Why is Colombian coffee so celebrated, and why has Colombia been able to produce large amounts of good quality coffee? When I was a teenager, I thought that all coffee came from Colombia. In my defense, there was a reason for that. At that time in the United States, way back in the s, Colombia was the only coffee-producing country that we ever heard of. I now know that coffee is grown in more than just one country.
But the fact sticks: Colombian coffee is more famous than most other producing countries. Even countries with longer producing histories or higher production enjoy less renown. History hints at coffee arriving by the early s, cultivated first by Jesuit priests in the east. Plantations were mostly in the hands of large landowners. Prices plummeted in the early s. This NGO increased coffee production and small shareholders by buying large coffee plantations, dividing them, and selling them to individual workers.
They researched and created disease-resistant varieties such as Colombia and Castillo. Juan Valdez was born. He was part of a massive marketing campaign to promote this single-origin product and represent Colombian coffee around the world. Consumption boomed in the US, and prices increased. This prompted growers to plant disease-resistant varieties.
Colombia has more than , coffee growers and a yearly coffee production of 14, metric tons. Whether that coffee-as-redemption legend is true or not, coffee cultivation has been relatively high. It even gets a premium on the stock market because of its higher quality.
Why does coffee from Colombia have that reputation? All coffee grown in Colombia for export is Arabica. Arabica coffee beans are well known for generally producing higher quality coffee. What are the most common varieties of Arabica in Colombia? Older farms will often have Typica. Geography plays a huge role in coffee quality. The Andes Mountains cross the country in three parallel mountain ranges, resulting in various altitude zones that provide plenty of terrain for coffee cultivation.
Many of those mountains are volcanoes that contribute to creating mineral-rich soil where coffee plants flourish. All that plant diversity makes the soil ideal for growing coffee. Since coffee is grown from far north to far south, there are many climates and microclimates. These conditions guarantee that there are harvests throughout the year, unlike other producing nations that have just one harvest season.
Additionally, some microclimates produce two harvests. As I mentioned, coffee in Colombia is cultivated in the mountains. Strip picking is more common to harvest Robusta coffee. The Colombian government launched its landmark price stabilization fund in March Price recovery took hold from the middle of onwards as the internal buy rate moved above the estimated cost of production.
Aside from the drop in the value of the peso against the dollar, a number of other factors had an inflationary impact on prices in This included lower yields in neighboring Brazil due to inclement weather and a reduction in export volumes across Central America, which created a supply squeeze across the region. Now, as the industry is approaching the peak of the smaller mid-season harvest known as the traviesa , the FNC internal buy rate has been rallying once again.
With road transportation having been paralyzed across parts of the country, suppliers have been concerned about being able to fulfill orders, meaning ever higher-prices are chasing a diminishing supply of coffee. Many highways also remained blocked, meaning coffee destined for export remains stranded.
Therefore, the short- to medium-term outlook remains uncertain. If this happens, prices may continue to climb, with the next psychological barrier of COP 1,, very much in sight. Looking beyond the impact of the protests, producers have enjoyed an unexpected windfall since the beginning of last year thanks to continued high prices. However, there is some concern that complacency could set in if the longer internal buy rates remain high.
For one thing, abnormally high prices may disincentivize some producers from switching to higher-value specialty crops — a stated development objective of the FNC. Switching from commercial to specialty grade coffee can give producers more economically sustainable footing in the long-term, though there are risks involved. Meanwhile, the FNC is paying producers record prices for commercial-grade crops. It is impossible to predict the future direction of prices.
Yet as recent history has shown, prices can go down and stay down for prolonged periods of time. With the impacts of climate change and COVID also added into the equation, we might reasonably expect continued market volatility. Unfortunately, producers still confront a host of barriers to their economic security, which means they have very little to fall back on should the market experience a sudden fall in prices.
Within a matter of years, there was tangible proof that the campaign had worked. At the same time, the campaign contributed to Colombian coffee maintaining a relatively higher price than coffees from other origins.
Luis also notes that when the ICO imposed export quotas in , the only way to maximise income when volumes were restricted was to increase premiums.
As such, the FNC tried to use the campaign to maximise demand for Colombian coffee so that the premiums would increase. This is because the campaign was focused on markets in the United States, Europe, and parts of Asia, as buyers were willing to pay a higher price for their coffee.
Eduardo says that specialist media and international television channels were used to spread the message. He explains that the campaign was not historically successful in Colombia, as there was traditionally a big gap between what the country produced and what was consumed. Therefore, what was left in the country was all inferior byproducts. A FNC document claimed that some producing countries considered the idea of designing their own campaigns.
However, this idea never materialised. Eduardo, meanwhile, explains that such a large-scale strategy required an enormous investment that only Colombia and Brazil could afford at the time. For others, it was simply too expensive.
These are things that were achieved almost exclusively during the emergence of the Colombian coffee business, which had extraordinary margins. Today, it would be difficult to do so. In addition, Luis tells me that nowadays, consumers are better informed and need different and more complex channels of communication for something so comprehensive.
A generic TV commercial is simply not enough.
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