A lot of people prefer starting the morning with a cup of coffee – it gives the feeling of vivacity and certainty that the day will be a good one. What are we going to face in the nearest future? What is coffee market like?
Southern part of Ethiopia is the homeland of coffee. The culture has gradually spread around the world, and at this point best sorts of coffee are supplied from the countries of Latin and Central America (in this reference it is worth mentioning that America is the homeland of cocoa, and Africa is its main supplier – such kind of gift exchange between the continents).
There are 3 main types of coffee tree on the Earth. Arabica is the first one. It occupies the leading position concerning a number of characteristics. For example, the quantity of grades, the share of sales in world trade, and world production of coffee beans.
Robusta is the second type.
Liberica is the third and the last type of coffee. Liberica is characterized by low yield, high fastidiousness, and lack of demand.
Arabica – the most important type of coffee worldwide – is characterized by complex flavour. The culture is very fastidious. Optimum conditions for Arabica are provided by mountainous tropics at the height of 900-2100 m above sea level. Moisture – regular abundant rainfall. Average temperature of the habitat amounts to 15-24°C. Total absence of frost is the main condition. The soil is to be well fertilized. The term from the moment of blossom to ripening amounts to 6-7 months. Number of yields per year – 1-2. Interchange of drought and rainfall is the major criterion of the number of yields.
Robusta – the second most popular type of coffee worldwide – is characterized by high content of caffeine in beans. Robusta is used in coffee mixes in order to make the drink stronger.
Robusta is unpretentious; it can well stand high temperature and moisture. Low-lying tropics at the height up to 900 m make up optimal conditions for the culture’s existence. Moisture – regular heavy downpours. Average temperature of the habitat amounts to 22-27°C. It is characterized by wet soil and high temperature. Robusta is resistant to illnesses and insects. The period from blossoming to ripening amounts to about 5-6 weeks. Number of yields per year – 12-15. Following the technique of maintenance is the major criterion for the number of yields.
Arabica is of highest demand in Europe and America. The table below shows that Brazil is the major supplier of Arabica (about 50%). The data in the table is provided in thousands of 60-kg bags, and the agricultural year includes the period from October one year to September of the following.
Robusta is mostly used at the West. However, it is also widely used in Europe for production of mixes and instant coffee. Vietnam (21000 ths. bags) and Indonesia (8300 ths. bags) are the main suppliers of Robusta. It is also worth mentioning that Robusta also grows in Brazil, and Vietnam also produces Arabica.
The general prediction about coffee production worldwide during the seasons of 2011/12 and 2012/13, according to USDA, is provided in the table below.
The table shows that next year coffee yield is predicted to rise by 7.5%. The peculiarity of growing coffee is the fact that it brings high yield 2 times per year (large and small cycles). From this point of view current season is a small cycle, but for a small cycle the yield will break the record. USDA data about previous years is provided in the table below.
It is worth paying attention to two moments in the table. The first one concerns the big difference between the seasons of 2009/10 and 2008/09. In 2010 this has been accompanied by rapid price rise for many types of foodstuffs. As a result, the price for coffee has risen from 132 cents per pound to 309 cents from June 2010 to May 2011 (see the chart).
The second one concerns the drop of coffee yield in Columbia during the recent years. Such drop was repeated this year in July-August in Brazil. This has resulted from pouring rains during the recent years, due to which a considerable number of trees was conk. Therefore, when this year rains started in Brazil during the period of harvesting, there was great concern about the loss of yield and fungus.
Such concern has been added by fluctuations at stock and currency markets and dollar speculators. Because of this, in mid-June price for coffee ha started from 150 cents per pound and tried to break the point of 191 cents per pound. During the last decade of August it became clear that rains have has minor impact on the quantity of yield, but quality has slightly decreased, which has resulted into the price drop. It has currently started from 160.25, and then two times from 162.5 cents per pound.
