Recently Published: A Business Case to Increase Specialty Coffee Consumption in Producing Countries
Photo: Almanegra Café, Mexico.
Over the past 10 years, specialty coffee consumption in producing countries—which has typically occurred at a lower rate than in traditional consuming markets—has increased.
In a new report supported in part by the Specialty Coffee Association, Hivos SAFE Platform, and IDB Lab, development economist and SCA Board Member VERA ESPÍNDOLA RAFAEL explores recent trends in the specialty consumption of Brazil, Colombia, Mexico, and Rwanda to establish a general understanding of domestic consumption in coffee-producing countries and reveal the potential impact increased domestic specialty coffee consumption has on producers.
The paper begins by exploring how value is created in specialty quality, tracing from cup quality of the product itself, green coffee evaluation, and grade determination, but also through establishing the identity and uniqueness of the product. This can come from the variety, terroir, processing, and milling. And more recently, Vera points to the experience created by shops and cafes as becoming more and more a part of how coffee is valued, beyond just “owning” or consuming it. All of these factors relate to each other and are interdependent, which Vera names “relational value.”
So what does this mean for producers? According to Vera, “When producers understand the value proposition of their coffee within value chains, they can focus on contributing to that proposition, leading to a potential increase both in the end-consumers’ willingness to pay and improve their retention of coffee’s economic value.
Coffee consumption is on the rise in all of these countries, driven largely by soluble and capsules/pods, though consumption of roasted and ground coffee are also on the rise. Another part of this trend can be seen in the arrival of international coffee chains. Today, an increasing number of independent coffee shops can also be found in these countries, not limited to urban areas. What we can see from this is that in all three countries, more consumers are demanding quality coffee, especially with the rise of manually brewed coffees.
There are advantages to increasing consumption in producing countries—namely that the supply chain is shorter, with opportunities for greater transparency and long-term relationships. There is also room for “differentiation,” where a country consumes different coffees from lesser-known regions, varieties, or processes, some of which are rarely served outside the country. Producers interviewed for this paper specifically said that they would like to improve post-harvest equipment and the availability of mills, and almost all requested greater availability of processing and marketing information in their own language.
“We need the right words, right environment to guide consumers to drinking better quality coffee,” said interviewee Isabela Raposeiras, owner of specialty coffee shop and roastery Coffee Lab in Sao Paolo, Brazil.
When the supply chain is more direct and transparent, as it is in consumption in producing countries, actors at both ends have the opportunity to benefit from the shared knowledge.
Increasing the domestic consumption of specialty coffee in producing countries is an opportunity to create additional value that strengthens the coffee market and gives more of that value to producers in an impactful way.
VERA ESPÍNDOLA RAFAEL is a Development Economist and Founder of CHIHUA Consulting focused on sustainable and inclusive interventions that benefit all actors within the coffee and cocoa chain.
Learn more about the preliminary results of the report in 25, Issue 10 or watch Vera’s presentation on the study at the 2019 Re:co Symposium.
