International Production and Coffee Trade
Coffee is one of the most valued and traded agricultural products in the world, both as a premium high-end niche product and as a standard quality common staple. In order to produce coffee, the beans need to be grown, picked, roasted, and eventually ground. Coffea arabica, as the coffee plant is scientifically called, is originally native to the Indian Ocean region, particularly Africa and the tropical region of Asia. However, after becoming a widely popular drink, European travelers and explorers spread coffee plantations throughout tropical and sub-tropical regions worldwide. Today, the global trade of coffee, in all of its forms, including green, roasted, and decaffeinated, amongst others, represents a multibillion-dollar business. During 2016, coffee exports totaled some US$24 billion worldwide, while coffee imports accounted for US$28.4 billion.
It is important to note that European countries are amongst the chief exporters of coffee even though coffee is not widely grown in Europe. This is mainly due to the fact that western European countries import large amounts of green and unprocessed coffee beans as commodities, which they then process and package nationally for value-added sales. A similar dynamic to that which occurs with other agricultural products, such as chocolate.
International Production and Coffee Trade
During 2016, the world’s largest exporter of coffee was Brazil with 20% or US$4.8 billion of global exports, followed by Colombia with 10% or US$2.5 billion. Nevertheless, in 2016, the continent with most coffee exports was Europe totaling 43% of global exports, whereas South America accounted for 34%. Within Europe, the largest exporters of coffee were Germany representing 9.7% or US$2.3 billion of global exports as well as Switzerland with 8.6% or US$2.1 billion. In terms of imports, Europe and North America dominate the international coffee consumption market. During 2016, Europe imported 58% of all coffee sold internationally, while North America imported 25%. However, at a national level, the largest importer of coffee in 2016 was the United States, totaling 20% or US$5.8 billion of global imports. Meanwhile, that same year, Germany was the second with 12% or US$3.4 billion of all international imports.
A close competitor to the global coffee market is hot tea, in its black, grey, and green varieties. During 2016, global tea exports totaled US$5.3 billion and tea imports accounted for US$5 billion. Nevertheless, unlike the global coffee market, tea exports are dominated by Asia, which represented a staggering 73% of all exports in 2016. Last year, China was the most important tea exporter in the world with 28% or US$1.5 billion worth of exports, followed by Sri Lanka totaling 24% or US$1.2 billion in exports. Simultaneously, the world’s largest importers of tea were Russia with 11% or US$548 million; Pakistan with 9.8% or US$490 million; and the United States with 9.5% or US$473 million of all tea imports.
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