Coffee is a popular drink and is an important commodity. Tens of millions of small producers in developing countries make their lives grow coffee. More than 2.25 billion cups of coffee are consumed in the world every day. More than 90% of coffee production occurs in developing countries - mostly South America, while consumption occurs mainly in industrialized countries.
25 million small producers rely on coffee to live around the world, in Brazil alone, where nearly a third of all world coffee is produced, Brazil has the largest coffee export in September 2017 http://www.ico.org/prices/m1-exports.pdf, over 5 million people work in cultivating and harvesting over 3 billion coffee plants; it is a more labor-intensive culture than the alternative culture of the same area as sugar cane or beef, as it is not subject to automation and requires constant attention.
Coffee is a major export commodity: it is the top agricultural export for twelve countries in 2004, the seventh largest legal agricultural export in the world by value in 2005, and "the second most valuable commodity exported by developing countries," from the year 1970 to about 2000 This last fact is often wrongly stated; look at the commodity coffee market.
Furthermore, green coffee (not roasted) is one of the most traded agricultural commodities in the world, and is traded in futures contracts on many exchanges, including the New York Mercantile Exchange, the New York Intercontinental Exchange, and London. Financial Exchange and International Trade Options. The biggest transfer point in the world for coffee is the port of Hamburg, Germany.
Video Economics of coffee
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In 2009 Brazil was the world leader in green coffee production, followed by Vietnam, Indonesia, Colombia, and Ethiopia. Arabica beans are grown in Latin America, eastern Africa, Arabia, or Asia. Robusta coffee beans are grown in western and central Africa, throughout Southeast Asia, and to some extent in Brazil.
Peanuts from different countries or regions can usually be distinguished by differences in flavor, aroma, body, and acidity. This flavor characteristic depends not only on the region of coffee growth, but also on the genetic subspecies (varieties) and processing. Varieties are generally known by the region in which they grow, such as Colombia, Java and Kona.
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Consumption
In 2000 in the US, coffee consumption was 22.1 gallons (100,468 liters) per capita. More than 150 million Americans (18 and older) drink coffee every day, with 65 percent of coffee drinkers consuming their hot drinks in the morning. In 2008, this was the number one hot drink among supermarket customers, generating about 78 percent of sales in the distributed hot beverage category.
Pricing
According to the Composite Index of the group of coffee-exporting countries based in London, the International Coffee Organization, the average monthly coffee price in international trade has been well above 100 US cents/lb during the 1970s and 1980s, but then declined over the end 1990s reached a minimum in September 2001 of only 41.17 US cents per lb and remained low until 2004. The reasons for this decline included the collapse of the 1962-1989 International Coffee Agreement under Cold War pressure, which had held the minimum price of coffee at US $ 1, 20 per pound.
The expansion of the Brazilian coffee plantation and the entry of Vietnam into the market in 1994 when the US trade embargo against it was lifted by adding supply pressure to the farmers. The market rewards cheaper Vietnamese coffee suppliers with trade and causes inefficient coffee bean growers in many countries like Brazil, Nicaragua, and Ethiopia can not live off their products, which at some times are priced below production costs, forcing many people quit the production of coffee beans and moved to slums in the cities. (Mai, 2006).
The decline in green coffee costs, while not the only cost component of the last trophies presented, occurs at the same time as the increasing popularity of specialty cafes, which sells their drinks at an unprecedented high price. According to the American Specialty Coffee Association, in 2004 16% of adults in the United States drinking specialty coffee every day; the number of specialty retail coffee locations, including cafà © s, kiosks, coffee carts and retail roasters, totaled 17,400 and total sales was $ 8.96 billion in 2003.
Specialty coffee, however, is often not bought on commodity exchanges - for example, Starbucks buys almost all of its coffee through multi-year private contracts that often pay double the price of commodities. It is also important to note that coffee sold in retail is an economic product different from wholesale coffee traded as a commodity, which is input to major end products so that the market is ultimately affected by changes in consumption patterns and prices.
However, in 2005, coffee prices rose (with the above-mentioned ICO Composite Index monthly average of between 78.79 (September) and 101.44 (March) US Cent per lb). This increase may be due to increased consumption in Russia and China as well as harvest which is about 10% to 20% lower than that in the previous year's record. Many coffee bean growers can now live on their products, but not all the extra extras trickle down to them, as rising oil prices make transportation, roasting and packing coffee beans more expensive.
Prices have risen from 2005 to 2009 and sharply in the second half of 2010 amid fears of a poor harvest in major coffee-producing countries, with ICO indicator prices reaching 231 in March 2011.
Classification
A number of classifications are used to label coffee produced under certain environmental or labor standards. For example, "Friendly Bird" or "shade coffee" is said to be produced in areas where natural shade (canopy trees) are used to shelter coffee plants during part of the growing season.
Fair trade coffee is produced by small coffee producers who are members of cooperatives; guarantee a minimum price for these cooperatives, albeit at historically low prices, the current fair value of trade is lower than the market price only a few years ago. Fairtrade America is the premier organization that currently oversees Fair Trade coffee practices in the United States, while the Fairtrade Foundation does so in the UK.
The commodity chain for the coffee industry
The coffee industry currently has a commodity chain that involves manufacturers, intermediate exporters, importers, roasters, and retailers before reaching out to consumers. Intermediate exporters, often referred to as "coyote" coffee, buy coffee directly from small farmers. Coffee plantations and large plantations often export their own crops or have direct arrangements with transnational coffee processing or distribution companies. Under fine arrangement, large manufacturers can sell at prices set by New York Coffee Exchange.
Green coffee is then purchased by importers from exporters or large planters. Importers retain a large container load inventory, which they sell gradually through many small orders. They have the capital resources to get quality coffee from all over the world, the normal roasting of capital does not have. The great dependence on craftsmen on importers has a major effect on importers of the types of coffee sold to consumers.
In the United States, there are about 1,200 roasters. Roasters have the highest profit margins in the commodity chain. Large roasters typically sell pre-packaged coffee to major retailers, such as Maxwell House, Folgers, and Millstone.
Coffee reaches consumers through cafes and specialty stores that sell coffee, which is roughly 30% is a chain, and through traditional supermarkets and retail chains. Traditional supermarkets and retail chains have around 60% market share and are the main channel for specialty coffee and non-specialty coffee. Twelve billion pounds of coffee is consumed worldwide every year, and the United States alone has over 130 million coffee drinkers.
Coffee is also bought and sold by investors and price speculators as tradable commodities. The Arabica coffee futures contract is traded on the New York Board of Trade (NYBOT) with the ticker symbol KC with contract shipments occurring annually in March, May, July, September, and December. Robusta futures coffee is traded on ICE London (Liffe) under ticker symbol RC with contract shipments occurring annually in January, March, May, July, September and November.
Fair trade coffee
According to the World Fair Trade Organization and the three main organizations of Fair Trade (International Fairtrade Labeling Organization, Network of European Worldshops and the European Fair Trade Association), the definition of fair trade is "trade partnerships, based on dialogue, transparency and respect. greater in international trade ". The stated objective is to offer better trade conditions to producers and workers who are marginalized. Fair trade organizations, together with consumer support, campaigns for changes in conventional international trade rules and practices. However, not all coffee producers are happy with the method or the result.
Fair Trade Organizations promote a trading environment where coffee importers have a direct relationship with coffee producers, not including intermediaries. Coffee importers give credit to certified farmers to help them stay out of debt with coffee traders so they can develop long-term trade relationships. Producer organizations are paid the lowest price (Fairtrade Minimum Price) of US $ 125 cents per pound for certified FairCred certified Arabica and US $ 120 cents for unwashed Arabica, or market price, if higher. Coffee free trade prices rose above this minimum in September 2007, but due to recent economic events, the price of free trade fell back below this minimum in October 2008. The fair trade price for conventional robusta coffee has been $ 1.01 since June 2008 The price of conventional commodity coffee was also more than $ 1 in 2008, but about $ 0.70 in 2009.
Fairtrade certification is not free; there are registration fees, initial certification fees, membership fees, annual audit fees, and more. Certification can cost thousands of Euros for one plantation. Large farming firms can often handle documents and recover certification costs more easily than independent small farms. As a result, there are many small and independent farms that are not Fairtrade certified even though they meet or exceed Fairtrade standards.
Coffee and the environment
Initially, coffee farming was done under the shade of trees, which provide a natural habitat for many animals and insects, approximate the biodiversity of natural forests. These traditional farmers use compost from coffee pulp and get rid of chemicals and fertilizers. They also usually plant bananas and fruit trees as shelter for coffee trees, which provide additional income and food security.
However, in the 1970s and 1980s, during the Green Revolution, the US Agency for International Development and other groups gave eighty million dollars to plantations in Latin America to progress along with a general shift to processed agriculture. These plantations replace their shade planting techniques with sun cultivation techniques to improve crop yields, which in turn destroy forests and biodiversity.
Sun planting involves logging trees, and high chemical fertilizer and pesticide inputs. Environmental problems, such as deforestation, pesticide pollution, habitat destruction, soil and water degradation, are the effects of most modern coffee farms, and the biodiversity of coffee plantations and the surrounding areas are suffering. Of the 50 countries with the highest deforestation rates from 1990 to 1995, 37 were coffee producers
Consequently, there has been a return to traditional and new methods of growing shade-tolerant varieties. Banana-grown coffee can often gain premium as a more environmentally sustainable alternative to commonly grown coffee.
See also
- Black Gold (movie 2006)
References
External links
- Green certified coffee: How much is it? - Green coffee market share in 2013 with links to references and industry sources.
- Coffee company: How many are certified environment? - North American coffee brands and the number of certified copies are purchased each year, most of 2008-2013.
- The latest trade data copy on the ITC Trade Map
- An article on the world coffee trade on the Agritrade website.
Source of the article : Wikipedia
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