Annual coffee production numbers indicate supply shortfall: ICO

With the crop year practically over in almost all coffee exporting countries, the International Coffee Organisation estimates that world production for the 2010/2011 coffee crop will be around 133.3 million bags, 1.5 million bags under expected consumption for the calendar year 2010.  In a report released in early September, the ICO reported that world consumption is estimated at 134.8 million for the calendar year 2010. With this figure falling under the predicted production numbers, the report noted that “the supply/demand balance continues to be fragile”.  Consumption reportedly increased by 2.1 per cent year-on-year, with domestic consumption in producing countries representing almost a third of world consumption. Demand in these exporting countries has risen by 56.6 per cent since 2000, to 41.3 million bags in 2010 compared to 26.4 million bags in 2000. Consumption in emerging markets increased by 33.3 per cent since 2000, while total consumption in traditional markets increased by just 15 per cent, according to the ICO report.  “It is worth highlighting the very important role of world consumption in achieving a balanced market and maintaining relatively firm price levels,” the report concluded. “Sustainable development of the coffee economy should be based on activities that promote a balance between supply and demand.”