writeup.md

Global Coffee Trade writeup

Team members: Cindy Wong and Sandra Botica

Project Overview

This project looked at coffee exports, price paid to grower's, imports and retail prices from 1990-2019.

Coffee as a discretionary commodity and the impact rising inflation and low economic growth has on the consumer spending on coffee.

Factors that impact supply and demand.

• climate such as adverse weather conditions.
• stock inventories.
• supply chain disruptions such as global fertiliser costs and freight costs.
• the number or countries producing coffee.
• potential for investment in the industry.

Acknowledgments

Data sourced from the International Coffee Organization.

Historical Data on the Global Coffee Trade. https://www.ico.org/new_historical.asp

• Trade Statistics Data - Exports - Calendar Year (excel), Thousand 60kg bags.
• Trade Statistics Data - Imports - Calendar Year (excel), Thousand 60kg bags.
• Price Data - Prices to Growers - Annual Averages (excel), US cents/lb.
• Price Data - Retail Prices - Annual Averages (excel), US dollars/lb.

Our purpose was to gain insight into the Countries and volume of imports and exports from 1990-2019.

We were also interested in comparing prices paid to growers and retail prices.

Below are the questions we explored and key findings for each.

1. The number of countries exporting/ producing coffee and at what volume?

• Top 5 coffee exporters are Brazil, Vietnam, Columbia, Indonesia & India. Brazil exporting nearly twice the amount of coffee then all other countries.

• There were 55 countries in this dataset. Most of these countries were small to medium scale exporters, indicating thatn this industry and the ICO have done well in facilitating farmers and local communities to produce and trade.

• Exports were impactedreduced after global events such as the Asian Financial crisis in 1997 and the Global Financial crisis in 2007.

• The impact of climatic events was also displayed in the data e.g. Brazil's exports reduced after 2014 high temperatures and drought.

2. The number of countries buying/importing coffee and at what volume?

• Top 5 coffee importers are USA, Germany, Italy, Japan & France. Each of these countries had a steady rise in imports, except for Japan who have experienced declining imports after 1997.

• Of the 35 countries in the dataset, 32 were European. 26 countries have inclining importing volumes over 1990-2019.

3. Have imports and exports risen over time?

• Yes, a line graph of total yearly volumes for both imports and exports was plottted as a line graph and indicated rising volumes.

4. Prices paid to growers for exporting country over the time and the retail prices for importing countries.

• The mean retail price and price paid to grower's per year, was also plotted on a line graph. Retail prices were higher,especially after 2002, and these may be due to rising retail expenditure e.g. transport/wages/outlet expenses.

• Price paid to growers was fairly flat or consistent over the years.

Further questions to explore about the Global Coffee Trade.

• Investigate countries and volumes of coffee type e.g. arabica vs robusta.

• Analyse regional exports e.g. Africa, Asia/Oceania, Central America & Mexico and South America.

• The impact of adverse weather and global fertilizer costs.

• Developing a better understanding how retail prices were determined by the ICO.

• The amount of trade in dollars using data from the World Bank.org

Limitations with the data.

• Small number of countries

• Use of pounds and Us cents/lb

• Understanding the annual average of price paid to grower as documents from the ICO reference a price guarantee by governments to growers.

• ICO’s method of aggregation of values for analysis. Does it represent production on the ground within each Country?

This project has revealed the Global demand for coffee does not appear to have been affected by decelerating global economic growth or rising cost of living.

Data post 2019 may reveal a different trend.