Kodagu: Coffee planter Kushalappa Ramesh, one of India's top rally drivers, has been forced to put the brakes on his passion for motor sports after a plunge in coffee prices left him stranded in debt.

Ramesh's plight is common among planters in the southern Indian district of Kodagu, which accounts for 40 per cent of the country's coffee production of 320,000 tonnes.

Hundreds of labourers in coffee plantations have been laid-off and businesses, which thrived around the main coffee trade, in the once booming and picturesque hill town of Kodagu are facing their toughest time ever.

From a peak of Rs 3,000 ($ 65) for a 50 kg bag of Robusta coffee in 1994, prices have hit a low of Rs 650, while Arabic parchment has slumped to Rs 2,100 from Rs 3,400.

At the peak of the coffee boom, resulting from the Brazilian frost of 1994, big planters like Ramesh lived the life of high-rollers, indulging expensive hobbies with little concern for the future.

"Now I don't even have enough money to pay for my fertiliser. My business is stuck," said Ramesh, a bachelor, who owns 70 acres (28 hectares).

In the financial year to March 2001, according to official estimates, India's coffee output is forecast to be about 320,000 tonnes making it the world's seventh largest producer.

Planters blame the price plunge on a steep increase in global productivity, the breakdown of an international coffee agreement in 1989 and the entry of new producers.

"The decline in prices has had a direct effect on our quality of life," Bose Mandanna, a planter in Kodagu said. "I have cut my workforce by 30 per cent and unemployment in this district is getting serious.

"One million people are directly or indirectly employed in coffee plantations. Now they are facing an uncertain future," Mandanna said. "If this is bad for rich planters, one can imagine the plight of small producers who own five acres of land and constitute more than 40 per cent of the total planters."

AFP