The award, named after the visionary leader of illycaffè and the son of the company’s founder, celebrates the work that the Trieste, Italy-based company has been doing every day for the last 30 years, side-by-side with coffee farmers, to offer the best possible sustainable coffee. The award was presented to the winner by illycaffè chairman Andrea Illy during an event held at the New York Public Library in New York.

EIICA celebrates the finest Arabica coffees sourced from all over the world. This event aims to recognize growers for the quality coffee they tirelessly work to produce. The award was assigned by an independent panel of nine experts who examined the best batches from the 2022-2023 harvest through a blind tasting of nine coffees from the nine finalist countries: Brazil, Costa Rica, El Salvador, Ethiopia, Guatemala, Honduras, India, Nicaragua, and Rwanda. Prior to being evaluated by the panel, each batch of coffee was analysed by illycaffè’s quality control labs and rated in terms of richness and aromatic complexity, the elegance and balance of its flavour and intensity of its aroma.

Guatemala’s Finca Danilandia di Luis Arimany Mondonico won the Coffee Lovers’ Choice Award, assigned by a panel of consumers who, in the weeks prior to the event, carried out blind taste tests of the coffee samples in illy cafés in Trieste, Milan, Paris, London, Sao Paolo and New York and ranked their preferences.

“The absolute victory of the Brazilian coffee coming from regenerative agriculture – chosen blindly among the nine best coffees in the world – fills me with joy. Indeed, the history of the Ernesto Illy Award began in Brazil in 1991 and this confirms that the rewards received, by illycaffè for having transformed Brazil from a leader in quantity to a leader in quality are well-deserved,” said Andrea Illy. “After more than 25 years of neverending and tireless work by our team of agronomists and the University of Coffee, the leap has finally happened thanks to regenerative agriculture, which we decided to develop in 2018 for the benefits it brings to the environment and everyone’s health.”

The panel that voted for the Best of the Best award included Guatemala’s professional taster Silvia Escobar; the President of Federação dos Cafeicultores do Cerrado, Brasilian Glaucio De Castro; the director of the CoffeeLab quality laboratory, Indian Sunalini Narayan Menon; chef Ricard Camarena, who has been awarded two Michelin stars and a green star for his dedication to sustainability at his Ricard Camarena Restaurant in Valencia; American chefs Carrie and Rupert Blease, who manage the Michelin-starred Lord Stanley restaurant in San Francisco; Andrea Aprea, a Michelin-starred chef with a restaurant bearing his name in Milan; French writer and journalist Adelaide de Clermont-Tonnere, editor-in-chief of Point de Vue magazine; Inga Griese, founder and editor-in-chief of ICON, the style supplement of the German newspaper Welt Am Sonntag; Angelina Villa Clarke, a journalist contributing to prestigious English-language publications including Forbes.

Commenting on the winning coffee, the jury said, “This year’s Ernesto Illy International Coffee Award winner is a rounded, wholesome, and fully bodied cup, with rich yet mellow flavors of a balance of chocolate, caramel, brown sugar, and toasted almonds on a bed of refined brightness, with a lingering finish of mild, gentle, yet harmonious sweetness. It truly represents the finest taste characteristics of its origin.”

Martha Stewart, Matilda De Angelis, Pat Cleveland, Coco Rocha, Candela Pelizza, Tamu Mc Pherson, Carlo Sestini, Simon and Marina Ksandr, Nick Lowry, Tesa Pesic are some of the celebrities who attended the gala event at the New York Public Library, hosted by chef and TV star Marcus Samuelsson, to celebrate the best coffee producers who work behind the unique illy blend.

The Ernesto Illy International Coffee Award is also an unmissable networking opportunity for all those involved in the coffee industry, from producers to exporters, from traders to institutional representatives. In the morning they all met at the United Nations Headquarters to attend a panel discussion on protecting the future of coffee. Alongside illycaffè chairman Andrea Illy, speakers included Vanusia Nogueira, executive director, International Coffee Organization; Jeffrey Sachs, professor of economy at Columbia University and co-chair at the Regenerative Society Foundation; Oscar Schaps, president of the Latin American division of Stone X Financial Inc; and Glaucio de Castro, president of the Federação dos Cafeicultores do Cerrado Mineiro. (For a full recap of the event at the UN, see the Editor’s Blog: “The time is now” to invest in regenerative agriculture (teaandcoffee.net).

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Uganda is the largest coffee exporter in Africa and the eighth largest exporter of coffee by volume in the world, yet when it comes to coffee-producing countries in Africa, Uganda is not the first one to come to mind. But the ‘Pearl of Africa’ is working diligently to change that. 

Uganda is focusing on doubling its total agricultural exports from USD $6.629 billion to USD $12 billion by 2027. Odrek Rwabwogo, chairman of the Presidential Advisory Committee on Exports and Industrial Development (PACEID), in a presentation to an international group of journalists on a government-sponsored media tour of Uganda earlier this year, said that coffee is a top target for growth. PACEID advises President Yoweri Museveni on ways to improve and increase Uganda’s export potential in a variety of sectors. 

Historically, Uganda coffee has been used for blending and not identified, but the country wants to change that by improving quality. Within coffee, Uganda’s current exports are around $627 million annually, with the goal in five years being $1.5 billion — a 28 percent increase. Rwabwogo said that further goals include growing annual coffee production from approximately seven million bags to 20 million bags by 2030.

Currently, Uganda’s major coffee export is robusta. In August, its exports rose by 48.4 percent to 0.74 million bags from 0.5 million bags in August 2022, per the International Coffee Organization. This represents the second largest monthly exports on record, just behind the 0.79 million bags exported in March 1973. Although robusta is the largest export, Ugandan officials believe there is opportunity in premium coffee (arabica), roasted coffee and soluble/instant coffee. 

Uganda’s Ministry of Agriculture, Animal Industry and Fisheries has stated that coffee is a “strategic commodity in the agro-industrialisation programme under the National Development Plan III (NDP III)’. It has been prioritised for the country’s march towards middle-income status and poverty eradication programme.” The Ministry reported that coffee provides the needed foreign exchange and is a source of income for 1.8 million households in the country that are involved in its cultivation. 

The Uganda Coffee Development Authority (UCDA), which was established in 1991, monitors and regulates the country’s coffee industry, and advises the Ugandan government on policy issues. In addition to having the responsibility of increasing quality coffee production and productivity, the UCDA is also charged with growing domestic coffee consumption. Given that coffee has been identified as the leading commodity for growth, the UCDA has devised an aggressive roadmap –it includes nine initiatives (see chart below) – to elevate Uganda’s reputation in coffee and transform its coffee sector to achieve the stated growth goals. UCDA managing director, Dr Iyamulemye Emmanuel, said that the government is undertaking a number of measures to ensure that farmers are producing coffee that meets international market standards and requirements. He noted that Uganda is looking to export to emerging markets as well as developed markets. 

Challenges to achieving growth 

The goal to raise Uganda’s coffee reputation on the global stage is ambitious and the impediments to growth in most agricultural sectors are vast: overcoming long-held stereotypes, perceived low quality because of low-standard inputs (seeds, pesticides, chemicals, banned substances still being used, etc), lack of investment, no economies of scale, minimal understanding and sharing of information relating to regulations, weak cooperatives, high transportation costs (handling fees, limited infrastructure when receiving), and most commodities go to the low end of the market and take cost-cutting measure. 

Within coffee, the biggest challenges – aside from the average age of a coffee farmer being 63 – are the lack of branding (coffee is rarely identified as being from Uganda versus origins that are highlighted such as Ethiopia, Kenya, Colombia, Brazil, etc), changing the mindset of the producers who view coffee as just a cash crop (most producers don’t even sample their own coffee), and the perception of the global coffee industry, which views Ugandan coffee overall as low quality — but the potential is there. 

Mountain Harvest, an exporter, producer and provider of farmer services based in Mbale, aims to ‘challenge the status quo of coffee production in Uganda for the sake of smallholder farmers’ as its company mission asserts. “We want to show the market that Uganda has great coffee and that we can consistently deliver it,” said managing director, Kenneth Barigye. 

Mountain Harvest produces, processes and exports organic, Fair Trade and Rainforest Alliance-certified coffee. It maintains eight processing facilities throughout Uganda, where it employs washed, natural and honey processing techniques. The Mt Elgon facilities are overseen by processing manager, Ibra Kiganda, who is also the 2023 African Fine Coffees Association barista champion. Kiganda is passionate about coffee processing and likes to experiment with anaerobic fermentation, carbonic maceration and other new techniques (using microlots grown at elevations between 1,600 and 2,200 meters above sea level). 

The majority of coffee producers in Uganda grow coffee on farms that average one acre at best, typically they are smaller. Mountain Harvest teaches producers, especially women – who do the bulk of the labour on smallholder farms in Uganda – better farming methods and techniques (such as stumping, pruning, irrigation, fertilising, using organic pesticides/weedicides, etc), and is working to change their mindsets when it comes to selling their coffee. The farmers are also taught the importance of intercropping with bananas, avocados and other trees that provide shade for the coffee as well as incremental revenue. 

Better livelihoods through better pricing 

Mountain Harvest provides micro-financing that educates producers on savings and loans, in addition to covering expenses in the off-season. The financial training builds their capacity to manage money while creating a transaction history the future lenders will require. “We are not an NGO — we do not give handouts,” asserted Barigye, noting the 2 percent interest loans the company offers to producers. “Our hope is that after three years, the farmers can go to a commercial bank that has more money.” 

The loans are ‘kick-starter financing’ for the farmers, but said Barigye, they also help build trust with the farmers so they will sell Mountain Harvest their cherries rather than process and accumulate coffee at their homes. 

Farmers receive more money for their coffee – about 20 percent more – if they sell Mountain Harvest the cherries rather than the parchment but are not always willing to do so. Company COO, Nico Herr, said that many farmers will think about when they will need money for the family (school clothes, books, etc) so they will hold onto the coffee and ‘play the market’ to see if someone else will offer them a higher price. “It is degrading the crop, but you have to consider that this is the traditional way of processing coffee in Uganda,” she explained, “we’re introducing a new way to do coffee.” 

Herr, a certified Q grader, shared that Mountain Harvest is also working to shed Uganda’s reputation for ‘fast fading’ coffees. Coffees that ‘tasted great’ on cupping tables in Mbale deteriorated during transportation oversees. They discovered that it was a warehousing issue. 

Mountain Harvest now has one of the few climate-controlled warehouses in the country and has grown over the past few years from filling three containers of coffee annually to 11. 

Recruiting youths is critical 

Instrumental to the growth of Uganda’s coffee industry is ensuring that younger generations remain interested in coffee farming and not all flee to urban areas for higher paying jobs. One factor in Uganda’s favour is that although the average age of a coffee farmer is 63, more than half the population is under the age of 18. 

“For us to have sustainable coffee production, we have to attract young people while their parents are still there to train them,” stressed Barigye. 

The government has extension programmes but it is overwhelmed so individual companies provide these services. Companies like Mountain Harvest, Endiro Coffee and Masha Coffee, with the support of the UCDA, are teaching Ugandans – both young and old – on all facets of the coffee industry: from proper farming techniques to elevate quality and improved processing and storage methods, to better record keeping, microfinancing, quality control, and how to cup, as well as training young men and women to be baristas. 

Coffee cupping at Mountain Harvest Coffee

Mountain Harvest selects the top 20 students from a local university each year to be trained in agronomy and microfinance. After six months of training and work, it offers permanent positions to the top achievers among those students. Another programme is its ‘Professional Pickers’, which hires local youth for assistance during the harvest and to do other tasks the remainder of the year. 

Ugandan officials and private sector companies realise, however, that the key to growing Uganda’s coffee industry, is through women. Women in Uganda, as in many coffee (and tea for that matter) producing countries, have not had a ‘seat at the table’. Women have long been heavily involved in the labour aspect of coffee production (picking and sorting for example) but have not had the opportunities for training and education or been involved with business transactions because of conflicting familial activities. 

Endiro Coffee and Masha Coffee are both female-owned and operated companies and work with women producers — training them in all segments of coffee production, hiring them, and of course, sourcing coffee from them. Mountain Harvest also taps women to be its team leaders (most farms are still owned by men) so they are also involved on the business side. 

“We have found that when the women handle the money, there is more for the children for clothing and school items, for food and savings,” said Millie Drijaru, head of coffee, Endiro Coffee. Both Barigye and Sylvia Achebet, executive director of Masha Coffee echo the sentiment. 

Endiro Coffee was founded in Kampala in 2012 by Gloria Katusiime as a café to provide employment opportunities to Ugandan youths. In 2014, Endiro switched from buying roasted coffee to sourcing green coffee directly from Ugandan farmers, paying them a premium for their high quality beans. It partnered with a roaster in Kampala for its blends. 

Endiro started with 50 farmers that formed the Endiro Growers Bukalasi Women’s Group, which has now grown to a network of more than 500 farmers across four growers groups throughout Uganda. Endiro offers training and support, and in return is receiving higher quality coffee and greater yields, which allows it to offer farmers better prices, thereby improving their livelihoods. Endiro Coffee, which received its B Corp certification in 2019, now operates 14 coffee shops in Uganda, one in Kenya and one in Aurora, Illinois. It plans to open its own roastery in Uganda this year. 

Kween-based Masha Coffee buys coffee cherries from a network of nearly 1,000 female-led farms –ranging in elevation from 1,800 to 2,400 meters above sea level – in the Kween, Kapchorwa and Bukwo districts. Masha sends field officers to train local farmers in best practices multiple times throughout the year. Trainers offer guidance on agronomy methods from planting seedlings to soil management to harvesting, etc, and said technical manager, Eunice Chekaptui, “how to be environmentally friendly,” – all to ensure a consistent supply, which benefits both Masha Coffee and the farmers. Masha Coffee also hires local youths to assist with production and processing in Kween. 

Endiro Coffee’s shop in Sipi Falls at Lacam Lodge

Masha Coffee has begun shipping roasted coffee to wholesale customers internationally and is exploring distribution opportunities in other countries, including the United States. The coffees Masha processes in Kween are carried in parchment to facilities in Mbale for hulling, and then to Kampala for roasting and packaging. Having to haul the coffee to so many different facilities and towns is costing Masha “time, money and security,” said Achebet, noting her dream would be “to have everything done here.” She said that having everything done in one place would reduce risks. First up would be purchasing a huller, with roasting being the final phase of the plan. 

Joining forces to meet demand 

Along with 16 other Uganda companies, Masha Coffee is a member of the Coffee Investment Consortium of Uganda (CICU), a Ugandan trade group that shares resources and connections to meet international demand. 

By collaborating to deliver higher volumes of higher quality Uganda coffee on the global market, the CICU’s mission is to attract investments specifically to cover expenses and the cost of exporting. Nelson Tugume, CEO of Inspire Africa and chairman of the CICU, said there is no export financing, no available or product-oriented credit. “Coffee is different from other commodities like bananas, from a manufacturing and housing [perspective], therefore you need a particular [type] of financing.” 

PACEID is consulting with financial groups and institutions, including lenders, equity funds, foundations and the Uganda Bankers’ Association to develop an export credit fund that will provide affordable financing for producers of coffee and other products. And while many are hopeful such a fund will be established and available soon, the CICU believes time is of the essence. “[International] buyers are saying they want to buy the coffee directly, [but are asking] ‘do you have what it takes?’,” said Tugume. He shared that Uganda needs to create a better environment for investors to bring in the financing. “In terms of production, the farmers can manage it, if you give them a better price. They can manage it at the production level, [but the difficulty] is in the market.” 

The UCDA, along with Mountain Harvest Coffee, Endiro Coffee, Masha Coffee and other CICU members firmly believe that as more companies start producing higher quality, Uganda’s profile will be elevated. “The market is going to know Uganda as an origin,” said Barigye, “and it’s going to appreciate Uganda as an origin because we have great coffees.” 

•  Vanessa L Facenda joined T&CTJ in 2012 as editor. She was previously editor of Retail Merchandiser and has written for a variety of magazines including Consumer Reports, Brandweek, Adweek, Hollywood Reporter, and Specialty Food Magazine, among many others. She may be reached at: vanessa@bellpublishing.com. 

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Going forward, the private sector and civil society will participate as Affiliate Members in key discussions and decisions on the sustainable future of global coffee affairs with 75 coffee producing and importing nations, ICO Member Governments. The goal of the 2022 International Coffee Agreement (ICA) is to find new ways to improve conditions in an over USD $300 billion a year industry that provides a livelihood for millions of people from farmers to baristas across the world. Indeed, coffee farmers have suffered much in the wake of a 2019 coffee pricing crisis, extreme weather including droughts, flooding, frosts and blight, resulting in crop losses and prompting many to quit a business that had been in their family for generations. Smallholders, who only have less than one or two hectares of land each to produce coffee, for example, are the most vulnerable with incomes of just USD $500 a year.

The chair of the International Coffee Council (ICC), H.E. Ambassador Iván Romero-Martínez of Honduras, stressed that with the approval of the new ICA, the ICC marked a new era for the ICO, its members, the global coffee sector and for millions of coffee farmers whose work, every day, allow us to taste a wonderful coffee. He further pointed out that ICO members showed the world that the coffee sector is strong and united as ICO reaffirms itself as the centre of the ‘coffee diplomacy’, committed to making the coffee value chain more sustainable, inclusive, and resilient.

“We are entering a new era of cooperation with the private sector thanks to the landmark International Coffee Agreement 2022,” said Vanusia Nogueira, who joined in May as the ICO’s first female executive director. “The arrival of the world’s biggest high-street names and manufacturers as well as smallholders means that the whole coffee value chain can now address the biggest challenges facing the global sector in a way that is fair for all,” she added.

The new ICA goes beyond the traditional divide between exporting and importing members as all members are committed to working together to address the increasing challenges of the coffee industry. The private sector and government entities will coordinate strategies to address more efficiently those challenges. This will benefit producers across 50 countries as coffee growers and their associations will be able to raise their concerns directly with retailers and manufacturers.

Moreover, the new ICA gives a clear and firm mandate to the ICO Secretariat to assist members in putting together coffee sector development projects and mobilising resources in areas such as pest and disease control, climate change adaptation among other mitigating strategies. This comes at a time when expanding demand for coffee will contribute to maintaining a balance between supply and demand, supporting fair market prices.

“The industry has changed dramatically in the last 30 years in terms of governance and value distribution between producing and consumer nations. We can now come together and put a bigger emphasis on the development of the global circular coffee economy. Ultimately, we want to create a brighter future for millions of coffee farmers by adhering to the United Nations’ Sustainability Development Goals and work for more transparency, quality and fair pricing for billions of consumers. The new agreement is a huge step in this direction,” said Nogueira.

The new ICA represents a fresh mandate for the ICO. It is the seventh of its kind since 1962 after the first International Coffee Agreement at the United Nations in New York defined coffee export quotas. The 2022 ICA has come a long way since then, now that the ICO can bring all parties to the table for the first time and tackle challenges through international private and public cooperation, involving its member governments, which represent 93% of world coffee production and 63% of world consumption. Today, the world drinks more than two billion cups of coffee a day.

“The new agreement is an effective instrument to paving the way to a more unified front, establishing a consensus and shared vision on how to best implement and promote actions by governments and the private sector, while also engaging all key coffee-related institutions, NGOs, international and financial institutions plus other development partners, research bodies and academia,” said Nogueira, who previously represented Brazil, the world’s biggest coffee producer, in global coffee affairs as the executive director of the Brazilian Specialty Coffee Association.

While the ICO will not change its intergovernmental nature, as part of the Agreement, the current Coffee Public-Private Task Force has been integrated into the ICO as the Coffee Public-Private Working Party. On top of this, the Private Sector Consultative Board will be transformed into the Board of Affiliate Members, creating a new institutional framework and leading to the non-government affiliation since 1963 when the ICO was established in London.

The ICA’s key points also redefine the ICO’s internal voting system and members’ contributions to better reflect the transformation in the global coffee chain over the last 30 years, accounting for distortions between producing (exporting) and consumer (importing) countries as well as Arabica versus Robusta coffee-producing nations. The change in membership contributions to the administrative budget will increase the financial sustainability of the Organization and its capacity to carry out its mandate.

In terms of production, the world produces 4.18 million tonnes of Robusta coffee, or 69.67 million 60-kg bags a year, and 6.07 million tonnes of Arabica, or 101.16 million 60-kg bags, annually as of 2020. This is up from 1.74 million tonnes of Robusta and 4.34 million tonnes for Arabica coffee in 1991.

For more information, visit: ico.org.

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The ICO Composite Indicator Price (CIP) lost 7.6% from February to March 2022, averaging 194.78 US cents/lb for the latter. This marks a break to the 17 consecutive months of CIP increase. A low of 186.85 US cents/lb was recorded on 15 March 2022, whilst the CIP peaked on 1 March at 202.00 US cents/lb.

Every group of coffee lost value relative to the previous month, with the Brazilian Naturals losing the most at 9.4%, falling from 245.05 in February 2022 to 222.03 US cents/lb in March 2022. Prices for Other Milds decreased by 7.6% to 258.49 US cents/lb from 279.83 US cents/lb. However, the prices for Colombian Milds and Robustas, decreased by 6.7% and 5.1%, to 285.81 US cents/lb and 103.82 US cents/lb respectively.

The average of the second and third position of the New York futures market decreased by 9.4% from 245.38 US cents/lb to 222.44 US cents/lb, February 2022 to March 2022, whilst the Robusta futures market decreased by 5.3% from 100.58 US cents/lb to 95.21 US cents/lb, over the same period. Arbitrage between the London and New York futures markets decreased by 12.1 %, falling from 144.81 US cents/lb in February to 127.23 US cents/lb in March 2022. The differentials between the Colombian Milds and Other Milds increased for the eighth consecutive month, rising to 27.33 US cents/lb. The Colombian Milds and Brazilian Naturals differential outperformed the Colombian Milds and Other Milds differential by 1.0 percentage point, rising from 61.30 US cents/lb in February 2022 to 63.79 US cents/lb in March 2022- also increasing for eight consecutive months. The Other Milds and Brazilian Naturals differentials grew the most, from February to March 2022, increasing from 34.78 US cents/lb to 36.46 US cents/lb.

However, the Brazilian Naturals and Robustas differentials suffered the biggest loss from February to March 2022, losing 12.8% from 135.61 US cents/lb to 118.21 US cents/lb. Changes in the differential between the Colombian Milds and Robustas were down 7.6%, falling from 196.92 US cents/lb to 181.99 US cents/lb, while the Other Milds and Robustas differential suffered a 9.2% loss, down from 170.39 US cents/lb to 154.66 US cents/lb from February to March 2022.

Intra-day volatility for the ICO CIP grew by 1.3%, from 7.3 to 8.6 over February-March 2022. The London futures market presented the largest variation of volatility in between February and March 2022, up by 2.5% from 5.2% to 7.7% in the respective months. The Brazilian Naturals exhibited the greatest volatility among all groups of coffee at 11.5% in March 2022, growing by 1.8% from the previous month. The New York futures market helped drive up the CIP’s volatility as it grew by 1.4% from February to March 2022, reaching 10.4%. Colombian Milds and Other Milds both gained 0.6% of volatility, reaching 8.4% and 9.0% respectively, whilst Robustas, during the same period, gained 1.3% to 7.9% volatility in March 2022.

Certified stocks at the close of March 2022 reversed the previous drawing down trend as NYBOT gained 13.9% from February 2022, up from 1.08 million bags to 1.23 million bags. LIFFE certified stocks grew by 0.09 million bags, or 5.8% during that same period, up 1.54 million bags to 1.63 million bags.

Global exports of green beans in February 2022 totalled 9.88 million bags, compared with 10.24 million bags in the same month of the previous year. Exports reached 47.18 million bags in the first five months of coffee year 2021-22, a decrease of 3% as compared with 48.65 million bags for the same period in coffee year 2020-21. A decrease in shipments of Brazilian Naturals is the main reason behind the drop in global exports of green beans, with that country’s shipments falling by 7% in February 2022 to 3.35 million bags, from 3.60 million bags in February 2021, and by 15.7% over the first five months of coffee year 2021-22, which were 16.20 million bags, compared to 19.21 million bags in the same period a year ago. Specifically, the underlying reason for the fall lies with Brazil, which is still dealing container and shipping problems along with a smaller crop harvested during its Arabica ‘off-season’. Colombian Milds also contributed towards the fall in the global exports of green beans, decreasing by 19.6% to 1.06 million bags from 1.32 million bags over February 2022 to February 2021, and by 12.7% to 5.41 million bags in October-February 2022-21 from 6.20 million bags in October-February 2020-21.

Shipments of the green Other Milds increased by 6.6% in February to 2.10 million bags from 1.97 million bags in the same period last year. For the first five months of coffee year 2021-22, exports of green Other Milds were 8.19 million bags as compared with 6.95 million bags in October-February 2020-21, a 17.8% increase. Exports of Robusta were 3.37 million bags in February 2022, as compared with 3.35 million bags in February 2021, up 0.5%. Exports of green beans for the first five months of the current and previous coffee years for Robusta are 17.39 million bags and 16.30 million bags, respectively, up 6.7%.

In October 2021 to February 2022, South America’s exports decreased by 14.5% to 24.99 million bags. During this period, shipments from Brazil declined by 20.3% to 16.98 million bags from 21.31 million bags in October-February 2020-21. Continuing issues with availability of containers and shipping capacity, albeit with reported improvements in recent weeks, and a smaller crop harvested during its Arabica “off-season” are the main reasons for the sharp fall. Colombian exports fell by 22.9% in February 2022, with volume of coffee shipments falling to 991,000 bags from 1.29 million bags in February 2021. In the first five months of coffee year 2021-22, Colombia’s exports fell by 10.5% to 5.34 million bags, from 5.97 million bags in the same period a year ago. The fall in the exports is linked to persistent unfavourable weather conditions reducing the available supply of coffee in the country.

Exports from Asia and Oceania increased by 25% to 3.96 million bags in February 2022, and by 21.6% to 18.67 million bags in the first five months of coffee year 2021-22. Vietnam’s exports, during these periods, increased by 25.9% to 2.39 million bags and 19.1% to 11.64 million bags, respectively. These sharp increases are technical, reflecting the sharp decreases in the same periods last year, down 34% and 16.4%, respectively, due to logistical issues – shortage of available shipping containers, rising freight costs, and port congestion at destinations in the United States and Europe. India’s shipments increased by 10.6% to 612,000 bags and by 48.8% to 2.78 million bags. Exports from Indonesia increased by 35.9% to 864,000 bags in February 2022, and by 16.5% to 3.62 million bags in October-February 2021-22. The large increases of total exports are due to the success of the country’s soluble coffee industry, shipping 1.12 million bags in October-February 2021-22 as compared with 0.74 million bags in October-February 2020-21. In fact, since the same period in coffee year 2017-18, exports of soluble coffee have almost doubled, rising from 0.58 million bags.

Exports from Africa decreased by 11.9% to 975,000 bags in February 2022 from 1.11 million bags in February 2021. For the first five months of the current coffee year, exports totalled 5.01 million bags as compared with 5.05 million bags in coffee year 2020-21. Uganda is the main reason for the region’s sharp drop in the February exports, which is attributed to lower production stemming from droughts in some parts of the coffee-growing regions of the country. In February, exports of Uganda fell by 20.2% to 449,000 bags as compared with 563,000 bags in February 2021. However, for the five months of coffee year 2021-22, exports are still growing, increasing to 2.4 million bags as compared with 2.29 million bags over the same period a year ago. Ethiopia’s exports fell marginally in February 2022, down to 160,000 bags from 163,000 bags in February 2021. However, for the first five months of coffee year 2021-22, its exports are up 24.6%: 1.12 million bags versus 0.96 million bags. In contrast, exports of Tanzania increased by 26.3% in February 2021 to 127,000 bags from 100,000 bags in February 2021, while falling for the first five months of the current coffee year, down 5.1% to 530,000 bags from 558,000 bags in October-February 2020-21.

In February 2022 exports from Mexico and Central America dropped by 4.1%, to 1.47 million bags as compared with 1.53 million in February 2021. However, for the first five months of the current coffee year, exports are up by 13.4%, totalling 4.58 million bags as compared with 4.04 million bags in October-February 2020-21. Honduras, the region’s largest producer, is the main reason for the region’s fall in exports in February, suffering a 21.7% drop to 503,000 bags from 642,000 bags in February 2021. The Honduran Association of Exporters of Coffee (AHDECAFE) has linked the decrease in exports to falling production, due to the impact of biennial drop on output and the presence of coffee leaf rust disease. In Mexico, the region’s second largest exporter, exports in February 2022 increased by 3.7% to 252,000 bags from 243,000 bags. For the first five months of coffee year 2021-22, exports increased by 12.7% to 1.15 million bags from 1.02 million bags in the same period a year ago. Exports from Guatemala increased by 5.5% in February 2022 to 299,000 bags from 283,000 bags in February 2021. For the first five months of coffee year 2021-22, exports increased by 15.5% to 810,000 bags from 702,000 million bags in the same period a year ago.

Total exports of soluble coffee grew by 64.9% in February 2022 to 1.46 million bags from 888,000 bags in February 2021. In the first five months of coffee year 2021-22, a total of 5.71 million bags of soluble coffee has been shipped, an increase of 21.7% from 4.70 million bags exported in the same period during the previous coffee year. As a result, the share of soluble coffee of the total exports of all forms of coffee has risen to 10% (measured on moving 12 months average) in February 2022 from 9% in February 2021. Brazil and Indonesia are the two main countries responsible for the absolute and relative growths in the exports of soluble coffee, with 14.6% and 50.4% expansions, respectively, in the first five months of coffee year 2021-22 as compared to the same period last year.

Exports of roasted beans increased by 4.2% in February 2022 to 61,182 bags from 58,733 bags in February 2021.

The latest provisional outlook for total production in coffee year 2021-22 remains unchanged at 167.2 million bags, a 2.1% decrease as compared to 170.83 million bags of the previous coffee year.

World coffee consumption is projected to grow by 3.3%, to 170.3 million 60-kg bags in 2021-22 as compared to 164.9 million for coffee year 2020-21. In 2021-22, consumption is expected to exceed production by 3.1 million bags. Supply and demand trends may be affected by variations due to the downturn in the world economy, increased cost of inputs and production as well import and consumption due to the conflict in Ukraine.

For the full report, visit: ico.org.

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The most important item on the agenda was the draft text of the new International Coffee Agreement 2022, the result of decisions made in twenty-eight meetings of the Working Group on the Future of the Agreement. The new agreement has been reviewed to improve international cooperation among all coffee stakeholders both at the public and private levels, so as to achieve a sustainable and resilient coffee sector with a specific focus on the livelihoods of coffee farmers and other producers. The revised structure of the agreement – which foresees the transformation of the Coffee Public-Private Task Force into a permanent Working Party – bears witness to the recognised need to enhance dialogue and build new partnerships with the private sector and civil society to jointly address common challenges such as climate change and the negative repercussion of the Covid-19 pandemic.

A new system for the calculation of votes and contributions that better reflects the reality of the coffee global value chain is also expected to be introduced to promote a fairer distribution of financial commitments among Members and enhance the financial sustainability of the ICO. The Council decided to hold a Special Session on 8 and 9 June 2022 to consider the adoption of the new Agreement.

The Council expressed its appreciation and praise for the advances the Coffee Public-Private Task Force has made in the mobilization of a substantial amount of resources to carry out the transformation of the coffee sector thanks to the high-impact engagement with all actors of the global coffee value chain in a variety of areas, including living and prosperous income for coffee growers, market transparency, building resilient coffee landscapes addressing also gender transformation and deforestation. In the spirit of ensuring continuity to the activities of the Task Force, ICO Members approved the concept note for an overall funding proposal for the period 2022-2026, as well as the proposal from Technical Workstream 3 ‘Sector Transformation – Exporting Members’ containing specific actions for the benefit of coffee producers and stakeholders facilitated by the United Nations Development Programme (UNDP) and by the Global Coffee Platform (GCP).

In view of the discussions in the Private Sector Consultative Board following a presentation by the European Coffee Federation (ECF) on the new draft Directive on Deforestation, the Council requested the Secretariat to continue monitoring and establish appropriate mechanisms, possibly within the CPPTF so that the ICO could voice the interest as well as the concerns of all coffee stakeholders before the European Union.

Members also appointed Massimiliano Fabian of EU-Italy as the new vice chair of the International Coffee Council, as well as Zoltan Agai of the European Commission as chair of the Finance and Administration Committee (FAC) for coffee year 2021-22. ICO Members and the Secretariat expressed their gratitude to José Sette for his five years of service (2017-2022) as the executive director of the ICO and for the achievements obtained for the benefit of the global coffee sector under his leadership. On 1 May, Sette will be succeeded by Vanúsia Maria Carneiro Nogueira, the first woman to lead the ICO since its creation.

The Council will resume in-person meetings starting with the last session of coffee year 2021-22, which will be held in Bogotá from 3-7 October 2022 following the generous offer made by the Government of Colombia to host the 134th Session of the Council.

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The ICO composite indicator rose to 97.74 US cents/lb in September 2019, increasing 1.7% from August 2019. Brazilian Naturals saw the largest increase, climbing 3% over the month to an average of 98.73 US cents/lb. Colombian Milds and Other Milds increased by 2.1% to 131.90 US cents/lb and 128.89 US cents/lb, respectively. The group indicator for Robustas, on the other hand, dropped to its lowest monthly average since April 2010, falling 0.2% to 70.64 US cents/lb in September 2019. A consecutive two-year increase in Robusta production, driven primarily by Brazil and Vietnam, has contributed to the decline. Coffee prices have averaged 100.47 US cents/lb in coffee year 2018/19 so far.

Arbitrage between Arabica and Robusta coffees, as measured on the New York and London futures markets, increased by 9.1% to 42.50 US cents/lb, pushed both by a 2.9% increase in the New York futures market and a 1% decline in the London market. The decline drove the London futures market to its lowest level since March 2010, mirroring the fall in Robusta indicator prices.

Production increase driven by Robusta growth

World production in coffee year 2018/19 is estimated to be 3.7% higher at 168.87 million bags, which includes part of the new crop for producing countries with crop years commencing in April and July. Production of both Arabica and Robusta increased in 2018/19, though the majority of the increase came from Robusta, which grew 6.7% to 66.04 million bags compared to coffee year 2017/18. Arabica production increased by 1.8% to 102.68 million bags. Output rose in all regions except for Mexico & Central America, where the harvest declined by 0.8% to 21.47 million bags. Nearly half of the world’s coffee was produced in South America, where production is estimated 4.8% higher at 80.95 million bags in coffee year 2018/19. Production grew by 4.6% in Asia & Oceania to 48.46 million bags, while output in Africa rose by 1.9% to 17.99 million bags.

2018/19 shipments have already surpassed those of 2017/18

The larger supply in coffee year 2018/19 is reflected in increased shipments. In the first eleven months of coffee year 2018/19, world coffee exports were 9.2% higher than in the same period for coffee year 2017/18, amounting to 120.28 million bags, already surpassing the total volume shipped in coffee year 2017/18.

Shipments of Colombian Milds rose by 8.6% to 13.88 million bags, while Brazilian Naturals grew by 25.4% to 38.57 million bags. Colombia’s shipments rose by 7.8% to 12.53 million bags in October 2018 to August 2019. Tanzania and Kenya also shipped more coffee during this period, with their exports rising by 47.4% to 1.04 million bags and by 11% to 743,203 bags, respectively. Brazil saw an increase of 31.1% to 38.72 million bags, however, shipments from Ethiopia decreased by 4.8% to 3.23 million bags.

Exports of Other Milds fell by 4.1% to 24.99 million bags in October 2018 to August 2019. Shipments decreased in six of the ten largest members of this group during this period. Exports from Honduras fell by 5.1% to 6.57 million bags, from Peru by 7.3% to 3.14 million bags and from Mexico by 11.7% to 2.53 million bags. However, Guatemala’s shipments during this period rose by 5% to 3.34 million bags, and exports from Nicaragua rose by 13.2% to 2.64 million bags.

Robusta shipments increased by 5.6% to 42.84 million bags in the first eleven months of coffee year 2018/19. Vietnam is the world’s largest exporter of Robusta coffee and its total shipments increased by 3.9% to 24.97 million bags. However, India’s exports declined by 5.6% to 5.62 million bags, and Indonesia’s exports decreased by 9.8% to 4.82 million bags. Uganda’s exports remained stable, increasing by 0.6% to 4.09 million bags in October 2018 to August 2019. Côte d’Ivoire’s shipments grew by 49.1% to 1.62 million bags, offsetting the 8.4% decrease in exports from the Lao People’s Democratic Republic, amounting to 323,291 bags.

While shipments to date for the coffee year are higher, exports in August 2019 decreased by 4% to 10.45 million bags compared to August 2018. Arabica shipments decreased by 2.3% to 6.54 million bags, and Robusta by 6.6% to 3.9 million bags. The decrease in Arabica shipments was led by Other Milds, which fell by 15.3% to 1.99 million bags in August 2019, while exports of Brazilian Naturals remained stable at 3.27 million bags. Exports of Colombian Milds, however, rose by 18.3% to 1.29 million bags.

Global coffee consumption is estimated to have risen by 2.1% in coffee year 2018/19 at 164.82 million bags. Consumption in importing countries grew by 2.4% to 114.51 million bags while exporting countries’ consumption rose by 1.3% to 50.31 million bags, which represents 30.5% of world consumption.

Coffee production in 2018/19 exceeded global consumption by 4.05 million bags, which marks the second year of surplus. The total cumulative surplus is 5.48 million bags. This surplus has contributed to the low prices this coffee year, with the composite indicator averaging 100.47 US cents/lb for October 2018 to September 2019. In comparison, the average for the composite indicator in 2017/18 was 111.51 US cents/lb, and in 2016/17 was 132.43 US cents/lb. Additionally, exports in coffee year 2018/19 set a new record and put further pressure on prices.

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Average prices for the Arabica group indicators rose in July 2019. Prices for Brazilian Naturals experienced the largest increase, averaging 105.43 US cents/lb, 4.7% higher than in June 2019. Other Milds increased by 4.4% to 135.47 US cents/lb while Colombian Milds rose 3.1% to 137.63 US cents/lb. In contrast, Robusta prices decreased by 0.1% to 73.93 US cents/lb, which is 13.3% lower than the start of the coffee year.

In July, the arbitrage between Arabica and Robusta coffees, as measured on the New York and London futures markets increased for the fourth consecutive month to 44.18 US cents/lb, 13.2% than in June 2019.

June exports rise by 3%

In June 2019, world coffee exports rose by 2.8% to 10.94 million bags compared to June 2018. This growth was led by shipments of Colombian Milds, which grew by 19.9% to 1.23 million bags. Exports of Brazilian Naturals grew by 8.8% to 2.91 million bags, while exports of Other Milds rose by 0.6% to 2.93 million bags. Robusta exports decreased by 4% to 3.86 million bags in June 2019.

Production estimates revised

In coffee year 2018/19, world production is estimated at 168.77 million bags, one million bags higher than estimated in the June report. Arabica output is estimated at 103.79 million bags, accounting for 61% of production, and Robusta is estimated at 64.98 million bags, representing 39% of the total. Output in the five largest producers this coffee year would account for 73% of world production.

Brazil’s production in crop year ending March 2019 increased by 18.5% to 62.5 million bags, which is reflected in the 20.6% increase in its exports this period, reaching 37.13 million bags. Brazil’s Robusta production has recovered from the previous drought as evidenced by the growth in green Robusta exports.

Vietnam’s production is estimated to be 1.3% lower at 30 million bags as adverse weather conditions affected the yield in crop year 2018/19. Its exports in the first nine months of the year declined by 3.9% to 21.1 million bags.

Output from Colombia is estimated at 13.95 million bags in 2018/19, 1% higher than last year.  Its shipments of soluble exports have grown steadily in recent years. In 2015/16, soluble exports represented around 5% of total exports, while in 2018/19 they represent around 6%. Colombia’s imports in the first half of coffee year 2018/19 increased to 865,024 bags from 288,115 bags during the same period in 2017/18, with imports of green coffee accounting for 95.8% of total imports this year.

Indonesia’s production declined by 5.6% to 10.2 million bags, and shipments declined by 33.7% to 5.15 million bags in its crop year ending March 2019. In addition to the decline in output, steadily increasing consumption has reduced the availability of coffee for exports. Around 75% of Indonesia’s green coffee exports are shipments of green Robusta, which reached 2.06 million bags in the first nine months of the coffee year compared to 2.44 million bags last year. The share of soluble in the total exports has increased from 5.9% in 2010/11 to 20.7% in 2018/19.

Production in Ethiopia is estimated at 7.5 million bags, 0.6% higher than in crop year 2017/18. While Ethiopia is the world’s fifth largest producer, it is the ninth largest exporter given the high rate of domestic consumption. In 2018/19, Ethiopia’s consumption is estimated at 3.8 million bags, which represents 50.7% of its expected output.

World coffee consumption is estimated 2.1% higher in coffee year 2018/19 at 164.84 million bags with the largest growth in Asia & Oceania where demand rose by 3.6% to 35.91 million bags. Despite this growth, world production is expected to exceed consumption by 3.92 million bags, resulting in a cumulative surplus of 8 million bags over the last two seasons.

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