Araku Coffee Made Farmers Earn More. Now It Needs Indian Consumers to Pay More Too

Araku Coffee has spent years improving what happens at the farm. Its next challenge is happening at the café counter. As coffee quality across Araku Valley continues to rise, the specialty coffee brand is trying to persuade Indian consumers to pay prices that allow those gains to flow back to farmers.

Founder Manoj Kumar, who is also CEO of Naandi Foundation, says Araku sources coffee from close to 100,000 farmers in Andhra Pradesh. Around 4,000 estates are producing coffee scoring 85–86 on the specialty scale, while roughly 30,000 farms are at 80–82 and the remaining growers are steadily improving. Anything above 80 is generally considered specialty-grade coffee.

That quality has pushed Araku’s procurement prices higher. Kumar claims the company pays farmers about 60% more than competing buyers. Last year, it paid ₹850–₹1,200 per kg for coffee cherry, compared with roughly ₹550 in the export market for similar quality. The challenge is that better farmer economics also require Araku to capture more value further down the chain.

One response has been to move away from selling green coffee. When Araku opened its first Paris café in 2019, Kumar says the business was entirely a green-coffee exporter. Roasted coffee now accounts for as much as 80% of its output, with the eventual goal of moving completely to roasted products. But higher prices have also caused some international buyers to reduce volumes or use Araku coffee selectively in blends.

Araku is therefore pushing harder into ecommerce, premium B2B accounts and its own cafés. It currently operates three cafés in Paris, two in Bengaluru and two in Mumbai. The cafés are intended not only to sell drinks but also to explain the farming, quality and sustainability story behind them.

Now the bigger experiment is at home. Araku sold limited nanolots quickly to Indian consumers and plans to keep this year’s nanolots within India. The company is even exploring whether select café offerings can command substantially higher prices. The bet is simple: if Indian coffeequality can reach global premium levels, can Indian consumers learn to value it that way too?