Outlook for the World Coffee Market Annual General Assembly Koninklijk Verbond van Koffiebranders Union Royale des Torréfacteurs de Café 23 May 2011 José Sette Executive Director a.i. International Coffee Organization - www.ico.org
ICO composite indicator price Monthly averages: January 1990 to April 2011 in current terms 240
220
200
180
160
US cents/lb
140
120
100
80
60
40
20
0
International Coffee Organization - www.ico.org
1
ICO group indicator prices Monthly: January 1990 to April 2011 in current terms 325 300 275 250 225
US cents/lb
200 175 150 125 100 75 50 25 0
Colombian Milds
Other Milds
Brazilian Naturals
Robustas
International Coffee Organization - www.ico.org
ICO composite and group indicator prices historical comparison US cents per pound Last monthly average Highest monthly when price was when price was average ever average ever higher recorded April 2011
ICO Composite
231.24
243.06 June 1977 314.96
Colombian Milds
312.95
318.50 May 1997 320.78
Oth Mild Other Milds
300 12 300.12
317 68 April 1977 317.68 A il 1977 317.68 317 68
Brazilian Naturals
273.40
280.24 May 1986 369.00
Robustas
117.37
118.13
March 2011
312.24
April 1977 April 1977 April p 1977 April 1977 April 1977
International Coffee Organization - www.ico.org
2
ICO composite indicator price (deflated) Monthly averages: January 1990 to April 2011 in constant Apr-Jun 2000 terms 250
200
US cents/lb
150
100
50
0
UN index
USA CPI
International Coffee Organization - www.ico.org
Exports by group and by type of coffee October to March (000 bags) 2009/10 TOTAL
2010/11 % change
45 847
52 921
15.4
by group of coffee Colombian Milds
4 238
5 604
32.2
Other Milds
9 944
12 091
21.6
Brazilian Naturals
15 649
17 993
15.0
Robustas
16 015
17 233
76 7.6
by type of coffee Arabicas
29 831
35 688
19.6
Robustas
16 015
17 233
7.6
International Coffee Organization - www.ico.org
3
Exports by the top 10 exporting countries October to March (000 bags) TOTAL Brazil Vietnam Colombia India Indonesia H d Honduras Peru Ethiopia Guatemala Uganda
Opening stocks in exporting countries Crop years 1964 to 2010 100 90
85.8 81.0 80.2
80 70
71.0
70.7 68.1
64.5
64.063.5
million bags
60 53.8 53.8
55.1
55.8 54.2 53.1 52.2
54.9 52.4 52.0 48.2 45.3 42.6
49.5
50
44.8
55.154.0
53.5
44.2 42.2 41.0 40.0
40.3
40
52.7
48.3
47.4
41.2 37.2
34.6 32.6 32.7 29.6 30.5
30
28.3 27.7 20.5 19.5
20
13.0
10 0
*Preliminary
International Coffee Organization - www.ico.org
Inventories in importing countries Calendar years 1964 to 2010 25
22.3 20.3
20
20.1 0. 20.1 20 1
19.3
18.6 18.1
16.0
16.1
21.4 21.1 20.2 19.1 18.3
16.1
14.8
million bags
15 12.6 11.6
10.5
10.5
10
8.4 7.9
8.2
7.8
7.8
7.5 6.3
5.6
9.3
9.3
8.5 68 6.8
66 6.6 6.1
9.3
9.2
9.0
8.8
9.8
5.7
7.9
7.5
8.4 8.2 7.7
6.1 6.4
5
0
*Preliminary
International Coffee Organization - www.ico.org
6
Total exports to all destinations Calendar years 2000 to 2010 100
97.5
98
96.2
96 1 96.1
96.7
96
million bags
94 92 90
89.6
91.6
91.1
90.9 88.8
87.6
88
86.4 86 84 82 80 2000
2001
2002
2003
2004
2005
2006
2007
2008
2009
2010*
*Preliminary
International Coffee Organization - www.ico.org
Value of coffee exports Calendar years 2000 to 2010 18 16.5 15.4
16 14
12.8
billion US dollars
12
13.3
10.8
10
9.3 8.2
8 6
6.9 5.4
5.2
5.6
4 2 0
*Estimated
International Coffee Organization - www.ico.org
7
World Coffee Conference Guatemala, 26-28 February 2010
International Coffee Organization - www.ico.org
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; g ; increases in yields; y ; improvement p 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. International Coffee Organization - www.ico.org
8
Challenges: The way forward 2 3. Capacity-building and strengthening of institutions and d support services i 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.
International Coffee Organization - www.ico.org
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, prgrammes geographical indications, indications trademarks and other initiatives) Industrialization
International Coffee Organization - www.ico.org
9
Challenges: The way forward 4 8. Information and market transparency 9 Environmental sustainability 9. 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 International Coffee Organization - www.ico.org
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?
International Coffee Organization - www.ico.org
10
World consumption Calendar years 2000 to 2009 140 129.3
130 120 110
109.8
111 4 111.4
2001
2002
119.9
120.7
2004
2005
132.2
131.2
134.0
2008
2009
2010*
124.4
114.0
105.5
100
million bags
90 80 70 60 50 40 30 20 10 0 2000
2003
2006
2007
*Estimated
International Coffee Organization - www.ico.org
Estimated consumption: 10 leading markets by volume World total USA Brazil Germany Japan France Italy Russian Federation Canada Spain United Kingdom
Belgium: consumption of all forms of coffee Calendar years 1990 to 2010 1 800 1 579
1 600
1 537
1 484 1 396
1 400
000 bags
1 200
1 309
1 073
1 103
1 039
958
1 000
886 800
1 158
1 133
1 124
789 708
834
934
884
696
871
650
600
400
200
0
International Coffee Organization - www.ico.org
Belgium: imports, re-exports and net imports Calendar years 2005 to 2010 Imports
Re-exports Net imports (000 b bags))
2005 2006 2007 2008 2009 2010
4 063 4 605 4 014 6 792 5 916 5 924
2 905 3 067 2 911 6 142 4 981 5 053
1 158 1 537 1 103 650 934 871
International Coffee Organization - www.ico.org
14
Belgium: retail prices of roasted coffee Current and constant 2005 terms 18
16
14
€ per kg
12
10
8
6
4
2
0
current terms
2005 terms
International Coffee Organization - www.ico.org
Per capita consumption (in kg) in selected countries in 2010 Finland Denmark e a Norway Switzerland Sweden Germany Canada Brazil Italy France Belgium USA Japan Russian Federation