Coffee production over the period 1852 - 2011 in millions of bags
Source: UNCTAD secretariat based on the statistics of the publication "150 years of coffee", Marcellino Martins & E. Johnston (1992) for the period 1852-1965 and the International Coffee Organization (ICO) for the period 1965-2011.
Over 95% of world coffee production is performed by fifty states. This has increased considerably over a century and a half. With less than 5 million bags of coffee produced in 1852, production has increased to over 130 million bags in 2011.
In fact, for several years, the production was over 100 million bags. In the last two years, it has been 133 million in 2010 and 131 million in 2011. At the same time, more than 90 million bags are exported each year: 91 million in 2010 and 97 million in 2011.
This production continues to rise and has increased by 20% between 2005 and 2011, two times faster than market demand.
The largest producer of coffee is Brazil by far, particularly the state of São Paulo, where the first coffee port in the world is located: the port of Santos, followed by Vietnam (the largest producer of robusta) and Colombia.
For several years, the respective share of these three countries represented more than half of the coffee world production. In 2011, it was approximately 70.5 million bags of coffee.
Coffee growing is usually not a tradition. In the case of Vietnam, it comes entirely from a political will, encouraged by the World Bank, which led the country to become the largest producer of robusta, in the year 1987 was at number 31.
By contrast, some first rank African countries, such as Ivory Coast, have greatly reduced their production.
Distribution of world coffee production among major producers (average 2007/8 - 2011/12)
Source: UNCTAD secretariat based on the statistics of the ICO
During the period 1995-2012, the share of the Asian region in the world coffee production has increased.
In fact, this has increased from15% in 1995 to 25% in 2011. Production volumes have increased almost three times (12.8 million bags produced in 1995 to 33.6 million in 2002).
This increase is mainly explained by the strong increase in production in Vietnam which has gone from a level of 4 million bags in 1995 to over 19 million bags in 2011.
This important productive effort, especially since 1995, has turned the country into a major market player in terms of production, moving Colombia away from its second place in terms of share during the period 2007/8-2011/12 (15% world production is from Vietnam, compared with 7% for Colombia).
Distribution of world coffee production among major producers over the period 1995-2012 (in %)
Source: UNCTAD secretariat based on the statistics of the ICO
The factors affecting supply:
•
The uncertainty regarding the volume of production:
Coffee is a crop that follows a biennial cycle, it is for this reason that the production does not follow the price in the short term and yields may or may not coincide with movements in the market. The offer also depends on weather conditions, harvesting can be damaged by frost as was the case in Brazil in 1975, 1985 or 1994. Plantations can also be victims of various diseases and pests (in Colombia from 1992 to 1993).
• The low elasticity of supply:
The supply of coffee is characterized by its low elasticity especially in the short term. The short-term reaction to the offer from the producer prices and international markets is almost completely inelastic. It has been estimated by the World Bank that the elasticity of world supply in the short term (less than two years) in the producing countries is only 0.04. On a two-year cycle, this value reaches 0.11 to 0.14 in some producing countries, against only 0.10 in other approaches and 0.35 to 0.40 over the long term.
Evolution of worldwide apparent coffee consumption from 1852 to 2010 in million bags of 60kgs
Source: UNCTAD secretariat based on the statistics of the publication "150 years of coffee", Marcellino Martins & E. Johnston (1992) for the period 1952-1986 and the International Coffee Organization (ICO) for the period 1987-2010.
Note: the calculation of global consumption was derived from statistical data of the ICO using the following formula: consumption of coffee exporting countries + net imports of coffee importing countries - stocks in importing countries.
Quantitative changes in demand
Coffee is consumed largely in industrialized countries.
In terms of per capita consumption, Switzerland leads with more than 8kg of coffee consumed per year. It is followed by Canada with 5.93 kg and followed by the countries of the European Union in third place with 4.9 kg of coffee consumed per year.
U.S. is in fourth with just over 4kg of coffee consumed per year and Japan and Australia consume just over 3kg per year.
Annual consumption of coffee per capita (kg)
Source: UNCTAD secretariat based on the statistics from : "Coffee - exporter's guide", International Trade Centre (ITC) UNCTAD / WTO (2002)
Qualitative changes in demand
The tonnage and the type of coffee consumed in each country is largely influenced by factors such as size and structure of the population, per capita income, relative prices and competition from substitute products such as tea and cocoa for example and by changes in consumer buying behavior.
For example it is possible to observe a reduction in consumption of coffee in its soluble form, which has the effect of creating a depreciation in the price of robusta, from which the input is soluble in most cases produced. In addition, consumers are turning increasingly towards higher quality coffee and "beautiful" origins. This movement, initiated in the mid-80s is still relevant today and can be explained by demographic changes such as aging populations in developed countries, the main consumers of coffee, and improved income available in certain social groups.
Nearly 95% of coffee is traded in its raw form (green coffee) and the remainder (about 5%) in a processed form (roasted or soluble). Coffee can be classified into several groups.
Source: The coffee exporter’s guide (ITC)
a / Standard Classification for International Trade, Revision 3 (click here to see the classification in its entirety: http://esa.un.org/unsd/cr/registry/regcst.asp?Cl=14&Lg=1 )
b / Names of the Customs Cooperation Council
c / Harmonized Commodity Description and Coding System (http://www.bcargo.com/F/services/tarif/F05_Codes_NHM_FR.pdf )
In the last four calendar years, the value of world coffee exports averaged over US$14 billion.
In 2010, the world coffee trade generated export earnings of around US$16.5billion for producing countries.
World exports of green coffee amounted to over 90 million bags per year over 2007-2011. The two largest exporters of green coffee are:
• Brazil, which accounts for one third of world exports, and
• Viet Nam
In the category of green arabica coffee Colombia comes after Brazil, this country' export volume has averaged 9.22 million bags of green coffee per year over 2007-2011. Overall, Colombia and Brazil (61%) have accounted for over half of global exports of Arabica over the period 2007-2011.
On robusta, another Asian country, Indonesia, is the second largest exporter in the world of this type of coffee with an average of 5.96 million bags exported in the period 2007-2011, which represents about 22% of world exports. Cumulative exports from Viet Nam and Indonesia represent a higher proportion (82%) than the one from Brazil and Colombia on their side.
The leading area of green coffee importing is Europe, followed by the United States and Japan. Within the EU, the main importing countries are Germany, Italy and France. These countries re-export in general between the fifth (France, Italy) and third (Germany) part of their imports. Some other European countries serve as a gateway to Europe of coffee, coffee that is largely re-exported to other destinations. Such is the case for example in Belgium or the Netherlands.
Regarding the other members of the triad (U.S. and Japan), imported green coffee is normally not re-exported or processed form then.