Cup of Coffee, Please

Legend has it that a 19th century French politician once said: “Coffee should be hot as hell, black as the night — and sweet as love.” Matters of taste aside, coffee is a serious business. To many, this commodity represents the process of globalization in all its aspects — good and bad. Enough reason for a new Globalist Factsheet to look at how global the coffee business has really become.

Who is the world’s biggest coffee producer?

At 1.8 million tons per year, Brazil is the top producer of coffee in the world, followed by 672,600 tons from Vietnam. Colombia produces 630,000 tons and Indonesia 432,000 tons.

(Worldwatch Institute)

Who first brought coffee beans to Latin America?

Coffee was brought to Colombia by Jesuit priests around 1700.

(Washington Post)

How much does coffee cost?

Back in 1976, 100 pounds of Nicaraguan coffee sold for $350. In 1999, the price had fallen to $160. As of 2003, prices hover around $50 — a 70% drop since 1976.

(Washington Post)

Who makes the biggest profits?

As of 2003, Starbucks charges between $9.95 and $15.45 for a pound of coffee in its stores. Meanwhile, coffee farmers receive less than $0.50 per pound.

(New York Times)

Did the introduction of fair trade coffee change anything?

As of 2003, certified organic fair trade and other certified coffees make up less than 1% of a world coffee market that consists of 100 million bags annually.

(Financial Times)

How dependent are coffee-producing countries on the beans?

As of 2003, coffee generates around 10% of Colombia’s legal export income. Back in the 1960s, it accounted for more than 50%.

(Washington Post)

How about other countries?

As of 2003, coffee accounts for more than one-third of Nicaragua’s foreign income.

(Washington Post)

What made the situation worse?

Until 1989, the International Coffee Agreement helped support the economies of developing countries. After the end of the Cold War, the United States pulled out of the agreement.

(New York Times)

How does the U.S. craving for coffee help?

As of 2003, about $18 billion worth of coffee is consumed annually in the United States.

(New York Times)

What does that mean on an individual level?

As of 2003, Americans drink about 20% of the world’s coffee — with per capita consumption reaching 370 cups a year.

(Worldwatch Institute)

How does this consumption level compare to other countries?

As of 2003, each Japanese on average consumes about 3 kilograms of coffee beans annually, compared with 4.24 kilograms in the United States.

(New York Times)

Has that influenced Starbucks’ business plans?

As of 2003, Starbucks Coffee has opened 467 stores in Japan, after opening its first one only in 1996 — and never running any advertisements.

(New York Times)

How about the European market?

In March 2001, Starbucks opened its first European coffee shop in Zurich.

(Economist)

How did Starbucks’ business develop over the years?

Back in 1989, Starbucks had 50 coffee bars. As of 2003, there are more than 5,000 coffee shops worldwide — even around ten in Beijing.

(Economist)

How does that break down in terms of customers and turnover?

As of 2003, Starbucks has an annual turnover of $3.3 billion — and over 5 million customers around the world each week.

(The World Almanac and Book of Facts)

And finally, is the revolutionary spirit of the old coffee houses still alive?

In Tehran, Internet cafes — or Coffeenets — were opening at a rate of about one a day in 2001, with an estimated 450 operating.

(Washington Post)