ICO predicts coffee surplus
I don't know if this will affect the specialty coffee market.
ICO predicts supply surplus for next coffee year | Global Coffee Review
The International Coffee Organisation (ICO) estimates 2012-13 coffee production will hit 147 million bags, an increase of 12.5 million bags over the coffee year that just wrapped up last September.
This would be the first time coffee production would surpass consumption in five years. With stocks diminishing significantly in these last five years, the ICO anticipates that this would have a limited effect on prices.
Wow, 8.82 million tonnes ( I think the IOC uses a 60 kg bag weight ) that's a lot of coffee!! I wonder what the ratio of Arabica to Robusta is currently. A quick look on the web suggests it might be 70% Arabica. Some Robusta finds its' way into espresso and vice versa with Arabica and instant but that is some staggering maths! 6.174 million tonnes of Arabica, now at 20 gms a shot, that's............ making my brain hurt 8-0
I have been reading a teriffic book on the history of coffee called "Uncommon Grounds" by Mark Prendergrast.
One of the underlying themes has been the ongoing attempts by coffee producing countries to manage production and supply so as to obtain a realistic return for growers (and pickers) balanced against the ongoing objective of the buyers to push the price down to the lowest possible level.
The social/political volitility of many of the coffee producers, and the lack of a unified approach amongst them (in spite of the existence of the ICO since the '60s) has traditionally created a 'boom and bust' cycle that sees prices fluctuate wildly over time - a situation typical of most commodities.
The book does not get into the small market mechanics of the industry but one would think that the more specialised the product, the more resistent it would be to market fluctuations, particularly at the top end where most of the bean we buy comes from.
Andy would no doubt be in a much better position to comment on this than I would.