In the past 60 years the export of coffee has changed dramatically.
In postwar Brazil coffee was about 90% of all exports, today coffee only makes up 10% of all exports. (Reference 1) Yet, coffee will always be a very important and influential export for Brazil and many of the neighboring countries. Brazil and neighboring countries make up part of what is known as the coffee belt. (Image Link) (Image Link) In the past 60 years the percentage of coffee as an export for most countries has decreased the amount of coffee exported worldwide has steadily grown and has reached record amounts.Three countries have had interesting export history since 1990. Brazil has maintained the number one spot while increase total exports of coffee by enormous amounts. Columbia has maintained its standing as one of the world’s leading exporters of coffee but has steadily declined in the past 20 years. Vietnam was almost a very small exporter of coffee over 20 years ago and is now the number two exporter in the world.
(Picture, Reference 3) | 1990| 1999| 2009| 2011| Brazil| 16,935,788| 23,149,204| 30,346,000| 54,500,000| (60kg bags of coffee) (Reference 4)Brazil was the number one exporter of coffee in 1990. In 1990 Brazil exporter 3,000,000 more bags of coffee than Columbia the number two exporter at the time. Brazil has maintained at least a 30% growth every ten years since 1990. From 1990 to 1999 Brazil’s coffee export grew 37%, from 1999-2009 31%. From 2009 to 2011 Brazil increased its coffee export 80%! In the span of 21 years Brazil was able to increase the export of coffee by 37,564,212 bags of coffee, a 222% increase. (Reference 5) | 1990| 1999| 2009| 2011| Colombia| 13,943,870| 9,995,310| 7,894,000| 9,500,000| (Reference 6)Colombia has had a very different story over the past 20+ years. In 1990 Colombia was the number two worldwide exporter of coffee, 7,000,000 bags more than the closest country, Indonesia. In the twenty years following 1990 Colombia would have constant decreases in the amount of coffee exported.
From 1990 to 1999 Colombia saw a -28% decrease, followed by -21% ten years later in 2009. There was an increase from 2009 to 2011 of 20%. Overall from 1990 to 2011 Colombia saw a -32% decrease in total coffee export. Yet has stayed in the top three worldwide exporters of coffee. Reference 7) | 1990| 1999| 2009| 2011| Vietnam| 1,145,234| 7,727,613| 17,052,000| 18,752,000| (Reference 8) In 1990 Vietnam was only a small supplier of coffee, 20+ years later it has become the number two worldwide leader. Vietnam has seen amazing increases in production and import over the years.
From 1990 to 1999 Vietnam increased exports of coffee by 575%. From 1999 to 2009 another 121% increase in export of coffee. (Reference 8) These three countries show the interesting aspects of coffee exports that have occurred in the past 20+ years.Here is the list of the top worldwide exports of coffee as of 2011: (Reference 9) TOTAL:| 1) Brazil 54,500| 2) Vietnam 18,725| 3) Colombia 9,500| 4) Indonesia 9,325| 5) India 5,100| 6) Ethiopia 4,400| 7) Honduras 4,000| 8) Peru 4,000| 9) Guatemala 3,910| 10) Mexico 3,700| Where does all of this coffee go? (Reference 10) The top five importers of coffee worldwide are The USA, Germany, Japan, Italy and France. Image Link) Demand from The USA has remained constant since the year 2000. Since 2000 The USA has imported over 20,000,000 million bags of coffee every year.
Since 2000 Germany has increased their import every year, going from under 14,000,000 bags to just over 20,000,000 bags in 2011. Japan has stayed near 7,000,000 bags of imported coffee the past ten years. France has maintained 7,000,000 bags of coffee as well.
Italy became the third largest imported of coffee by increasing its demand from 6,000,000 bags to 8,000,000 bags a year over the past ten years. Reference 11) 2013 has already shown to be a peculiar year for coffee import and exports. There has been a 60% decrease in Arabica coffee futures from the 2011 price. The 2011 price was a 14 year high for the coffee. This drop in price has resulted the cost of production to surpass the current market price.
Brazil and Colombia have some of the lowest costs in production, 126 cents and 160 cents respectively, yet both countries cost of production have surpassed the market price. As of June 23rd the July contract price for a pound of coffee was 116. cents. This has caused a lot of problems for coffee growers.
As a result of this the Brazilian government has stepped in to make an effort to help support the coffee industry of Brazil. In June Brazil granted the coffee industry a 1. 46 billion us dollar credit line. This credit line will cover the cost of storing the coffee, help buy coffee from growers as well as other expenses of the coffee industry. The government is hoping to avoid diving coffee prices even lower as a result of coffee growers continuing to sell their excess harvest. (Reference 12)The large drop in coffee prices has been great for companies. Shipments of coffee in the first half are up 20% from last year numbers.
This increase in savings has translated to the largest coffee stockpiles since 2007. Starbucks stated April 25th that their latest quarter, ending April 31st, saw an increase in operating profit go from 13. 5% to 15. 3% which was due in large part to the decrease in coffee prices.
Companies are also lowering prices of coffee; Starbucks decreased certain prices of coffee by 10%, Dunkin Donuts by 6% and Kraft by 6% as well. (Reference 13)