| Lam3rok | Дата: Вторник, 25.10.2011, 18:19 | Сообщение # 1 |
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| THE WORLD COFFEE MARKET: ANALYTICAL OVERVIEW AND TRENDS OF CURRENT DEVELOPMENT
Krytsyna O.O.,
Delini M.M., PhD in Economics,
Donetsk State University of Management
Description of the issue. Trends on the global markets of raw commodities are to be regarded as a mooted question under current circumstances of wide-scale economical development, namely when it goes to those commodities with stable figures of consumption like grain, soybeans of coffee to name but a few. However, the situation on the coffee market is to be a subject to scrutiny due to volatile trends on this segment of the world commodities market. Far from obtaining particularly strong position on the market as compared to precious metals like gold, coffee-trade is quite sensitive to any external fluctuations. Nevertheless, having proven to be commonly used product, coffee-trade has evolved from erratic and disorderly to prosperous and quite significant industry.
Objective of the research is to find out features of modern situation on the world coffee market.
Main results. World production of coffee beans is distributed mainly between the countries of Latin America, which are to be accounted for 65% of the total harvest of coffee: Brazil and Colombia, as well as Mexico, Salvador, Costa Rica, Guatemala are the world largest producers of coffee beans. About 27% of coffee is grown in Africa, mainly in Cote d’Ivoire, Ethiopia, Angola, Uganda, etc.; the other 8% - in Asia, mainly in Indonesia, India and the Philippines. The main producer and exporter of coffee - Brazil (1/3 of the world exports of coffee); a large number of coffee on the world market is supplied by Colombia, Nigeria, Angola, Salvador, Guatemala and Mexico [1].
Generally, the largest coffee-traders remain to be vulnerable to any fluctuations on the world coffee market. As a matter of fact, the economy of these “coffee-giants” relies on the profits from coffee-trade.
For many countries, coffee exports are not only a vital contributor to foreign exchange earnings but also account for a significant proportion of tax income and gross domestic product. For seven countries the average share of coffee exports in total export earnings exceeded 10 percent in the period 2000–2010, although the importance of coffee for many countries is diminishing over time as their economies diversify. This can be demonstrated by the fact that during the period 1996 to 2000, there were 15 countries which fell into this category, i.e. the average share of coffee exports in their total export earnings exceeded 10 percent [3]. These countries are Burundi, Ethiopia, Rwanda, Honduras, etc.
The most significant figures of increase in supply of coffee in this period were demonstrated by Colombia: growth from 36.8% to 4,987 million bags. Brazil increased its volumes of supplies from basic 18,9% - up to 18,291 million bags, Vietnam increased the supplies from 11,6% - up to 8,575 million bags. While some countries proved to be quite fruitful in building up their production and exports, some others, on the contrary, reduced. For instance, exports from Indonesia fell by 25.8% and amounted 2,645 million bags [2].
It is estimated that over 125 million people worldwide are dependent on coffee for their livelihoods. But since it is a perennial crop it is not easy to switch to an alternative when prices are at today's levels [3]. At the same time, there is a mismatch of volumes of coffee for exports and those cultivated for production: the disproportionate growth of demand in the countries of Europe and in the United States contributes greatly to the aggravation of the situation on the world market of coffee. Currently due to inauspicious weather conditions producers are unable to increase production, which leads to imbalance in the market and the slowdown of economic development of the exporting countries.
Furthermore, the expansion of Brazil, Columbia, Indonesia and Vietnam has also created a surplus in stocks on global coffee market. For international organizations, it will be regarded as both part of the problem and part of the solution of current situation in the industry. On the one hand, aggressive production sector of these states will keep world prices under pressure, while its push for higher quality and willingness to work cooperatively with other countries to foster orderly marketing will be a positive influence.
References
1. Мировой рынок кофе. [Електронний ресурс] – Режим доступу: http://kernel.org.ua/novosti/mirovoi-rynok-kofe.html
2. Рынок кофе: падение либо коррекция. [Електронний ресурс] – Режим доступу: http://www.coffeetime.ru/news/market/2011-05-18-2476/
3. The global coffee crisis: a threat to sustainable development. [Електронний ресурс] – Режим доступу: http://dev.ico.org /documents /globalcrisise.pdf
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