European Coffee Federation Coffee Market Overview March 2010 (issue nr 2)
Introduction In this publication by ECF, initiated by the ECF Logistics Committee, we aim to provide a quick overview of key parameters of the coffee market to our external relations. The information is drawn mainly from public sources like Eurostat and the International Coffee Organization, but presented in an accessible and compact format. Comments and suggestions are welcome. Please contact us at: European Coffee Federation P.O. Box 161 2280 AD Rijswijk The Netherlands Telephone +31 70 336 51 65 E-mail ecf@ecf-coffee.org
Production According to provisional data of the International Coffee Organization (ICO), total production in crop year 2009/10 is estimated to be 123.7 million bags compared to 128.2 million bags in 2008/09, a drop of 3.6%. During crop year 2009/10 Colombia will not be able to recover its normal production after the decrease in 2008/09, given the combination of climatic problems and the occurrence of coffee pests. In Brazil, where the harvest of the 2009/10 crop is complete, a fall in production of more than 14% compared to 2008/09 has been reported. According to Conab, the Brazilian production in crop year 2010/11, which is the high-yielding year for Arabicas in the biennial production cycle, will be between 45.9 and 48.7 million bags. Exporters arrive at a higher estimate of 53-59 million bags. The graph shows the green coffee production in the 20 largest producing countries, ranked in accordance with the 2009/2010 crop
Green coffee production crop years 2007/08 - 2009/10 (in 1000 bags) 50.000 45.000 40.000 35.000 30.000 25.000 20.000
2007/08 2008/09
15.000 10.000 5.000 0
2009/10
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Coffee Market Overview
Exports
Coffee exports 10 main countries calendar years 2007 - 2009 (bags) 35.000.000
30.000.000
25.000.000
20.000.000 2007 15.000.000
2008 2009
10.000.000
5.000.000
0
Production does not automatically reflect exports. Some of the producing countries have a significant local market. The table on the left based on ICO data - provides information on the exports to all destinations by the ten major exporting countries.
Prices In this overview, world market prices for green coffee are provided in the form of the ICO Indicator 250 Prices for Colombian Milds (representing 200 coffees produced in Colombia, Kenya and 150 Tanzania), Other Milds (representing 100 coffees produced 50 the other washed arabica growing 0 countries), Brazilian naturals (representing Brazil and Ethiopia) and Robustas (representing a large group of countries, including Cameroon, Cote d’Ivoire, Indonesia, Uganda and Vietnam).
ICO Indicator Prices monthly averages (US cents/pound)
Composite Indicator Price Colombian Milds Other Milds Brazilian naturals Robustas
From March until August 2009, prices for Columbian Milds were much higher than usual. This was caused by a Columbian crop which was considerably lower than normal, following a combination of adverse weather conditions and the implementation of the programme to replace old coffee trees with young ones. In the longer term this rejuvenation programme will mean a healthy production base, but in the short
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Coffee Market Overview
term it means a drop in production as the young trees have a lower yield in the first few years. Concerns over slow recovery of the Colombian crop and lack of readily available replacement coffee from other origins resulted in renewed price increases for Colombian coffee from November 2009.
EU Imports In the first eleven months of 2009 the 27 EU members imported a total of 45.8 million bags (2.75 million tonnes) of green nondecaffeinated coffee from all origins. This is a reduction of 1.6% compared to the 46.6 million bags (2.79 million tonnes) imported in the same period of 2008. Imports from Brazil increased by 7% while those from Colombia dropped by 44%. Obviously this drop was linked to the reduced availability from this origin reported on previously. Imports from Vietnam decreased by 2% while those from Indonesia and Honduras increased by 9% and 5% respectively. Source: Eurostat
EU27 green non-decaffeinated coffee imports, January-November 2009 in bags and percent
GUATEMALA 752.038 2%
OTHER 10.367.030 23%
BRAZIL 13.391.018 29%
INDIA 1.206.075 3% ETHIOPIA 1.220.408 3% PERU 1.895.135 4% UGANDA 2.015.363 4%
VIETNAM 7.848.763 17% COLOMBIA 2.057.895 4%
HONDURAS 2.296.948 5%
INDONESIA 2.778.265 6%
Stocks
In close cooperation with the port– and warehouse organisations in the major European coffee ports (Antwerp, Bremen, Hamburg, Genova/ Savona Vado, Le Havre and Trieste), ECF collects aggregate data on total green coffee stocks, both terminal market and non-terminal market stocks. The table below shows the development of total stock volumes in all surveyed ports on a monthly basis for the past twelve months. October 2009 is provisional. The graph illustrates the development per port. Data are in bags.
ALL PORTS Dec 08
11.878.628
Jan
13.210.062
Feb
13.407.002
Mar
14.129.074
Apr
14.707.770
May
15.276.660
Jun
15.716.604
Jul
16.260.059
Aug
16.178.709
Sep
15.716.046
Oct
15.107.896
Nov Dec 09
14.125.600 13.517.603
Coffee Market Overview
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Consumption The ICO estimates the total volume of consumption in calendar year 2009 to be around 132 million bags, a steady increase compared to the 130 million in 2008 and 128 million bags in 2007. Consumption is defined as net imports plus or minus stock changes. The growth in world consumption is largely attributable to increased domestic consumption in exporting countries and the growing demand in emerging markets. Detailed data are only available for 2008 and before. Coffee consumption in selected EU members 2006-2008 (in 1000 bags) Consumption in the Euro10.000 pean Union seems to have stagnated over the last few 9.000 years, accounting for only 8.000 31.3% of world consumption 7.000 in 2008 compared to 27.6% for domestic consumption in 6.000 exporting countries. In re5.000 cent years the EU consump2006 tion fluctuated around the 2007 4.000 2008 40 million bags mark. The 3.000 next two graph shows consumption in the main EU 2.000 and non-EU markets in the 1.000 three most recent years. 0
Coffee consumption in selected countries 2006-2008 (in 1000 bags) 25.000
20.000
15.000
2006 2007 10.000
5.000
0
2008
It is not always appreciated that Brazil is now the second largest consuming country after the USA. The expectation is that in a few years time the Brazilian consumption will be at the same level as that of the USA. Other producing countries are significant consumers as well. Consumption in Indonesia is now at the same level as Canada. Please bear in mind that per capita consumption is a different story: Canada has 34 million inhabitants, Indonesia 240 million.