Consumption
According to the latest domestic consumption survey published by the Brazilian Coffee Industry Association (ABIC), the total domestic coffee consumption in Brazil for the 2010/11 coffee year is expected to reach 19.5 million bags (18.47 million bags of roasted/ground coffee and 1.03 million bags of instant coffee), an increase of 4% compared to the previous coffee year.
ABIC also reported that Brazil’s green coffee consumption for the 2009/10 coffee year reached 18.75 million bags, up by 4% compared to the previous year (18.03 million bags). The consumption of roasted and ground coffee reached 17.73 million bags, while instant coffee was at only 1.02 million bags. These figures reflect the growth of Brazil’s population, per capita consumption, increased purchasing power, and the positive results of the national coffee consumption campaign.
ABIC mentioned that from November 2008 to October 2009, the coffee industry processed 18.39 million bags of green coffee, a 4% increase compared to the previous year (17.66 million bags). The average per capita consumption in 2009 was about 4.65 kg of roasted coffee per person, a 3% increase from the previous year, equivalent to coffee consumption in Germany. This shows that domestic coffee consumption in Brazil was not significantly affected by the global financial crisis at the end of 2008 and throughout 2009.
ABIC forecasts total domestic consumption for 2010 to reach 19.31 million bags, a 5% increase from 2009. The average retail coffee price in December 2009 was 10.49 reais/kg, up by 2.8% from the beginning of the year (10.20 reais/kg in January 2009). Total sales for 2009 were estimated at 6.8 million reais, and 7.1 million reais for 2010.
According to ABIC, if the domestic market continues to grow steadily, Brazil will meet its 2004 target of 21 million bags by 2012.
ABIC noted that the stable growth in consumption is due to several factors, including:
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Improvement in product quality through the creation of the “Pure Coffee Brand” in 1989 to recognize the quality of domestically processed coffee, and the 2004 Coffee Quality Program (PQC), which introduced “Quality Labels” for specific brands of domestic coffee and disclosed the type of coffee bean and flavor profile.
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Steady growth of the gourmet coffee market, which is attracting younger consumers. Although gourmet coffee still accounts for only about 3% of total domestic consumption, it is growing at a rate of 15% per year.
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The Coffee and Health Program has raised awareness that coffee can lead to a healthier lifestyle.
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Strong economic growth in Brazil, including higher per capita income, increased purchasing power, lower unemployment rates, and consumers shifting from low to high-income brackets, which have also contributed to increased domestic coffee consumption.
Trade
Exports
The São Paulo Agriculture Chamber of Commerce (ATO) forecasts that Brazil’s coffee exports for the 2010/11 coffee year will reach 32 million bags, an increase of 2.92 million bags compared to the previous year. The export of raw coffee beans is expected to reach 28.6 million bags, while instant coffee exports are projected to reach 3.3 million bags.
For the 2009/10 coffee year, coffee exports totaled 29.08 million bags, down 8% from the previous year. Specifically, exports of raw Arabica and Robusta coffee beans are expected to reach 26 million bags, while instant coffee exports were just 3 million bags. Brazil currently accounts for over 30% of global coffee exports. The reduced supply capacity of other coffee-producing countries has increased demand for Brazilian products, even during the off-season (April-March 2010). Additionally, Brazil has maintained a competitive position in the international market despite higher production costs and the depreciation of the U.S. dollar against the Brazilian Real.
The table below shows Brazil’s export of raw coffee beans (NCM 0901.11.10), instant coffee (NCM 2101/11/10), and roasted coffee (NCM 0901.21.00) to importing countries, according to SECEX, for the 2009 calendar year and the 2008/09 and 2009/10 coffee years (July-March).