A Glance Into The Coffee Trade

Coffee is easily one of the world's most popular beverages. With around 25 million small coffee producers relying on coffee for a living, coffee has become an important commodity. One third of the world's coffee is produced in Brazil where, alone, over 5 million people find employment in the cultivation and harvest of more than three billion coffee plants.

Speaking statistically about coffee trade, Latin America provides for 60 % of the total global output. Asia provides 24 % and Africa 16 %. It is produced in most tropical countries. Brazil, Vietnam and Columbia produced more than half of the world's output of coffee between 2001 and 2006 and other significant producers were Indonesia, Ethiopia, India and Mexico.

In countries like Brazil, coffee is produced on large farms with modern equipment, with facilities of irrigation, tractors and coffee harvesters. In other places like Central America, Africa and Asia, it is produced by smallholders. It is usually the high income countries that consume coffee. Around 80 % of this internationally traded product is consumed by high income countries.

In some years, this drink has proved to be the second most traded commodity after crude-oil, churning out almost 15 billion dollars of export revenue. U.S.A accounts for nearly 18 % of global consumption, after which comes Brazil (13 %), Germany (9 %), Japan (6 %) and France and Italy accounting for 5 % each.

There have been various national and international policy interventions subjected to the coffee market as have been coffee agreements administered by the International Coffee Organization. Currently Vietnam has emerged a low-cost producer of coffee and is generating a fantastic amount of coffee every year since the time it started and is really catching up with the market. Mechanization of coffee harvesting has helped lower production cost, and good use of irrigation has stabilized and sustained yields.

By: Leah Abranza

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