Producers Receive Small Share of Coffee Market

October 15, 2004

COFFEE-producing countriesreceive only a small portion of the worldwidecoffee industry’s total revenues.Coffee is an $80 billion industry worldwide.However, producing countries keeponly $5 billion of these revenues, accordingto the International Coffee Organization,the daily La Nación reported.The main reason behind the unevendistribution is the current productionscheme. In most cases, coffee-producingcountries export coffee beans as rawmaterial – dried coffee beans sold by thekilogram. In very few cases, coffee isexported as a final product with valueadded – roasted, ground and packaged.Gourmet coffee shops in developedcountries sell each cup of coffee for $1-2,on average. Producers are paid on average$1.95 for a kilo of coffee – fromwhich 80-100 cups of coffee can beobtained.Producers in Costa Rica and elsewherehave suffered as a result of sixyears of low prices caused by a productionsurplus on the international coffeemarket.Some Costa Rican firms, such as CaféBritt and Santa Eduviges, have succeededby selling value-added coffee directly toconsumers over the Internet, and in hotelsand specialized shops.

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