New EU rule may stir up trouble for Araku coffee exports

Time of India

16 hours ago

Araku Valley (Andhra Pradesh): A delay in geomapping farms of tribal growers cultivating Andhra Pradesh's celebrated Araku coffee could disrupt exports to Europe. That's because of a new law — European Union Deforestation Regulation (EUDR) — that comes into force by the end of the year, which mandates traceability to the last mile.
Only micro and small importers of Europe have an extended deadline — until June 30, 2026 — to comply. As coffee is a non-perishable item, European buyers, who at times procure beans in bulk for the entire year, have already begun insisting on EUDR-compliant shipments, ET has learnt. 'The clock is ticking,' warns an Indian exporter who sources beans from the hilly region — encompassing Paderu, Chintapalli, Minimuluru et al — collectively known as Araku Valley coffee, famed for its naturally grown, premium Arabica variety.
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'Many Araku growers don't even own a smartphone to initiate geotagging, and awareness of the stringent European regulation is alarmingly low,' he says, requesting anonymity, also adding that the penalties for EU importers are severe — not just limited to confiscation of noncompliant shipments, but extending to fines of up to 4% of the company's total annual turnover within the EU from the previous financial year.
Europe is India's largest coffee market, with Italy, Germany and Belgium emerging as the top three importers in FY25.
According to the Coffee Board of India, nearly 150,000 farmers cultivate the Geographical Indication (GI)-tagged Araku coffee, with each typically holding just one to two acres of land. 'Mapping coffee plantations through the India Coffee app is part of a nationwide exercise across all coffee-growing regions,' says HR Muralidhara, deputy director of the Coffee Board, based in Paderu, the biggest town in the coffee-growing region of Andhra Pradesh. 'Geolocation of farmers is essential for compliance with the EUDR norms, and we have only recently initiated the process among tribal growers in Araku.'
However, he declined to comment on allegations that the board is facing a shortage of field staff in the remote hilly region to raise awareness and complete the geotagging exercise before the deadline.
Unlike in Araku — where a single GPS coordinate per plot suffices for
EUDR compliance
due to the small landholdings, all invariably under four acres — larger estates in Karnataka's Kodagu (Coorg) and Chikkamagaluru require detailed polygon mapping.
'We have already completed polygon mapping for our member estates in Coorg and have shipped two consignments of coffee that meet EUDR standards,' says Vishwanath KK, CEO, Kodagu-based Biota Coorg Farmer Producer Company. He emphasises the urgency of scaling up geotagging efforts nationwide: 'Geolocation data must be collected in mission mode across India to ensure our coffee remains eligible for export under EU regulations from day one.'
Although the EUDR imposes penalties solely on European importers, Vishwanath notes, 'No importer will risk buying from an Indian exporter if the shipment — whether coffee or the six other regulated commodities like cocoa, rubber — fails to comply with the rules.'
For now, European buyers are accepting consignments if convinced the stock will be exhausted before the regulation comes into effect, he adds. 'But the pressure to demonstrate compliance — that the product is not linked to deforestation— will only grow stronger in the coming months.'
In Chumpi, a village nestled in the Araku Valley, coffee farmer Khogesh Rao says local buyers often come directly to their homes to purchase freshly harvested coffee fruits, which are then processed and passed on to larger buyers based in cities. 'Some of us have small pulping machines. If the coffee is washed, it fetches a better price,' he explains, also adding that no one in his village has undertaken any geolocation exercise.
'We're working to reduce the role of middlemen by encouraging Araku farmers to engage directly with companies and even invest in small-scale curing units of their own,' says Kalpana Kumari, managing director of Girijan Cooperative Corporation, a state-run body that procures coffee and minor forest produce from tribal farmers.
'Tata Coffee, Continental Coffee, Third Wave — so many multinational enterprises are sourcing and exporting Araku coffee now,' she adds.