Market Reports

Former SCA Executive Director Ric Rhinehart prepares for change in 2019

First and foremost I believe that 2019 will be a year in which change is the central issue across many fronts. In coffee, continued consolidation of both production and consumption will force changes that many have anticipated, some have acknowledged, and few have prepared for. I anticipate exceptionally high volumes of coffee production from the top producing countries will bring home the terrible realities of this scenario. Coffee prices are likely to dip even lower as leading producers harvest record crops, and many smaller traditional origins will be devastated by yet another year of prices well below the cost of production. The social and economic toll will be extreme, and the coffee world is ill prepared for this scenario. The need for collaborative solutions is urgent and we must commit to advancing the basic economic viability of coffee farming. Similarly, dramatic consolidation on the consuming side will leave a scenario where very large roasters compete on low price and significant marketing investment, leaving quality aside and further polarising the market for coffee. Here, there is a real opportunity for quality-driven specialty players to make a difference for both coffee drinkers and coffee growers. In another inevitable change, generational transition will continue as the post-WWII boomer generation in the developed world continues to leave the stage. The digitally driven newcomers of the millennial and Z generations will drive more disruption, less tradition, and a new mindset around the role of commerce in the world. Constantly increasing access to information, better and better data collection, and a rapidly accelerating communication capability will all be more fully realised this year than ever before, and will drive profound change. Leaders retiring and emerging should commit to shepherding change while remembering our history. Finally, the inexorable impact of anthropogenic climate change will manifest itself in ways that are dramatically more obvious and intense, not only in our coffee world but in every aspect of life on the planet. What was an inconvenient truth just a dozen years ago will be a painful and inescapable reality for many this year. Our most important work together will be in finding ways to mitigate and adapt to a changing climate reality.

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