CI-2018咖啡晴雨表（英文）-2018.12-36页-1mb

Coffee Barometer Summary

Core Content

The Coffee Barometer provides an in-depth analysis of the global coffee industry, highlighting the current market trends, the concentration of power among stakeholders, and the pressing sustainability challenges facing coffee producers. It explores the structural imbalances in the value chain, the impact of climate change and deforestation, and the role of sustainability strategies in shaping the future of the coffee sector.

Main Trends and Market Dynamics

• Market Consolidation: The global coffee industry is consolidating through a wave of mergers and acquisitions, with major players such as Nestlé, JAB Coffee, and Lavazza dominating the market.
  • JAB Coffee has acquired over 35% of the world's coffee brands and is expanding into new markets, including RTD (Ready to Drink) coffee and restaurant chains.
  • Nestlé is strengthening its position in the specialty coffee market by collaborating with Starbucks and expanding its portfolio through acquisitions.
  • Lavazza is aiming to become a global brand by acquiring specialty coffee companies in Europe and North America.
• Market Structure: The coffee market is buyer-driven, with roasters, traders, and retailers maintaining high levels of opacity and capturing most of the value.
• Consumer Trends: There is a growing demand for premium, customised, and single-origin coffee, which is pushing the industry towards specialty coffee and direct sourcing initiatives.
• Coffee Consumption: Coffee consumption is rising outside the traditional EU and USA markets, particularly in Southeast Asia, which could lead to a significant increase in global demand.

Key Issues and Stress Factors

1. Value Distribution and Profit Sharing

• The global coffee value chain is highly imbalanced, with farmers receiving only 10% of the total industry value, despite producing the majority of the coffee.
• Price volatility and low returns for farmers are major stress factors, affecting both their income and investment in sustainable practices.

2. Wages and Labour

• Low wages and labour shortages are prevalent, especially during harvest periods.
• Smallholder farmers often lack access to education, healthcare, and financial services.
• Women are underrepresented in the workforce, facing gender inequality, discrimination, and limited opportunities.
• Youth migration away from coffee farming is increasing due to poor income prospects and lack of future opportunities.

3. Climate Change and Deforestation

• Climate change is impacting coffee production by altering temperature, rainfall, and pest dynamics, leading to reduced yields and quality issues.
• Deforestation is increasing to meet growing coffee demand, especially in countries like Vietnam, Indonesia, and Ethiopia.
• Shade-grown coffee is more sustainable and offers better long-term economic and environmental benefits, but it is often less profitable in the short term.

Sustainability Strategies and Commitments

• Certification and Verification: Stakeholders are increasingly procuring certified and verified coffee to ensure sustainability, but smallholder producers in Africa and Asia are often excluded from these systems.
• True Pricing: Incorporating external costs (e.g., environmental and social impacts) into pricing models is essential for sustainable coffee production.
  • Example: In Mexico, the true price of conventional coffee is $11.10, while the market price is only $3.30.
  • Climate-smart coffee (CSA) offers a better return on investment due to higher yields, environmental benefits, and carbon sequestration.
• Market Demand: The specialty coffee sector is driving direct sourcing and traceability, offering potential for positive change.
• Collaboration: There is growing support for non-competitive collaboration between public and private sectors to address sustainability challenges at scale.

Sector Collaboration and Initiatives

• Global Coffee Platform (GCP), Sustainable Coffee Challenge (SCC), and national sustainability platforms are working to align sustainability goals across the industry.
• Despite these efforts, collective investments in sustainability remain a challenge, as many companies are focused on individual brand strategies rather than sector-wide transformation.
• Multi-Stakeholder Initiatives (MSIs) are crucial for systemic change, but their effectiveness is still limited.

Conclusion

The Coffee Barometer highlights the need for greater transparency, fair value distribution, and sustainable practices in the coffee industry. While there are opportunities for positive change through specialty coffee growth and collaboration, the current market consolidation and lack of systemic change are posing significant challenges. Sustainability is becoming a more central issue, but it requires collective action and policy support to be effectively implemented across the value chain.

Key Statistics

• Coffee production has grown by over 20% since 2010.
• 20–25 million smallholder farmers produce 70% of the world's coffee.
• The average green coffee export value is less than 10% of the $200 billion coffee retail market.
• 60% of suitable coffee land in 2050 is currently forested, with only 20% under formal protection.
• 4 million hectares of smallholder coffee land require renovation and rehabilitation.

Annex: Sustainable Sourcing

• Sustainable sourcing is becoming a key strategy for companies aiming to align with ethical and environmental standards.
• Direct sourcing and traceability are increasingly important for specialty coffee brands.
• The Coffee Barometer underscores the need for transparent value distribution and fair compensation for farmers to support sustainable production.