Outlook for the World Coffee Market 8 th AFRICAN FINE COFFEE CONFERENCE & EXHIBITION 17 to 19 February 2011 Arusha, Tanzania José Sette Executive Director a.i.
225 ICO composite indicator price Monthly: January 2000 to January 2011 200 175 150 US cents/lb 125 100 75 50 25 0
ICO group indicator prices Monthly: January 2010 to January 2011 300 250 200 /lb US cents/ 150 100 50 0 Colombian Milds Other Milds Brazilian Naturals Robustas
World Production Crop years 2000/01 to 2010/11 160 140 120 113.0 107.7 123.2 106.3 116.2 111.2 128.9 120.0 128.4 123.1 134.8 100 million bags 80 60 40 20 0 2000/01 2001/02 2002/03 2003/04 2004/05 2005/06 2006/07 2007/08 2008/09 2009/10 2010/11*
Total production in 2010/11 Colombia 9.0 Vietnam 18.4 Africa 18.1 Asia & Oceania 17.6 Brazil 48.1 South America 5.5 Mexico & Central America 18.0
Share of Robusta in world production Crop year 1980/81 to 2010/11 45% 40% 35% 30% 25% 20% 15% 10% 5% 0%
Production: 10 leading producers 2009/10 (Volume in 000 bags - % of world production) 2009/10 2010/11 % change Brazil 39 470 48 095 21.9% Vietnam 18 200 18 433 1.3% Indonesia 11 380 9 500-16.5% Colombia 8 098 9 000 11.1% Ethiopia 6 931 7 450 7.5% India 4 823 5 000 3.7% Mexico 4 200 4 500 7.2% Guatemala 3 835 4 000 4.3% Honduras 3 575 3 850 7.7% Uganda 2 797 3 200 14.4%
Production of Washed Arabicas Crop years 2000/01 to 2010/11 30 28.3 26.1 26.1 26.1 25.6 25.7 28.2 28.0 27.2 27.1 28.4 25 20 million ba ags 15 10 10.4 12.0 11.7 11.2 11.6 12.6 12.5 12.5 8.7 8.1 9.0 5 0 2000/01 2001/02 2002/03 2003/04 2004/05 2005/06 2006/07 2007/08 2008/09 2009/10 2010/11* *Forecast Washed Arabicas Colombia
Production of Natural Arabicas and Robustas Crop years 2000/01 to 2010/11 60 50 40 43.6 42.8 40.7 41.2 42.6 39.8 38.0 42.0 39.5 47.3 45.9 41.8 49.5 49.8 37.0 45.0 50.8 million ba ags 30 29.1 27.5 25.3 29.8 32.4 20 10 0 2000/01 2001/02 2002/03 2003/04 2004/05 2005/06 2006/07 2007/08 2008/09 2009/10 2010/11* *Forecast Natural Arabicas Robustas
Opening stocks in exporting countries Crop years 1964 to 2010 100 90 85.8 80 81.0 80.2 70 70.7 68.1 71.0 64.5 64.063.5 million bags 60 50 40 30 53.8 53.8 55.1 54.9 52.4 52.0 40.3 49.5 44.8 32.6 32.7 34.6 29.6 30.5 48.2 45.3 42.6 55.8 54.2 53.1 52.2 47.4 53.5 44.2 42.2 40.0 41.0 55.1 54.0 48.3 52.7 41.2 37.2 28.3 27.7 20 19.5 20.5 12.9 10 0 *Forecast
Inventories in importing countries Calendar years 1964 to 2010 25 21.1 21.4 22.3 20 18.1 19.3 18.6 20.1 20.1 20.3 20.2 19.1 18.7 16.0 16.1 16.1 15 14.8 million bags 10 8.8 10.5 9.0 9.2 8.4 7.9 8.2 7.8 7.5 6.8 9.3 8.5 7.8 7.5 12.6 11.6 9.8 9.3 7.9 10.5 9.3 8.4 8.2 7.7 6.1 6.6 5.6 6.3 5.7 6.1 6.4 5 0 *Forecast
120 Total exports to all destinations Calendar years 2000 to 2010 100 89.6 90.9 88.8 86.4 91.1 87.6 91.6 96.2 97.5 96.2 97.4 80 million ba gs 60 40 20 0 *Estimate 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010* calendar year
Exports to all destinations cumulative 12 months Washed Arabicas 27 24 21 18 million bags 15 12 9 6 3 0 12 months commencing Colombia All other Washed Arabicas
Exports to all destinations cumulative 12 months Brazilian Naturals and Robustas 38 36 34 32 million bags 30 28 26 24 22 12 months commencing Brazilian Naturals Robustas
Value of coffee exports Calendar years 2000 to 2010 18 16.5 16 15.4 14 12.8 13.3 12 10.8 llars billion US dol 10 8 8.2 6.9 9.3 6 5.4 5.2 5.6 4 2 0 *Forecast
World consumption Calendar years 2000 to 2009 140 120 105.2 109.4 111.0 113.5 119.3 119.9 124.4 129.3 131.7 130.2 131.0 100 million bags 80 60 40 20 0 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009* 2010* *Forecast
Europe 36% World consumption in 2009 (share by continent) Africa 6% Asia&Oceania 16% Central America + Mexico 6% South America 17% North America 19%
Estimated consumption in 2009: 10 leading markets by volume (million bags) USA 21.4 Brazil 18.8 Germany 8.9 Japan 7.1 Italy 5.8 France 5.7 Spain 3.4 Indonesia 3.3 United Kingdom 3.2 Russian Federation 3.1
World coffee consumption Comparison 2008 2009 (in thousand 60-kg bags) 2008 2009* Change (%) Traditional markets 70 357 68 924-2.0 Producing countries 37 814 38 967 3.0 Emerging markets 23 539 22 300-5.3 WORLD TOTAL 131 710 130 191-1.2 *Forecast
World coffee consumption Evolution 2000 2009 (in thousand 60-kg bags) 2000 2009* Annual growth (%) Traditional markets 64 879 68 924 0.7 Producing countries 26 385 38 967 4.4 Emerging markets 14 238 22 300 5.1 *Forecast WORLD TOTAL 105 503 130 191 2.4
World Coffee Consumption: Traditional markets Evolution 2000 2009 (in thousand 60-kg bags) *Provisional 2000 2009* Annual growth (%) Total 63 377 68 873 0.8 European Union 38 024 38 626 0.2 Germany 8 770 8 897 0.1 Italy 5 149 5 806 1.2 France 5 402 5 676 0.5 Spain 2 991 3 352 1.2 United Kingdom 2 342 3 220 3.2 USA 18 746 21 436 1.4 Japan 6 626 7 130 0.7
*Provisional World coffee consumption: Producing countries Evolution 2000 2009 (in thousand 60-kg bags) 2000 2009* Annual growth (%) Total 26 385 38 967 4.4 Brazil 13 075 18 208 3.4 Indonesia 1 664 3 333 7.2 Ethiopia 1 938 3 089 5.3 Mexico 1 189 2 200 6.4 India 938 1 573 5.3 Others 7 581 10 564 3.8
Domestic consumption in exporting countries Crop years 1990/91 to 2009/10 22 20 19.2 19.5 19.6 18 17.0 17.8 million bags 16 14 12 10 8 6 4 15.9 15.1 14.3 14.5 13.5 12.2 12.4 12.6 12.7 12.7 11.6 11.8 11.8 11.7 11.2 15.5 14.9 12.2 12.7 13.2 13.6 13.8 14.2 11.0 11.5 10.1 8.2 8.5 8.9 9.1 9.3 16.3 17.1 17.7 18.4 2 0 0.2 0.2 0.3 0.3 0.3 0.3 0.3 0.3 0.3 0.4 0.4 0.5 0.5 0.6 0.7 0.8 0.9 1.0 1.1 1.6 Brazil Vietnam All other producing countries
World coffee consumption: Emerging markets Evolution 2000 2009 (in thousand 60-kg bags) *Provisional 2000 2009* Annual growth (%) Total 15 744 22 500 3.6 Russian Federation 1 863 3 131 5.3 Algeria 1 779 2 066 1.5 Korea, Rep. of 1 246 1 551 2.2 Ukraine 179 1 460 23.4 Australia 832 1 223 3.9 Turkey 291 521 6.0 Croatia 327 366 1.1 Tunisia 174 289 5.2
Challenges: The way forward 1 1. Economic and policy environment: infrastructure; interest rates; exchange rates; and labour costs. 2. Basic and applied research: mapping of the coffee genome; conservation of genetic diversity and biodiversity; methods to manage pests and diseases; development of new varieties that are resistant to pests and diseases as well as better adapted to climate change; increases in yields; improvement in coffee quality; alternative uses of coffee byproducts; reduction in the use of water in cultivation and postharvest processing; measurement of carbon and water footprint; and food safety.
Challenges: The way forward 2 3. Capacity-building and strengthening of institutions and support services 4. Good agricultural practices: better fertility; erosion control; harvesting techniques; mechanization; integrated pest management; post-harvest processing 5. Diversification and multi-functionality: reduce excessive dependence on single product; seek complementary sources of income, such as other crops, livestock and ecotourism.
Challenges: The way forward 3 6. Finance and risk management: favourable credit conditions; financing for stocks, renewal of plantations, infrastructure and inputs; microfinance; protection (hedges) against price volatility; and weather risk insurance. 7. Value addition: Diferentiation (for example, by quality, certification or verification prgrammes, geographical indications, trademarks and other initiatives) Industrialization
Challenges: The way forward 4 8. Information and market transparency 9. Environmental sustainability Climate change: adaptation and mitigation strategies Carbon and water footprint Competing uses for land 10. Social sustainability Empowering women Aging farmers: Introduce programmes targeted to attracting young growers to coffee cultivation and stimulating youth entrepreneurship and involvement in sustainability programmes
Challenges: The way forward 5 11. Economic sustainability Price levels prevailing on the coffee market in recent years have been insufficient to off-set rising costs and encourage the necessary investment in the expansion of production to meet steadily growing demand. What will be effect of rising prices in recent months?
Share of Africa production in World Crop years 1970/71 to 2010/11 40% 35% 30% 25% 20% 15% 10% 5% 0% crop year
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