more of its own population into everyday coffee drinkers.
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