Development Support for Coffee in Traditional Areas: Support to Small Growers' Collectives/SHGs/Cooperatives for Coffee Marketing

What is the coffee marketing support scheme?

This scheme is Sub-Component 3 of Component 9 (Market Development) under the Coffee Board's development support for coffee in traditional areas. The Coffee Board is a statutory body under the Ministry of Commerce and Industry, and it administers the scheme in the traditional coffee-growing states: chiefly Karnataka, Kerala and Tamil Nadu.

According to the Coffee Board's scheme modalities, the objective is to "extend support to small and tiny growers, incentivizing them to form collectives, Self Help Groups and cooperatives" and to take up marketing of their coffee on a community basis. India's coffee is grown overwhelmingly by small holders, and individually they have weak bargaining power. By marketing together, growers can improve both the quality of their coffee and the value they realise, through better prices and collective bargaining.

How much is the subsidy?

The scheme pays a marketing subsidy of Rs 4.00 per kg of clean coffee sold by the collective, SHG or cooperative. "Clean coffee" means coffee in green-bean form, the subsidy is not paid on coffee sold in cherry or parchment form. There is no separate cash entitlement beyond this per-kilogram incentive; the value each grower receives depends on how much clean coffee they contributed to the collective sale.

The subsidy is released only after the sale is completed, and it is credited directly to the bank accounts of the individual member growers through NEFT, based on the sale note issued by the auctioneer or commodity exchange. So while the collective applies, the money reaches the individual members in proportion to their sales.

Who is eligible for the coffee marketing support scheme?

You can apply if:

• You are a small growers' collective, Self Help Group (SHG) or cooperative of coffee growers in a traditional coffee-growing state.
• The coffee marketing is done in the name of the collective/SHG/cooperative, not in individual members' names.
• The coffee is sold through one of the recognised channels:
• a recognised public auction platform such as the Indian Coffee Trade Association (ICTA);
• direct export by the organisation; or
• a recognised commodity exchange where physical delivery of coffee takes place.
• The coffee is sold in clean green-bean form.

You cannot apply if:

• You are an individual grower marketing coffee on your own. This scheme is not eligible for solo sales. You must be part of a registered collective, SHG or cooperative. (The subsidy does, however, reach individual members' bank accounts once the collective sells.)
• Your coffee was sold in cherry or parchment form rather than clean green-bean form.
• You sold outside the recognised channels — private off-market sales that are not through ICTA-type auctions, direct export or a recognised commodity exchange do not qualify.
• You cannot furnish the required documents. The guidelines state that failure to furnish the requisite documents entails rejection of the claim.

How to apply for the coffee marketing subsidy

1. Form and register the collective. Small and tiny growers organise as a growers' collective, SHG or cooperative and obtain a certificate of incorporation or registration from the concerned authority.
2. Market the coffee in the collective's name through a recognised auction platform (such as ICTA), by direct export, or through a recognised commodity exchange with physical delivery; in clean green-bean form.
3. Fill the prescribed application (in duplicate) for the marketing subsidy, attaching the certificate of registration, the full member list (Annexure 1 with planted area, coffee type, survey numbers and each member's bank details), the attested sale note or export documents, and a membership certificate for each claiming grower.
4. Submit the application to the Deputy Director (Extension) of your respective Coffee Board region.
5. Scrutiny and approval: the Deputy Director (Extension) scrutinises the application and forwards it to the Coffee Board Head Office for approval. On approval, the subsidy is released by NEFT to the individual members' bank accounts.

Help and contact

• Coffee Board Deputy Director (Extension) of your region, the office that receives and scrutinises applications.
• Coffee Board of India: coffeeboard.gov.in

The Coffee Board reserves the right to amend or withdraw the scheme, and warns that claims obtained by furnishing wrong information will be recovered with interest. Applying through the Coffee Board is free; no middleman is required.