(organic) coffee, tea and cocoa market in the eu

Transcription

CBI MARKET SURVEY:
THE (ORGANIC) COFFEE, TEA AND COCOA MARKET IN THE EU
CBI MARKET SURVEY
THE (ORGANIC) COFFEE, TEA
AND COCOA MARKET IN THE EU
Publication date: May 2008
CONTENTS
REPORT SUMMARY .................................................................................................. 2
INTRODUCTION....................................................................................................... 4
1
CONSUMPTION ................................................................................................. 5
2
PRODUCTION ................................................................................................. 19
3
TRADE STRUCTURE ......................................................................................... 21
4
TRADE: IMPORTS AND EXPORTS..................................................................... 34
5
PRICE DEVELOPMENTS ................................................................................... 48
6
MARKET ACCESS REQUIREMENTS ................................................................... 54
7
OPPORTUNITIES AND THREATS ..................................................................... 56
APPENDIX A
PRODUCT CHARACTERISTICS ........................................................ 57
APPENDIX B
INTRODUCTION TO THE EU MARKET .............................................. 60
APPENDIX C
LISTS OF DEVELOPING COUNTRIES ............................................... 61
APPENDIX D
REFERENCES .................................................................................. 63
This survey was compiled for CBI by ProFound – Advisers In Development
in collaboration with Mr. Joost Pierrot
Disclaimer CBI market information tools: http://www.cbi.eu/disclaimer
Source: CBI Market Information Database • URL: www.cbi.eu • Contact: [email protected] • www.cbi.eu/disclaimer
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REPORT SUMMARY
This CBI market survey profiles the (organic) coffee, tea and cocoa market in the EU. The
(organic) coffee, tea and cocoa markets in individual EU countries are discussed in separate
market surveys. These market surveys as well as EU export marketing guidelines for (organic)
coffee, tea and cocoa can be downloaded from http://www.cbi.eu/marketinfo.
Consumption and trends
In 2006, total EU coffee consumption amounted to 2.5 million tonnes, representing an average
EU per capita consumption of 5.0 kg. This indicated a small annual increase between 2002 and
2006. Germany, Italy and France are the main consuming countries, accounting for almost
50% of EU consumption. Taking the organic and Fair-trade coffee markets together, they
would account for more than 2% of the total coffee market.
In 2006, the EU consumed 243.3 thousand tonnes of tea, of which 135.4 thousand tonnes was
consumed in the United Kingdom (International Tea Committee, 2008). Other leading EU
markets for tea are Poland, Germany, France, Ireland and The Netherlands. In terms of per
capita consumption, tea is most popular in Ireland and the United Kingdom. In general, tea
consumption in the EU shows a slight decrease, although green tea consumption is increasing.
While consumption in traditional tea-drinking countries is decreasing, consumption in other
countries such as Italy, Hungary and the Czech Republic is increasing fast. The leading EU
markets for organic tea are the United Kingdom and Germany.
In order to assess the demand for cocoa beans, total grindings per country are an important
determinant. Almost 40% of global cocoa bean supplies are ground in the European Union,
amounting to a volume of 1.44 million tonnes in the cocoa year 2007/08, increasing by 4.2%
per year. The most important cocoa grinding EU member countries are The Netherlands and
Germany. Other countries with considerable cocoa grinding facilities are France and the United
Kingdom.
In 2005/2006 consumption in the EU amounted to 1.4 million tonnes, an increase of 3.0%
annually since 2001/2002. The largest consumers are Germany, France and the UK.
Chocolate confectionery is very popular in Belgium, Germany, Ireland, the United Kingdom and
Austria, all having a per capita consumption of 8 kg or higher in 2005. In the same year, total
consumption amounted to 2.4 million tonnes and it is expected that this will continue to
increase. Organic cocoa products still account for a small share of the total market, but this
share is increasing rapidly.
Important trends influencing the EU market for coffee, tea and cocoa are:
• The trend towards convenience and smaller portions has led to an increasing demand for
products like instant coffee, coffee and tea pods, chocolate bars, tea-for-one bags, iced tea
and coffee, etcetera.
• An increasing awareness of the environmental and social aspects of production led to
greater importance of ‘sustainable’ coffee, tea or cocoa, including organic, Fair trade, Utz
Certified, and other certification schemes. A “Common Code for the Coffee Community”
(4C) and a ‘Sustainable Coffee Initiative’ have also received support.
• In line with the trend towards organic certification, is the trend among EU consumers
towards a healthy life-style and, consequently, increased consumption of health food.
• Moreover, European consumers are calling for more variety and specialties. Single origin
products are an important component of this trend.
Production
Because of climatic conditions, no production of coffee, tea and cocoa beans takes place within
the EU. However, coffee and tea are processed in the EU. The processing companies buy the
raw material from developing country producers and do not compete directly with developing
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countries on the market. Actually, developing countries play no relevant role in the EU market
for roasted coffee and tea blends.
The EU is a major grinder of cocoa beans imported from developing countries, and is therefore
a competitor to developing countries on the markets for processed cocoa products. The
Netherlands is the leading grinder and is also the world’s leading producer of processed cocoa
products. Germany, France and the UK also have large production facilities.
Trade structure
In general, traders are the most important trade channel for all three products for developing
country producers, but in certain cases local agents of EU buyers, or EU processors, can also
be an interesting channel. Regarding organic products, the main organic traders mostly located
in Germany and The Netherlands, are probably the most important trade channel.
Imports
Between 2002 and 2006, imports of coffee increased by 14% annually in value, and by 3% in
volume, amounting to € 6.3 billion / 3.3 million tonnes in 2005. Germany is the leading EU
importer, followed by France, Italy and Belgium.
Imports mostly come directly from developing countries, the most important suppliers being
Brazil and Vietnam, with direct imports accounting for 67% of total imports in value and 80%
in volume. Organic coffee is mostly sourced in Latin America. Roasted coffee is supplied by
European countries.
Imports of tea into the EU decreased each year between 2002 and 2006. Between 2004 and
2006, however, imports rebounded somewhat, amounting to € 801 million / 336 thousand
tonnes. Except for The Netherlands, imports by the main consuming countries in the EU
decreased. However, imports by Eastern, Southern and Central European countries are
showing a much better development.
More than 60% of EU tea imports is sourced directly in developing countries, while the
remainder consists of re-exports by other EU member countries. While imports of black tea
showed a small decrease, imports of green tea are increasing.
Both in terms of value and in volume, the EU imports of cocoa beans, cocoa paste and cocoa
powder decreased between 2002 and 2006, especially for cocoa powder, amounting to € 2.1
billion, € 565 million and € 294 million respectively in the latter year. Imports of cocoa butter
increased, amounting to € 1.3 billion. The Netherlands, Germany, Belgium and France are the
leading importers of cocoa beans and derivate products.
Almost 90% of the imports of cocoa beans originate directly in developing countries. The role
of developing countries for paste and butter is also large. However, powder imports come
mostly, and increasingly, from EU countries.
Prices
Prices for coffee, tea and cocoa are world market prices, either determined in futures markets
(coffee and cocoa) or auctions (tea). Prices for coffee have shown a very favourable
development in the last couple of months, and in general since 2004. Only recently have prices
started to increase somewhat for tea. Prices for cocoa beans increased fast in the second half
of 2006, and although they are now again increasing, still lie quite a bit under the record prices
in mid-2007.
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INTRODUCTION
This CBI market survey profiles the coffee, tea and cocoa market in the EU. The emphasis of
this survey lies on those products, which are of importance to developing country suppliers.
The role of and opportunities for developing countries are highlighted.
This market survey discusses the following product groups:
• Coffee (Arabica and Robusta varieties)
o Green coffee
o Roasted coffee
• Tea
o Black tea (including Oolong tea)
o Green tea (including White tea)
• Cocoa
o Cocoa beans
o Cocoa paste
o Cocoa butter
o Cocoa powder
For detailed information on the selected product groups, please consult appendix A. More
information about the EU can be found in appendix B.
CBI market surveys covering the market in specific EU member states, specific
product(group)s or documents on market access requirements can be downloaded from the
CBI website. For information on how to make optimal use of the CBI market surveys and other
CBI market information, please consult ‘From survey to success - export guidelines’. All
information can be downloaded from http://www.cbi.eu/marketinfo Go to ‘Search CBI
database’ and select your market sector and the EU.
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1
CONSUMPTION
1.1
Market size
This Chapter discusses the consumption of coffee, tea and cocoa. Two remarks need to be
made to clarify the set-up of this chapter. Firstly, the focus will be specifically on the markets
for sustainable coffee, tea and cocoa, because organic, Fair Trade, and certification schemes
offer exporters in developing countries good opportunities. These markets grow faster, offer a
premium, and traded volumes are smaller than in the conventional market. Secondly, whereas
coffee and tea consumption are referred to as consumption, for cocoa this is referred to as
industrial demand. Coffee and tea processors directly produce consumer products, while cocoa
grinders produce ingredients. These are used by industrial users such as chocolate
manufactures and food processors. This means that, for coffee and tea, data on final
consumption by EU citizens is directly available, while data on processing is not. In contrast,
consumption of cocoa is unknown, due to the fact that cocoa products are processed in a large
range of products. However, EU grindings, combined with the imports of processed cocoa
products, offer an indication of industrial demand.
Coffee
Table 1.1 EU consumption of coffee, 2002-2006, total in 1,000 tons, per capita in
kg per annum, average annual change in % of total coffee consumption
2002
2004
2006
Average
annual
per
per
per
total
total
total
capita
capita
capita change
Total EU
2,317.0
4.8 2,463.8
5.0
2,459.6
5.0
1.5%
Germany
510.0
6.2
626.7
7.6
549.1
6.6
1.9%
Italy
310.9
5.4
328.1
5.6
335.6
5.7
1.9%
France
331.6
5.5
296.0
4.9
316.4
5.2
-1.2%
United Kingdom
135.6
2.3
147.5
2.5
183.4
3.0
7.8%
Spain
170.0
4.1
162.3
3.8
181.0
4.1
1.6%
The Netherlands
94.4
5.9
118.7
7.3
127.7
7.8
7.8%
Poland
132.6
3.4
136.9
3.5
117.2
3.1
-3.0%
Belgium
89.0
8.7
76.9
7.4
92.2
8.8
0.9%
Sweden
73.4
8.2
74.0
8.2
78.9
8.7
1.8%
Finland
58.2
11.2
62.0
11.9
62.8
11.9
1.9%
Greece *
49.2
4.5
52.1
4.7
51.4
4.6
1.1%
Romania *
44.1
2.0
49.1
2.3
50.4
2.3
3.4%
Denmark *
48.3
9.0
50.9
9.4
49.9
9.2
0.8%
Portugal *
43.1
4.2
40.9
3.9
44.8
4.2
1.0%
Czech Republic *
38.6
3.8
37.0
3.6
36.7
3.6
-1.3%
Austria *
54.8
6.8
58.9
7.2
36.5
4.4
-9.7%
Hungary *
38.3
3.8
42.5
4.2
35.9
3.6
-1.6%
Bulgaria *
20.4
2.6
21.9
2.8
25.3
3.3
5.5%
Slovakia *
18.1
3.4
16.9
3.2
16.9
3.1
-1.7%
Lithuania *
12.5
3.6
11.9
3.4
12.8
3.8
0.6%
Ireland *
8.1
2.1
13.3
3.3
12.1
2.9
10.6%
Latvia *
8.7
3.7
9.3
4.0
10.9
4.7
5.8%
Slovenia *
11.3
5.7
11.1
5.6
10.6
5.3
-1.6%
Estonia *
6.7
4.9
7.7
5.7
10.1
7.5
10.8%
Luxembourg *
5.9
13.2
7.1
15.7
6.3
13.5
1.7%
Cyprus *
2.7
3.8
3.2
4.3
3.0
3.9
2.7%
Malta *
0.5
1.4
0.9
2.3
1.7
4.3
35.8%
* Based on calculations using Eurostat population figures and ICO per capita consumption figures.
Source: ICO Coffee Market Reports November 2007
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Coffee is mainly consumed in the developed countries of the northern hemisphere, and much
less in the producing countries in the South. Between 2002 and 2006, the EU coffee
consumption increased by an average annual rate of 1%, peeking in 2004. In 2005, however,
consumption dropped by 6%, and in 2006 the consumption level was still somewhat below the
2004 level. In 2006, total consumption amounted to 2.5 million tonnes or 5.0 kilos per capita.
The EU accounts for a third of world coffee consumption, which is twice as large as the
consumption in the United States.
After a period of decreasing consumption, consumption in Germany and France picked up in
2006. However, even with this growth for Germany, the record year 2004 was not equalled.
Italy showed a more stable increase. Together, these three major markets accounted for
almost 50% of total EU consumption in 2006. Other important EU coffee consuming countries
are the UK (7%), Spain (7%), The Netherlands (5%) and Poland (5%). Of these countries, the
United Kingdom and The Netherlands showed the largest average annual growth rates during
the review period. Consumption decreased in France and Poland.
According to ICO, coffee consumption is traditionally higher in Nordic countries, especially
Finland, with per capita consumption amounting to 11.9 kg per capita in 2006. Other EU
member countries with high per capita consumption are Luxemburg (13.5 kg) and Belgium
(8.8 kg). Coffee consumption is rapidly increasing in Ireland and the UK, traditionally teaconsuming countries.
Within the EU, the most important forms in which coffee is consumed are:
• Ground coffee - this coffee, used for filter coffee systems, or in coffee pods, is still the
principal type of coffee consumed in the EU.
• Roasted coffee beans – With the increasing prevalence of espresso and cappuccino systems
sold for use in the household, direct sales of roasted coffee beans is increasing fast. The
increasing number of coffee bars is also strengthening this trend.
• Decaffeinated coffee – the International Tea Committee (ITC) estimated that decaffeinated
coffee accounts for around 10% of all coffee sales (ITC, 2002). Decaffeinated coffee is
losing share, as caffeine no longer appears to be an issue of particular concern to most
consumers. However, in some South European countries decaffeinated is still an ongoing
trend. Moreover, with production predominately taking place in the EU, this is of limited
interest to developing country producers.
• Soluble or instant coffee – The share of soluble coffee in the total coffee consumption
varies considerably among EU member countries; in Germany, soluble coffee comprises
only 8% of total coffee consumption, whereas in the United Kingdom and Ireland, both
typically tea-consuming nations, this share amounts to about 75%, although as coffee
consumption is becoming more sophisticated, this is decreasing. Among developing
countries, it is mostly Brazil that plays a role supplying this segment, with actual
production predominately taking place in Europe.
• Ready-to-drink coffee – Less important than in the US market, but upcoming in the EU
along with the trend towards convenience food product, are ready-to-use coffee drinks like
iced coffee. These are mostly produced in the EU. This is also of importance in the catering
sector.
• Flavoured coffee – An interesting and fast growing area of the market is flavoured coffees.
Organic and other certified coffees
Within the coffee market, sustainable coffee is an increasingly important segment of the
market, especially as certifications, next to organic and Fair-trade, are supported by major
European supermarkets and roasters. A curious phenomenon in much of northern Europe is
that consumption of organic coffee has not responded very much to falling premiums of
organic coffee. More attention must be paid to branding and promotion, in addition to quality
to be able to increase this market share. ITC estimated total world consumption of coffee at
around 57,000 tonnes in 2006, of which over 40% or 24,000 tonnes in the EU. For 2007, ITC
expects that total consumption will have increased by around 10% worldwide. The strongest
growth is expected for France and the UK.
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Within the sustainable coffee market, organic certification takes a subordinate position
compared to Fair-trade certified and especially Utz Certified coffee (former Utz Kapeh). Fair
trade was until recently, the volume leader among certified coffees in Europe. As can be seen
in Table 1.2, consumption of Fair-trade certified coffee increased by 30% annually between
2002 and 2006, amounting to 26,000 tonnes.
Table 1.2
Consumption of Fair-trade certified coffee in selected EU countries
2002-2006, in tonnes
2002
2004
Austria
409
519
Belgium
632
865
Canada
425
826
Denmark
655
550
Finland
109
120
France
1,386
2,784
Germany
2,942
2,981
United Kingdom
1,954
3,339
Ireland
60
126
Italy
243
225
Luxemburg
68
70
The Netherlands
3,140
2,982
Sweden
289
375
Spain
n.a.
n.a.
TOTAL*
9,172 15,762
Source: FLO International 2007
2006 Average annual change
747
16%
1,047
13%
2,268
52%
733
3%
284
27%
6,175
45%
3,908
7%
6,238
34%
304
50%
260
2%
91
8%
2,845
-2%
953
35%
193
n.a.
26,046
30%
Utz Certified recently took over the lead among sustainable coffees. Between 2006 and 2007,
sales of Utz Certified certified coffee increased from 36,000 tonnes to more than 50,000
tonnes, still for the larger part in Europe, an increase of almost 40% (Utz Certified website
2007). Starting as an initiative of Ahold Coffee in 2003, it was quickly followed by other
retailers. For example, McDonalds announced it would feature certified sustainable coffee in
Western Europe, mainly based on the Utz Certified scheme. Especially in The Netherlands, Utz
Certified plays an important role, with a market share of 25% in 2006. In Belgium, its share
was 5% in the same year. No further country specific data is available for Utz Certified.
Shade-grown and bird-friendly certifications have just begun to reach Europe, but might also
profit from the McDonalds scheme, with its sustainable coffee scheme also based on birdfriendly certification in several countries. No figures are available for these markets.
For other certification schemes, such as the Common Code for the Coffee Community (4C)
(http://www.sustainable-coffee.net), no market information is available. The initiative is
broadly accepted by supporters both in producing and consuming countries. Within the EU, it
concerns traders such as Armajaro and Ecom, large roasters such as Nestlé, Kraft and Sara
Lee and retailers such as COOP. As such, it can be expected that its impact will be quite
significant. 4C aims at achieving sustainability in the coffee chain through continuous
improvements of the social, environmental and economic practices of the production,
processing and trading of mainstream coffee. Through a third-party verification scheme, it
aims at excluding the use of “Unacceptable Practices” and at supporting continuous
improvement towards sustainable practices in the mainstream coffee sector.
Responding to concerns about global warming, Impatto Zero is an Italian certification scheme
based on the Kyoto protocol for the compensation on CO2 emissions
(http://www.impattozero.it). Impatto Zero quantifies the environmental impact of companies,
products and persons by calculating the emission of carbon dioxide and compensating them
with the creation and protection of forests in Italy and around the world. The market impact of
this and other CO2 schemes is not known.
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Taking the organic and Fair-trade coffee markets together, they would account for more than
50,000 tonnes, or 2.0% of the total coffee market. This figure would increase considerably
with the inclusion of Utz Certified. However, as Utz Certified does not specify its sales figure
per region, this is not possible. Germany, France and the United Kingdom are Europe's largest
markets for sustainable coffee, followed by The Netherlands and Belgium.
The relative weight of the different certification schemes can be very different, however. For
example, in Germany organic coffee is relatively important, while in the UK and France Fairtrade is the leading certification scheme. In The Netherlands, Utz Certified is the leading
certification scheme for coffee, because of the market position of Albert Heijn. The sustainable
market share is higher in Denmark, The Netherlands, Sweden and Germany. In the UK and
France the market has also quickly developed in recent years. The market share of sustainable
coffee is much smaller in South and East European countries. However, sustainable coffee has
recently become more widely available in Spain and Italy and future growth is expected there.
Increased quality and professionalism have earned both Fair-trade and organic coffees more
space in retail outlets.
Tea
The EU, with a total consumption of 243.4 thousand tonnes in 2006, accounts for 16.5% of
global tea consumption. In 2002, this share was 18.0%. The United Kingdom is one of the
world’s leading consumers of tea, with a total consumption amounting to 135.4 thousand
tonnes in 2006, accounting for more than half of total EU tea consumption. Other leading EU
markets for tea follow at a distance: Poland, accounting for 11% of total EU consumption in
2006, Germany (9%), France (6%), Ireland (4%) and The Netherlands (3%). In terms of per
capita consumption, tea is particularly popular in Ireland and the United Kingdom, where there
was a per capita consumption of 2.4 kg and 2.2 kg respectively in 2006.
Table 1.3 Tea imports for consumption in the EU, 2002-2006, in metric tonnes
Country
2002
2004
2006
Average % change
Total EU**
247,245
241,257
243,374
-0.4%
United Kingdom
136,598
128,755
135,403
-0.2%
Poland
31,000
32,114
27,144
-3.3%
Germany
22,297
21,764
21,298
-1.1%
France
13,611
13,053
13,431
-0.3%
Ireland
11,228
10,461
8,760
-6.0%
The Netherlands
6,924
7,700
8,000
3.7%
Italy
5,453
6,000
6,651
5.1%
Baltic States*
3,100
3,300
3,500
3.1%
Hungary
1,906
1,969
2,912
11.2%
Czech Republic
2,056
2,392
2,658
6.6%
Belgium & Luxemburg
2,100
2,100
2,200
1.2%
Sweden
2,779
2,850
2,060
-7.2%
Austria
1,765
1,626
1,695
-1.0%
Denmark
1,667
1,466
1,369
-4.8%
Spain
1,100
1,200
1,300
4.3%
Finland
833
1,000
1,077
6.6%
Greece
550
941
1,074
18.2%
Slovakia
750
850
900
4.7%
Portugal
480
626
782
13.0%
Malta
600
650
660
2.4%
Romania
160
170
190
4.4%
Cyprus
160
150
160
0.0%
Bulgaria
128
120
150
4.0%
* Baltic States: Estonia, Latvia and Lithuania
** Excluding Slovenia
Note: Imports adjusted for re-exports
Source: International Tea Committee's Annual Bulletin of Statistics 2007
Most of the leading EU countries mentioned saw their tea consumption decrease between 2002
and 2006, which is also reflected in the average EU decrease of 0.4% annually. Of these EU
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member countries, only The Netherlands (3.7% annually) witnessed increase in tea
consumption during the review period. Other less important EU tea markets where tea
consumption increased substantially are, in order of market volume, Hungary (11.2%), Greece
(18.2%) and Portugal (13%).
Within the EU, the teas consumed are:
• Green/Black tea: The tea market has seen a decline in sales of mainstream black tea bags.
Black tea accounts for about 72.5% of global production and around 90% of the market in
Western countries. However, as is also reflected in the increasing EU imports of green tea,
this product is increasingly gaining popularity in the West, partly due to health reasons.
• Flavoured tea – flavoured tea was introduced as a response to an increased demand for
variety in tea consumption. It includes fruit teas and perfumed teas (e.g. containing anise
or cinnamon flavour). These are predominately blended in the EU.
• Herbal tea – herbal drinks, particularly herbal teas and infusions, are becoming increasingly
popular in the EU. According to the Association of Dutch Coffee Roasters and Tea Packers
(VNKT), for example, in The Netherlands herbal infusions (e.g. rooibos) comprised 16.3%
of total tea consumption in 2006, increasing from 14.7% in 2005 (VNKT, 2007). Please
note that herbal teas are not included in the table below, as although they are consumed
as teas, they (often) do not contain tea.
• Ready-to-drink teas – iced tea was initially introduced in Belgium as a sports drink, but is
now a widely accepted drink in the EU. It is a particularly popular beverage in Germany
and Italy.
Organic tea
Very little information is available for organic tea and the sustainable tea market is much less
dynamic than that of the coffee. The leading EU markets for organic tea are the United
Kingdom and Germany. In other European countries, consumption of organic tea is far more
limited. According to industrial sources, the price of conventional tea is quite low in the EU and
final consumers are not willing to pay a high premium for organic tea.
In 2002, the market share of organic tea was estimated at 1%. Although it can be expected
that the market has increased further in the last couple of years - considering the increasing
attention for organic consumption across (Western) Europe, the increasing focus on
sustainability issues by consumers and increasing inclusion in main stream channels (which,
outside of the UK remain of limited importance compared to organic retailing) - the role of
organic tea remains nevertheless limited.
Flo-Certified Fair-trade tea is sold predominately in the UK. Of the 2,366 tonnes sold in the EU
(accounting for 90% of worldwide Fair-trade sales), sales in the United Kingdom amount to
1,850 tonnes. France and Germany follow at a far distance. This would also set the Fair-trade
market share at around 1%. However, especially in the UK, tea is often double-certified.
Cocoa
The buyers of cocoa beans in the consuming countries are traders, grinders and vertically
integrated chocolate manufacturers, as well as other food industries. A small number of
multinational companies dominates processing of cocoa beans and paste, the most important
of which are located in The Netherlands and Germany. Both countries also have several
important traders, but many are also located in the United Kingdom, Switzerland and France.
Total industrial demand for cocoa is impossible to determine, due to the fact that processed
cocoa products (butter, powder etc.) are used in broad industries and in an even broader
range of products. Therefore, to assess the demand for cocoa beans, total grindings per
country are an important determinant, as shown in Table 4.4.
The European Union takes a dominant position in world grindings. Almost 40% of the global
cocoa bean supplies are ground in the European Union, amounting to a volume of 1.44 million
tonnes in the cocoa year 2005/06. Grindings in cocoa importing countries are larger than in
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cocoa bean exporting counties and are increasing at a higher rate. During the review period,
EU grindings increased by 4.2% per year, demonstrating the positive development of cocoa
demand.
Table 1.4
Grindings of cocoa beans in the EU, 2003/04-2007/08, in 1,000 tonnes
2003/2004 2005/2006 2007/2008*
EU-total
Average annual % of EU
change
4.2%
1,227.1
1,317.2
1,444.0
445.0
224.5
150.2
130.0
67.2
66.0
50.0
21.1
10.2
10.3
26.7
3.5
0.2
2.0
4.5
0.1
0.2
0.7
14.7
455.0
306.5
155.2
137.8
75.7
61.8
50.0
22.2
17.0
10.1
9.0
4.5
10.0
1.6
0.6
0.1
0.1
0.1
-
465.0
410.0
165.0
130.0
85.0
70.0
55.0
20.0
13.0
11.0
10.0
4.5
3.0
1.7
0.5
0.1
0.1
0.1
-
1.1%
16.2%
2.4%
0.0%
6.1%
1.5%
2.4%
-1.3%
6.3%
1.7%
-21.8%
6.5%
96.8%
-4.0%
-42.3%
0.0%
n.a.
-15.9%
n.a.
n.a.
World
3237.7
3505.9
Share EU
37.9%
37.6%
* Estimates
Note: cocoa year: 1 October to 30 September
Source: ICCO Quarterly Bulletin 2008
3727
38.7%
3.6%
The Netherlands
Germany
France
United Kingdom
Spain
Italy
Belgium
Poland
Ireland
Slovak Republic
Austria
Greece
Denmark
Latvia
Lithuania
Estonia
Portugal
Romania
Bulgaria
Czech Republic
32.2%
28.4%
11.4%
9.0%
5.9%
4.8%
3.8%
1.4%
0.9%
0.8%
0.7%
0.3%
0.2%
0.1%
0.0%
0.0%
0.0%
0.0%
n.a.
n.a.
The most important cocoa grinding EU member country is The Netherlands, followed by
Germany. Other countries with considerable cocoa grinding facilities are France and the United
Kingdom, while Spain, Italy and Belgium play a role as well. Grinding in new EU countries is
very limited in importance and, in fact, appears to be stagnating or decreasing.
Industrial demand for processed cocoa products is much more difficult to assess. The
International Cocoa Organization (ICCO) provides information on apparent consumption of
cocoa (grindings plus net imports of cocoa products and of chocolate products in beans
equivalent1) which could offer further insight in industrial demand. However, this information
should be used with caution, as it still does not represent total industrial demand for cocoa
products. Business-to-business trade of cocoa products is not reflected in these figures, as part
of the products produced is exported and is not included in apparent consumption, while their
inputs concern industrial demand. For example, Belgium is a large chocolate manufacturer,
importing huge quantities of cocoa butter, paste and powder. The industrial demand is quite
high. However, large quantities of chocolate are exported and not consumed locally, thereby
negatively affecting apparent consumption.
The largest consumers of cocoa are Germany, France and the UK, followed at a distance by
Italy and Spain. Most countries are showing increasing consumption of cocoa. Especially most
1
Using the following conversion factors: cocoa butter 1.33, cocoa paste/liquor 1.25, cocoa powder and cake 1.18,
chocolate and chocolate products 0.40 or 0.20.
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East European countries are showing large increases. The exception is the Czech Republic,
where cocoa consumption has historically been quite high.
Table 1.5
Apparent consumption of cocoa, 2001-2006, in 1,000 tonnes
2001/2002 2003/2004 2005/2006
EU total
1,219.1
1,310.2
1,371.6
Germany
282.6
307.1
310.0
France
215.1
229.9
239.2
United Kingdom
206.6
219.7
225.0
Italy
100.3
100.7
110.8
Spain
69.6
89.9
100.0
Poland
52.6
55.6
65.0
Belgium
54.2
59.0
56.0
Netherlands
31.0
33.0
35.0
Austria
28.1
33.2
30.0
Greece
20.4
22.2
25.1
Hungary
17.2
18.1
23.4
Czech Republic
23.8
19.8
21.0
Denmark
16.8
16.0
20.0
Portugal
15.8
16.0
16.7
Romania
12.8
13.7
16.6
Sweden
18.3
20.0
14.5
Ireland
19.0
14.7
13.0
Finland
10.6
11.5
12.7
Slovakia
3.7
5.6
9.1
Bulgaria
2.8
3.7
6.0
Slovenia
4.8
4.6
5.4
Latvia
3.1
5.8
5.3
Estonia
2.4
3.0
4.8
Luxembourg
2.1
2.2
2.2
Lithuania
2.8
2.4
2.0
Cyprus
1.4
1.6
1.8
Malta
1.2
1.2
1.0
Source: ICCO Quarterly Bulletin 2008
Average annual change
3.0%
2.3%
2.7%
2.2%
2.5%
9.5%
5.4%
0.8%
3.1%
1.6%
5.3%
8.0%
-3.1%
4.5%
1.4%
6.7%
-5.7%
-9.1%
4.6%
25.2%
21.0%
3.0%
14.3%
18.9%
1.2%
-8.1%
6.5%
-4.5%
Figure 1.1 below shows that, for chocolate confectionery, which is by far the largest end-use of
cocoa, consumption is very high in Belgium, the United Kingdom, Germany and Austria, all
having a per capita consumption of 8.00 kg or higher in 2005. Consumption of chocolate
confectionery had an overall increase between 2003 and 2005, which indicates that there has
been an increasing demand for cocoa beans and processed cocoa products in the EU. This is
also caused by increasing demand for European chocolate from Asia and Eastern Europe.
According to industry sources, there is a shortage of cocoa powder on the EU market.
However, the quality of powder from developing countries is often not sufficient and transport
is difficult, especially from areas with high humidity.
Between 2003 and 2005, total consumption of chocolate confectionery in the EU increased by
an annual average of 1.4%, amounting to 2.4 million tonnes in 2005. This excludes smaller EU
countries (Bulgaria, Cyprus, Czech Republic, Estonia, Ireland, Latvia, Lithuania, Luxembourg,
Malta, Romania, Slovakia, Slovenia), meaning that total consumption will be somewhat larger.
It is expected that the consumption of confectionary and drinks containing chocolate and cocoa
will continue to increase in the EU.
Thanks to increasing income in new EU member states, it can be expected that chocolate
consumption will increase in these countries. It is expected that consumption in these
countries, which, apart from the Czech Republic, consume far less chocolate than Western
European countries, will in time catch up with Western European levels. Interviews with
industry sources revealed that an increased demand especially for cocoa powder in these
countries was already being witnessed in confectionery, flavourings and beverages industries.
However, considering strong processing presence particularly in the western part of the EU,
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CBI MARKET SURVEY:
and an unfavourable development of the processing industry in the new EU member countries,
a substantial part of this demand increase is likely to be supplied by processing countries such
as The Netherlands, Belgium and Germany.
Figure 1.1
Consumption of chocolate confectionery in the EU, 2005, in kg per capita
12
10.7
9.9
10
9.0
8.3
8
6
7.1
7.0
6.4
5.2
4.7
3.6
4
3.2
2.9
2.6
2
2.0
1.5
0.7
Poland
Spain
Portugal
Greece
Netherlands
Hungary
Italy
France
Finland
Sweden
Denmark
Austria
Germany
United
Kingdom
Belgium
EU
0
Source: Caobisco (2007)
The feared diminishing demand for cocoa, which was expected due to changing legislation
(Directive 2000/36/EC) for the use of cocoa butter replacers (CBRs) in chocolate, did not
occur. According to industry sources, future trends will not suffer. This is because chocolate
consumption continues to rise in the European Union, replacement allowances were already
accepted in most major EU markets, while many substitutes allowed have also become pricy.
The markets for cocoa powder and paste in the EU are also positive.
Organic cocoa
According to industry sources, organic products still account for a small share of the total
market, but this share is steadily increasing. These sources indicate that the total industrial
demand for organic and Fairtrade beans amounted to around 25,000 to 30,000 tonnes in
2006, mostly in the EU and the USA. The EU takes by far the largest share of this demand,
since part of American demand for organic cocoa is also sourced through European importers.
The largest EU markets are Germany, The Netherlands and France - although non-EU member
Switzerland is also of great importance. It can be estimated that this has increased
substantially in the last years.
As European processors are seeing increased demand for organic cocoa products from their
buyers (mostly chocolate makers), demand for organic beans is increasing. The organic market
can be an important niche market for smaller producers of cocoa beans and butter. Several
industry sources (large processors) indicated that they are currently examining potential
suppliers of organic cocoa, while interest from specialized importers also remains strong.
Of importance is that Utz Certified, one of the major certification schemes within the coffee
trade, is also entering the cocoa trade. However, its impact on the cocoa market is still
uncertain.
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1.2
Market segmentation
Coffee and tea
The coffee and tea markets are more similar to each other and are therefore discussed
together. The market can be divided into three segments where coffee and tea are consumed
• At-home consumption – This market segment is becoming increasingly diverse. As was
discussed above, coffee used to be consumed mostly as soluble or ground coffee for coffee
filter machines. However, roasted coffee (espresso) beans are now also increasingly
consumed, and ground coffee is also packaged as one-consumption pods. The same holds
for tea. Next to the old fashioned tea-for-a-pot bags, single cup tea bags are very
prevalent, next to unbagged (often premium) tea. Tea bagged in pyramid bags are also
seen more often on the market. Moreover, the variety of brands, flavours etc. has
increased tremendously the last two decades. Consumers (but also small companies) can
purchase coffee and tea in these forms at:
o Supermarkets
o Specialty tea and coffee shops
o Organic shops
o Purchases through the internet are not very important for this segment.
• Out-of-home – 30% of coffee production takes place out of home, in restaurants, coffee
bars, cafes etc. Espresso bars like Starbucks, serving a great variety of high-quality
coffees, are becoming more popular.
• Consumption at work - is also of great importance, and is incorporated in the 30% above.
Most offices in the EU have coffee machines. Tea is also consumed in large quantities in
this institutional market. This market segment is partly provided for by the same players as
for the at-home segment. Small companies would still buy coffee and tea at retailers or if
they are larger might order it directly from distributors or retailers. Interesting is that
companies can now also purchase coffee and tea through companies offering coffee
through the internet. An interesting example is the Dutch company Ahrend, one of world’s
largest office supply companies, which also offers a large variety of coffee and tea
products, including organic and Fairtrade. However, large companies often have coffee and
tea vending machines. This market is dominated by a limited number of companies. For
example, in The Netherlands Sara Lee/DE has a strong position on the institutional
(vending machine) market. The institutional market is seeing a steady development
towards increasing quality.
Next to this, a segmentation of the EU market can be made by looking into regional
differences. This geographic segmentation is possible regarding the varieties of coffee
consumed (Arabica coffee more in the northern European states, and strong Robusta coffees
more in the Southern EU states) as well as the size of consumption (with consumption still
limited in many East European states (for example Poland, Romania, Slovakia, Bulgaria and
the Czech Republic) as well as the UK and high consumption in Scandinavia, Benelux countries
and Germany. The same holds for tea, with black tea consumption very much concentrated in
the UK, Ireland, and Poland. Green tea and herbal teas are relatively popular in Germany,
while in Denmark, Belgium, and Austria they are growing fast.
Cocoa
The chocolate industry uses about 90% of total cocoa produced worldwide, according to
Caobisco (2007, see Figure 4.1). The other 10% of cocoa is used in the production of
flavourings for food products, beverages and, to a very limited extent in cosmetics (cocoa
butter). Less than 5% of cocoa butter is used in cosmetics. These products include baking
cocoa, hot cocoa mix, baking mixes, ice-cream, breakfast cereals and other packaged food,
and cocoa(-butter) based body-care products.
1.3
Trends
Important shared patterns and trends which can be observed for the EU markets for coffee and
tea, as well as cocoa, are the following:
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•
•
•
•
Convenience and smaller portions – European people (including women) are working more
and more in jobs outside their home and have busy social lives. Moreover, the number of
single households is increasing. These developments have resulted in an increasing
demand for products like coffee and tea pods, easy to use at-home espresso and
cappuccino machines, chocolate bars, tea-for-one bags, iced tea and coffee, etcetera.
Sustainable products – An increasing awareness of the environmental and social aspects
has led to an increasing trend towards the certification of ‘sustainable’ coffee, tea or cocoa,
including organic, fair trade, Utz Certified, and other labels. Utz Certified (for coffee and
soon cocoa) greatly profits from its recognition among retailers. A Common Code for the
Coffee Community (4C) and a ‘Sustainable Coffee Initiative’ have also received support,
among which are the two largest roasters in the world (Kraft and Nestlé) and some of the
largest traders, such as ECOM. Currently, the sustainable coffee market accounts for about
2% of the market (Fair-trade and organic), but is growing rapidly. Information on the
consumption of organic coffee tea and cocoa is not available on a country level. However,
an indication is provided by overall organic consumption. According to the Research
Institute of Organic Agriculture (FiBL), in 2006, the biggest market for organic products in
the EU was Germany, with a turnover of €5 billion, followed by the UK (€3 billion). The
highest market shares of organic products of the total market with around 5% were in
Austria and Denmark (FiBL, 2007).
Health consideration – in line with the trend towards organic certification, is the trend
among EU consumers towards a healthy life-style and, consequently, increased
consumption of health food.
Single origin – Single origin products stand for quality, exclusivity, luxury etc. and are in
increasing demand in the EU. Notable is that for cocoa single origin mostly relates to
premium cocoa from Venezuela and Ecuador, while for coffee and tea the single origin
market is of much wider interest.
Coffee
• A few years ago, the electronics company Philips, together with the coffee roaster
Sara Lee/Douwe Egberts, introduced the Senseo coffee machine in The Netherlands. This
device uses coffee pods to make coffee. Since its introduction on the market, this concept
had become extremely popular and the popularity has spilled over to a growing number of
other EU member countries as well. In the espresso market, a variety of capsules and pods
is also available. What they have in common is convenience of preparation, consistency of
quality, and easy and mess-free disposal of spent coffee grounds (filter and espresso
pads). What they also achieve is an increase in the number of drinking moments which
would otherwise be lost. Easy-to-use cappuccino and espresso machines for use at home
are also gaining in popularity.
• Following the Senseo idea, Nestlé introduced the Nespresso machine concept in the EU
market. The product was introduced in the market with such success that from 2001 to
2006, sales of Nespresso rose more than 30% annually. Nowadays, espresso is the most
popular style of coffee across much of southern Europe. Nestlé praised the division for
driving the company's 7.8% increase in beverage sales during the first half of 2006 and
announced the opening of a new production and distribution centre in Switzerland (Food &
Drink, 2006).
• An increasing “coffee culture” is being felt in the EU. This trend kicked of with the market
entry of Starbucks. Customers can drink a wide variety of coffee for take-away or in the
café. Because of their popularity, especially with young Europeans, there is a spread of
coffee shops in the continent. Fast food chains are gearing up to take part in this rising
consumption. Many companies are now copying the idea and creating a “coffee celebration”
atmosphere in their cafés and products.
• Convergence in EU consumption patterns. For example, espresso and cappuccino are now
not only popular and well-known in Italy, but also in other EU member countries. In
general, regional variations in coffee consumption are becoming less pronounced and
coffee blends are becoming more universal throughout the EU. The addition of spices (i.e.
cardamom) in the coffee is also a new trend in the EU market.
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•
•
•
•
Single origin coffees are becoming more popular among EU consumers. This trend is,
however, less pronounced than in, for example the USA, since the quality of coffee in the
EU has always remained relatively high, unlike in the USA.
An increasing trend for single origin organic coffee is the interest in 100% Arabica coffee
beans for espresso.
Among all different kinds of certifications for organic and fair-trade products, an interesting
certification which may become a trend in the EU is a certification on emissions of CO2.
There is already such certification for the coffee sector in the German consumer market.
The certification comes from Italy, but the certified products are commercialized in
Germany. The certification is called Impatto Zero (http://www.impattozero.it) and one
already certified coffee is Caffe Agust (http://www.caffeagust.it).
Regarding the use of coffee waste products, an interesting trend in the EU is that utility
company Essent (http://www.essent.nl) in The Netherlands, plans to generate energy from
coffee husks. According to the expert commodity analyst F.O.Licht, Essent is already
importing the husks from Brazil (around 3,200 tonnes) (F.O.Lichts, 2008).
Tea
• The trend towards convenience had led the tea industry to develop products like tea tablets
and ready-to-drink teas such as iced tea. On the other hand, the introduction of instant tea
into the UK market two decades ago turned out to be a commercial disappointment. More
recently, Douwe Egberts of The Netherlands introduced tea pods in The Netherlands, which
can be used in Senseo coffee machines. Industry sources expect that these so-called ‘Tpads’ will become popular in other EU member countries as well, just like its coffee pods
counterpart.
• Responding to the growing number of single households and to the need to vary between
tea flavours, the ‘tea for one’ packages, often containing various flavours, are becoming
more popular.
• The tea market has seen a decline in sales of mainstream black tea bags, an increase in
consumption of green teas, a growing interest in fruit and herbal teas, and growth in the
consumption of sustainable tea.
• The availability of herbal teas has increased fast in recent years, with much innovation in
new blends, new herbs etc. Herbal teas and infusions are becoming increasingly popular.
Noteworthy is the consumption of rooibos tea (officially not a tea), which has shown a very
strong surge in the past few years and has become one of the principal herbs used in teas,
especially in North West Europe. However, rooibos is almost exclusively produced in South
Africa.
• Another consumption trend is the increasing appeal of teas with ginger, especially during
winter time. The use of ginger is related to the prevention of colds, which makes this
ingredient attractive to consumers. This is related to a larger trend where health conscious
Europeans are looking for tea with health properties, for example nettle.
• The consumption of organic fennel tea for babies is also an increasing trend.
• Pyramid teabags are the trend for the future with leaf tea/herbs instead of teabag tea.
Cocoa
• The modern consumer does not confine himself to the traditional three meals a day
(breakfast, lunch and dinner), but is eating smaller bites (‘snacks’) at more frequent
intervals: ready-to-eat products or products requiring very little final preparation. Suppliers
of fast food and (chocolate) snacks have benefited from people’s increasing tendency to eat
snacks.
• The chocolate industry is the largest end-user of cocoa. Future growth in chocolate
confectionery sales is being sought in special occasions (St. Valentine's Day, Easter or
Christmas) and in special or attractively packed chocolates for young people, e.g. chocolate
for children, or chocolate for nutritional replenishment after sports. Furthermore, the
development of EU consumption is to a considerable degree dependent on consumption in
East European member states.
• Within the chocolate market, the health trend is fuelled by marketing campaigns portraying
chocolate as a healthy product. According to industrial sources, this is leading to a shift
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•
•
•
•
•
1.4
towards darker chocolate, which drives the consumption of chocolate for the future.
Specific ‘healthy chocolate’ relates to marketing of chocolate containing very little sugar,
the use of other sweeteners, and the use of cocoa species with high polyphenol content.
Much research is currently being conducted into which cocoa species contain these
antioxidant substances, so that known species are higher in demand. Actually, according to
the Food Navigator (an online news magazine), Nestlé announced in March, 2008 the
establishment of a research and development (R&D) facility dedicated entirely to dark and
premium chocolate (Food Navigator, 2008).
Chocolate powder with chilli, and dark chocolate with ginger or pepper, are increasing
trends in the EU market. In addition, orange peels are highly used to give an extra flavour
in dark chocolates.
A new trend for hot white chocolate drinks is starting up now in North America and is
expected to reach the EU consumer market in no time (Food Ingredients First, 2008).
According to a market research group - Global Industry Analysts (GIA) - strong economic
growth will boost global confectionery sales to € 101 billion by 2010 (Food Navigator,
2008). This will drive the demand for European confectionery products and also ingredients
of cocoa in the EU. As indicated, confectionery and chocolate products produced in
countries such as France and Belgium have a good name in other regions.
According to industrial sources, there is a limited amount of organic and fair-trade cocoa in
the world. The industry is searching for special varieties from specific sources and, when
those are organic-certified, they become even more interesting. Prices can be very high for
high-quality organic cocoa varieties.
Utz Certified has also started working with cocoa. The first aim is Ivory Coast producers.
Opportunities and threats
Opportunities for and threats to for exporters of coffee in developing countries:
Opportunities:
+ Green coffee is mostly supplied by developing countries.
+ The popularity of sustainable coffee is increasing. Premium quality coffees, such as
espresso beans are increasingly consumed. Moreover, this development is becoming
ever more widespread across the EU.
+ Single origin coffee, with outstanding characteristics, could also offer interesting
opportunities for developing country producers. The relation between buyers and
producers is more direct. It offers cooperatives with a regional focus the opportunity
to promote their products and to find EU companies carrying regional specialties in
their assortment.
Threats:
- Most of the processing of coffee takes place within the EU itself. This applies to
roasting and the production of decaffeinated and soluble coffee. On the one hand, this
leaves little opportunity for value addition in developing countries but, on the other
hand, it also means that investments in processing facilities are not needed in the
developing countries.
- The roasting and blending companies are highly concentrated in the EU, which makes
it difficult, particularly for small-scale producers, to enter the coffee market.
- Consumption of coffee is not increasing much in many EU countries, and overall
growth is limited. However, several other countries are showing high increases in
coffee consumption.
Opportunities for and threats to exporters of tea in developing countries:
Opportunities:
+ Black tea still constitutes the largest share of EU tea consumption, but green tea is
increasing in popularity, offering good opportnities for producers of green tea.
+ Herbal teas and infusions are on the rise, offering opportunities for producers of herbs
used in herbal teas and infusions.
Threats:
- Tea consumption is decreasing in the majority of EU member countries. However, the
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CBI MARKET SURVEY:
pace of the decrease is becoming smaller. Several non-traditional tea countries are
showing a considerable increase.
- Most of the tea-packing occurs in the EU. On the one hand, this leaves little
opportunity for value addition in developing countries but, on the other hand, also
means that investments in processing facilities are not needed.
- The tea market is highly concentrated. Each country or region has several dominant
players, leaving only a limited role for smaller companies concentrating on niches. This
makes approaching the market more difficult for smaller exporters.
Opportunities for and threats to exporters of cocoa in developing countries:
Opportunities:
+ Increased consumption in the new EU member states is likely to spur the demand for
cocoa beans in the EU. The same holds for the increasing demand from Asian
countries for (EU) chocolate and confectionery products.
+ Demand for organic beans is increasing, as European processors, as well as
specialised importers, are seeing increased demand for organic cocoa products from
their buyers (mostly chocolate makers). In fact, consumption of organic cocoa and its
end-products is increasing more than conventional demand and this higher growth is
expected to continue in the coming years.
+ The organic market can become an important niche market for smaller producers of
cocoa beans and butter.
+ Demand for single origin and high-quality cocoa is large. However, only certain origins
are of interest, such as Venezuela and Ecuador.
+ Thanks to its large production capacity and trade function, in particular The
Netherlands, but also Germany, offer opportunities to enter the EU market.
Threats:
- A major part of the cocoa trade is in the hands of a few large companies, which makes
it difficult for (smaller) developing country exporters to enter the market.
- The EU market for cocoa powder shows a positive development. However, prices for
powder on EU markets, and the often superior quality produced by EU processors,
making it easier in use for producers of confectionery and beverages, means that
powder offers few prospects for conventional DC producers.
1.5
•
•
•
Useful sources
Handbook by FiBL, SIPPO and Naturland “Organic coffee, cocoa and tea”; downloadable at
http://www.fibl.ch/buehne/publikationen/pdfs/verzeichnisse/handbook-coffee.pdf for € 38.
Information about FairTrade for coffee, tea and cocoa can be found at:
http://www.fairtrade.net.
Information about the developments in the beverage and food industries can be found at
online-magazines such as Just Drinks (http://www.just-drinks.com), Food and Beverage
International (http://www.foodandbeverageinternational.com) and Food and Drink
International (http://www.foodanddrinkinternational.co.uk).
Coffee
• Another interesting publication is "The State of Sustainable Coffee: a study of twelve major
markets" published in 2003 by the World Bank, and “Coffee Markets: New Paradigms in
Global Supply and demand”. Both can be downloaded at
http://www.iisd.org/pdf/2003/trade_state_sustainable_coffee.pdf
• International trade Centre’s coffee guide: http://www.thecoffeeguide.org
• International Coffee Organization’s Coffee Market Reports, online available at
http://www.ico.org/show_doc_category.asp?id=2
Tea
• International Tea Committee's Annual Bulletin of Statistics 2007, which can be purchased
at http://www.inttea.com/publications.asp
Page 17 of 63
CBI MARKET SURVEY:
Cocoa
• An extensive range of reports on the international cocoa market is available at
http://www.marketresearch.com/search/results.asp?sid=88777351-368538246280875009&query=cocoa
• An interesting source for information for cocoa is
http://r0.unctad.org/infocomm/anglais/cocoa/sitemap.htm
• International Cocoa Organization at http://www.ICCO.org
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2
PRODUCTION
2.1
Size of production
Coffee
Except for some scattered small-scale local production in the Mediterranean area, no
production of coffee takes place in the EU. Almost all coffee consumed in the EU is roasted
within the EU, or in Switzerland. However, these roasters are not competitors to developing
country producers, but buyers (often through, or also acting as, traders), because developing
countries do not play a role on the European market for roasted coffee. These companies are
discussed in combination with the trade structure of coffee in Chapter 8, and separately in the
surveys covering individual EU countries.
Tea
Due to climatic conditions, tea production does not take place in the EU. Only very limited
production takes place in overseas territories, such as the Azores Islands, which are part of
Portugal. Therefore, the availability of tea for consumption in the EU market entirely depends
on imports from developing countries like Kenya, India, China and Sri Lanka. Almost all tea
consumed in the EU is blended within the EU. These blenders are not competitors to
developing country producers, but are buyers (often through, or integrated with, traders),
because developing countries do not play a role on the European market for tea blends. EU
blenders are discussed in combination with the trade structure of tea in Chapter 8, and
separately in the survey’s covering individual EU countries.
Cocoa
Because of climatic conditions, no production of cocoa beans takes place in the EU. However,
the EU is the largest grinder of cocoa beans in the world. Therefore the EU is a buyer of cocoa
beans, but EU grinders are also competitors to developing countries on the EU and global
market for processed cocoa products. In order to gain a picture of the production of processed
cocoa products in the EU, the grinding data provided in the previous chapter offers a good
picture of the major EU producing countries. Actual production data for cocoa butter, paste and
powder are not available.
The EU grinds more than 1.4 million tonnes of cocoa beans, of which The Netherlands alone
accounts for more than one third. The Netherlands is also the world’s biggest producer of
cocoa powder, accounting for a share of about 25% (European Cocoa Association 2007).
Germany is increasing in importance as producer of processed cocoa products, while France
and the UK are the other major EU countries where grinding takes place. EU grindings are
increasing faster than global grindings. However, for several years now, grindings in Africa
have been increasing faster than those in Europe.
Major grinders in the EU are discussed in combination with the trade structure of cocoa in
Chapter 8, and separately in the surveys covering individual EU countries.
2.2
Trends
The situation for coffee and tea as described above is not expected to change. Production of
green coffee and tea will remain limited to tropical countries, whereas the further processes of
roasting and blending will continue to take place in the EU. Trends for these companies are
discussed in the following chapter.
Regarding cocoa paste, butter and powder, in the coming years the EU will continue to be the
principal production area in the world. German production in particular is expected to continue
to increase. The European cocoa processing sector is strongly consolidated and, thanks to its
modern production techniques, very well able to compete with other regions. European quality
processed cocoa products are considered of superior quality and get a higher price than their
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African counterparts. Moreover, especially cocoa powder is relatively difficult to transport,
especially from high-humidity areas. The use of sterilisation means that the product cannot be
used for some applications. The role for developing countries in cocoa powder is therefore
expected to remain limited.
2.3
+ The EU is fully dependent on coffee and tea grown in developing countries.
± East European countries are experiencing an increasing demand for processed cocoa
products; however, processing capacity is very limited and, in some countries, is
decreasing. This could offer an opportunity for developing country producers. However,
these countries are increasingly sourcing processed cocoa products from West European
countries.
- The EU has a very strong competitive cocoa processing sector, competing with products
from developing countries.
- The quality of EU cocoa products is (seen as) higher than those from developing countries.
2.4
Useful sources
Information sources for global production of coffee, tea and cocoa are:
• Coffee, tea, as well as cocoa: FAOSTAT at http://faostat.fao.org
• Coffee: International Coffee Organization’s Coffee Market Reports, online available at
• Tea: International Tea Committee's Annual Bulletin of Statistics 2006, which can be
purchased at http://www.inttea.com/publications.asp
• Cocoa: International Cocoa Organization at http://www.ICCO.org
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3
TRADE STRUCTURE
3.1
Distribution channels
Introduction
Each of the three product groups discussed in this survey is distributed in a different manner.
The trade structures for coffee (Figure 8.1) and tea (Figure 8.2) share characteristics, but also
differ in, for example, the role of warehouses and auctions. Particularly the cocoa trade (Figure
8.3), with its four main products of cocoa beans, paste, butter and powder and its industrial
focus, has an entirely different trade structure. Furthermore, an increasing proportion of cocoa
is processed in developing countries; this happens far less in the tea and coffee sector, for
which blending and roasting respectively predominately take place in the EU. Processed cocoa
products are then exported to the EU market. This processing can be conducted by local
manufacturers, but is also often conducted by international processing companies and
chocolate manufacturers. Therefore, please note that Figure 3.3 describes the trade channels
for cocoa beans as well as processed cocoa products. Where necessary, the respective
products or processing stage has been included in italics.
Because of these differences and in order to be comprehensive, this chapter shows different
trade structures for each of the three product groups. Furthermore, this section will pay
particular attention to trade channels for organic/Fair Trade products, as these offer additional
opportunities to exporters in developing countries. Moreover, please note that, to reduce the
complexity of the figures, re-exports, which can take place at different levels in the trade
structure, have been excluded.
Figure 3.1
Smallholders
Trade structure for coffee
Plantations
Growers'
association/
coorperative/
collector
(Foreign)
Exporters
local (also
Limited but increasing
foreign owned)
exports of roasted
roasters
coffee to EU
EU border
(local)
consumers
Broker/agent
Importers
Roasters
Retail channel
(Supermarkets,
specialty coffee
shops, organics
shops)
Catering
channel
(institutions,
restaurants,
coffee bars,
vending
machines)
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Figure 3.2
Trade structure for tea
Small holders
Plantations
Growers'
association/
coorperative/
collector
Bought leaf
factories
Estate
factories
Broker
Local
subsidiaries of
blenders
Auction
Broker
Exporter
EU border
Trader/
distributor
Blender/packer
Retail channel
(Supermarkets,
specialty tea
shops, organic
shops)
Catering
channel
(institutions,
restaurants,
vending
machines)
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Figure 3.3
Plantations and
large farms
Trade structure for cocoa and processed cocoa products
Smallholder cocoa grower
often member of
association/cooperative
growers' association/
coorperative/ collector
Exporters
local grinders
local end-product
manufacturers
EU border
(local) consumers
Broker/agent
Trader/import merchants
Storage companies
(Processed in
countries of
origin)
Processors
only butter
Cosmetics
powder
paste, butter
Chocolate manufacturers
industry
Other food
companies
using cocoa
products
Retail channel
The following pages discuss the main distribution channels and their role in the (organic)
coffee, tea and cocoa trade. Please refer to the surveys on EU countries for website of the
companies mentioned in this section, as well as additional companies.
Producers, collectors and cooperatives
Tea, coffee and cocoa can each be produced by smallholders, but production also takes place
in plantations or large farms. Smallholders can form a cooperative, often enjoying higher
prices due to internalised transport facilities, market knowledge, direct exports and sharing of
technical knowledge, resources etc. Export systems can either be handled by local companies
and export companies/organisations or government agencies, although the frequency of that
actually happening has greatly decreased. Auctions are still an important next step for tea in
the trade structure, and they play a limited role in the coffee trade in Africa, especially in
Kenya, Ethiopia and Tanzania. Also, foreign exporters, such as Neuman Kaffee
(http://nkg.net), which have export companies in most coffee producing countries, play a large
role.
Traditional coffee cultivation, which involves recreating the coffee plant’s original shaded
growing conditions in (semi-)diversified environments, is mainly conducted by smallholders.
This is also the origin of organic coffee, where mono-cultures are hardly possible in technical
terms. However, most of the conventional coffee is produced on mono-culture plantations.
These have an especially large scale in producing countries such as Brazil and Vietnam.
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Tea is traditionally a plantation product, but in many countries it is also cultivated by
smallholders. In Sri Lanka and Southern India in particular, smallholder production plays a
large role. Smallholders sell their green leaves to middlemen, plantations or processors, often
through contractual arrangements. Since low prices are paid for green leaves, especially due to
the (sometimes justified) reputation of inferiority compared to plantation produced tea, profits
made at this level are low. Initial processing, rolling fermenting drying etc, takes place near
the tea production areas. In the Indian situation, small farmers sell to ‘bought leaf factories’,
as they rarely own processing facilities of their own. In Kenya, many small holders operate cooperative processing plants.
Cocoa is typically produced by smallholder or family subsistence farming. Large scale
cultivation in plantations occurs in Brazil, Ecuador and Malaysia. This situation exists because
of the fact that cocoa cultivation is ill-suited for mechanisation. These plantations are often
owned by or produce exclusively for international corporations. Initial processing, involving
seed extraction, fermentation and drying, takes place at the farm level. Furthermore, cocoa
beans are increasingly processed in the country of origin, after which cocoa butter, powder and
paste are exported to the EU. These products are mostly traded through traders in the EU, but
in some cases also directly to EU cocoa processors and food processors.
Brokers
Brokers are intermediaries who bring buyers and sellers together, for which they get paid a
commission. Products do not physically come into the possession of brokers. Customers can be
trading companies, but are mostly processors. Many larger brokers are active in both coffee
and cocoa, and then especially on the futures and options markets. Several (very) large
brokers are affiliated with the Federation of Cocoa Merchants. These are mostly located in the
UK and include Marex Carlton (http://www.marexfinancial.com/commodities_argrl.htm),
Sucden (http://www.sucden.co.uk), Man Financial (http://www.manfinancial.com), Fimat
International (http://www.fimat.com), TRX Futures (http://www.trxfutures.com/home, part of
Neuman Kaffee) and several financial institutions, but also Calyon Financial SNC
(http://www.calyonfinancial.com) in France. Most of these parties also broker coffee.
Furthermore, specialised, smaller brokers exist. In certain cases, brokers represent a specific
party either as its selling agent or its purchasing agent. Many importing companies maintain
representatives in producing countries, either through their own offices or agents. These can
form an interesting channel for exporters to approach the European market, apart from
directly contacting European offices. Tea brokers play an especially important function as will
be explained below, but they can also play the role described above as an intermediary
between exporters and importing companies.
Tea brokers and auctions
Tea is still for a considerable part traded at auctions. Nowadays, the main auction centres are
Kolkata, Cochin, Colombo, Mombasa, Blantyre and Djakarta. The system is the same for all
auction centres. The tea auction system brings the buyers (traders, agents and
importers/blenders from consumer countries) and sellers (estates/small holder cooperatives)
together, to determine the price through interactive competitive bidding on the basis of prior
assessment of quality of the tea. If bidding does not reach the price desired, the broker or
producer can withdraw the tea from the auction.
These auctions are heavily dominated by a few privileged brokers. 11 brokers are registered
with the Tea Board of Kenya, while there are 4 registered brokers at Kolkata, the largest of
which are J. Thomas & Co. (http://www.jthomas-india.com), Carritt Moran & Co.
(http://www.carrittmoran.com) and Contemporary Targett (http://darjeelingtea.com). J.
Thomas & Co. Pvt. Ltd., the largest tea broker in the world, handles one-third of all tea
auctioned in India. Carritt Moran & Co. Ltd., the world’s second largest tea broker, handles
around a fourth of teas auctioned in India. Generally, brokers must be registered with the
appropriate tea board in order to operate, which limits the number of auction houses where
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tea can be sold. New buyers are inherently discriminated against, while unknown buyers are
only marginally allowed to trade at auctions.
More and more tea is sold through forward contracts and private sales. The benefit of this to
producers is often considerable; they receive payment faster, endure less uncertainty about
sales and price, and can avoid the charges associated with auctioning tea (broker fees,
warehousing). Likewise, the system appeals to buyers, because it guarantees faster delivery
(and therefore higher quality). Especially non-traditional exporters (i.e. excluding India, Sri
Lanka and Kenya) sell their tea directly to importers. Countries such as Argentina, China etc.
do not work with auction systems at all. Next to tea, limited quantities of (African) coffee are
also traded through auctions, mainly in Ethiopia, Kenya and Tanzania.
Traders/ Import Merchants
Traders play a very important role for all three product groups, but especially for coffee and
cocoa (both for cocoa beans and processed cocoa products). Vertical integration within the tea
industry between blenders and traders is considerable, while for coffee, roasters also play a
considerable role as traders. Integration between cocoa grinders and traders has also
increased, with most processors now part of larger agro-industrial companies or large multicommodity trading companies. The trader/importers level of the trade structure offers good, if
not the best, opportunities for market entry for all three product groups.
International coffee traders went through considerable restructuring and market concentration
in recent decades. While some of the large number of coffee traders went bankrupt as they
were unable to compete, many merged into larger companies. Large players are Neumann
Gruppe (Germany), British-Swiss Volcafé-ED&F Man (http://www.edfman.com) and ECOM
(http://www.ecomtrading.com) from Switzerland. These three main traders control almost half
of the coffee trade. Coffee is generally purchased from the exporting countries by international
trade houses, although the largest European roasters also maintain their own in-house buying
companies. In the main, however, roasters tend to buy their coffee from international trade
houses and specialised traders representing specific exporters in producing countries. At the
same time, prospects are still good for smaller specialised traders who trade in nonconventional coffees (high quality, specific origin).
Traditionally, most traders and dealers operate in ports where coffee is delivered, the major
trading points being Hamburg (Germany), Rotterdam (The Netherlands), Le Havre, Marseilles
(France), Antwerp (Belgium) and Trieste (Italy). The structure of trade is broadly similar
across the EU, with the exception of the Nordic countries, which lack main traders. Their
imports are conducted by roasters and agents, often through traders in the main trading
centres. Furthermore, traders in some East European countries increasingly import from the
main EU coffee centres, instead of directly from producing countries.
The vertical integration for tea in the trade structure is the most advanced. The largest tea
importers are also major blenders and packers. Other important tea importers often also have
their own blending and packing facilities, while smaller importers cooperate closely with
blenders and packers. A large number of traders operates in the European Union, but western
trade is dominated by only a few multinational companies. The UK plays a very important role
in the tea trade. At the global level, 85% of world production is sold by multinationals. Four
companies are most dominant in the tea trade:
• Unilever (Brooke Bond, Lipton, Unilever Trading Company (UTC) London) from The
Netherlands/the UK, which owns plantations in India and Eastern Africa (11% of Kenyan
output for example) http://www.unilever.com
• Van Rees (trader/blender, supplying many packers) The Netherlands, which has no
important role in tea production http://www.vanrees.com
• James Finlay (Scotland), possessing major production areas in Kenya, Uganda, Bangladesh
and Sri Lanka http://www.finlays.net
• Tetley/Stansand (United Kingdom). Tetley is part of Tata Tea, one of the principal Indian
brands, owning major production areas in India and Sri Lanka. http://www.tetley.com
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The large tea companies have a considerable influence on supply and demand, and thus on
prices at auctions. Their ownership of both plantations and processing factories is essential in
this. Other blenders, such as Teekanne (http://www.teekanne.de) Germany also import
considerable quantities into the European Union.
The first customers for cocoa beans and processed cocoa products in the EU are usually
traders, rather than grinders or final product manufacturers (for processed cocoa products). As
mentioned above, the distinction between grinders and traders is decreasing, with more and
more grinders being integrated with trading companies, or larger agro-industrial companies.
There is still a considerable number of ‘pure’ traders, however, as these also trade in
processed cocoa products, which are only very seldom imported directly by final product
manufacturers.
Larger processors often have a separate purchasing department which sources directly in
developing countries, but these also source a lot through traders. Some (vertically integrated)
chocolate manufacturers also buy directly in developing countries, but these transactions are
normally confined to fine or flavour cocoas, or trade between firms with long-term
relationships, or belonging to the same group.
Most major traders are either located in The Netherlands (with examples such as Theobroma
(http://www.theobroma.nl), Huyser Moller & Co. (mailto:[email protected]),
Daarnhouwer (http://www.daarnhouwer.nl), Bensdorp (part of Barry Callebaut) and Unicom
(part of Indcresa); the United Kingdom, where one of the two major future trading platforms
(LIFFE) for cocoa is located (with companies such as Etco International Commodities
(http://www.etco.co.uk), Finagra (http://www.londononline.co.uk/profiles/61231), Louis
Dreyfus (http://www.louisdreyfus.com) and ED & F Man)); Germany (Albrecht & Dill Trading
(http://www.albrecht-dill.de), Vogler & Trummer (http://www.vogler-trummer.de), RAMM
(mailto:[email protected]) and Corinth (http://www.corinth.de)); Switzerland
(Ecom (http://www.ecomtrading.com), Taloca (part of American Kraft Foods (www.kraft.com),
Noble Resources (European branch of Asian company http://www.thisisnoble.com), Walter
Matter (http://www.columbus-finder.de/webvisitenkarten_133986_Walter-Matter-SA.html)
and Barry Callebaut Sourcing (http://www.barry-callebaut.com)); and France (Contango
Trading (http://www.cocoafederation.com/membership/members.jsp?alpha=C), Orebi & Cie
(http://www.hotfrog.fr/Entreprises/Orebi-Et-Cie) and Touton (http://www.touton.fr). The
Belgian trader Efico (http://www.efico.com) is also of importance.
Storage companies
These companies can play a role in the cocoa trade. They receive and store products on behalf
of clients. They do not own the products, but often act as independent surveyors testing the
quality of the products stored. Examples are B&P Commodities & Logistics
(http://www.bpchull.co.uk) in London, Cotterell (http://www.cotterell.de) in Amsterdam and
Hamburg, Handelsveem (http://www.handelsveem.com) and Unieveem
(http://www.schuttergroep.nl) in Amsterdam, Interporto Rivalta Scrivia
(http://www.interportors.it) in Italy, and Quast & Cons. (http://www.quast-cons.de) in
Hamburg.
Processors
Within the coffee market, the level of vertical integration between roasters and international
traders remains limited. Although large roasters also import coffee from producing countries
themselves, in general the trade structure follows the structure as shown in figure 8.1 from
exporters to importers to roasters. Roasting of the original green coffee usually takes place in
consumption countries, but in the EU it is done to a large extent by multinationals supplying
several EU countries from their production facilities.
The level of concentration in the coffee roasting sector exceeds the level of concentration in
the coffee trade. In 2002 the top two roasters (Nestlé (http://www.nestle.com) of Switzerland
and Kraft Foods of the USA (with European companies such as Jacobs Kaffee
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(http://www.jacobs.de), Gevalia (http://www.gevalia.com) in Sweden, Grand Mere and Carte
Noire (http://www.kraft.com) in France and internationally under the Kraft label) controlled
almost 60% of the world market for roasted and instant coffees. The top five players controlled
87% of the market, while national and specialty niche players constitute the remainder.
However, Europe’s mega-roasters have also entered the specialty market. Therefore small
producers are, also in the specialty sector, increasingly dependent on specialty importers and
agents for efficient entry to the EU market.
Nestlé dominates the soluble market with a global market share of 50% and is especially
dominant in the EU. Kraft is the second player, the two together accounting for more than
three-quarters of the market. The scope for outside manufactures lies mostly in private label
production. The role of coffee producing countries in soluble coffee consumption in the EU has
decreased, with most production taking place in the EU (Agitrade 2006). Of the three soluble
coffee segments, premium freeze-dried, conventional spray-dried and cheap spray-dried (in
the eastern EU), only the latter two are produced in developing countries.
The level of concentration in the roasting sector is very different per country, however, with
different multinational and smaller nationally oriented roasters dominating the market, ranging
from almost the entire market in Finland to around three quarters in Italy. In virtually every
EU country small roasters continue to play a role, even though their marketing expenditures,
which for major roasters can range to up to 6% of sales revenue, are fairly limited. They sell
under their own brand name or supply retailers with private label products. Moreover, the
number of roasters can still be very high, although often decreasing. In Italy and France, for
example, there is still more of a tradition of smaller roasters, with their number still in the
hundreds for both countries. Italy has several large specialty roasters, most notably Illy
(http://www.illy.com) and Lavazza (http://www.lavazza.com) which play a strong role across
Europe. East European countries import a relatively significant share of their roasted and
soluble coffee needs. Especially Italy plays a large role in supplying East European markets
(ITC 2002).
Tea is exported at a relatively early stage in the supply chain. The most lucrative value adding
activities, blending and packaging, accruing up to 50% of the consumer price, are carried out
by blenders in consumption countries. Tea processing is less concentrated internationally than
the international trade, but concentration on national markets can be very large. The top three
firms hold around 60% of the market in the United Kingdom and around two thirds in Germany
and Italy. This can concern worldwide players such as Lipton, the world’s principal tea brand,
or national players. Important international packers in the EU are:
• Unilever (Lipton, with a world market share of 10% and a name for innovation) (15% of
black tea sales)
• Tetley
• Hillsdown Holdings - http://www.hillsdown.com
• Sara Lee International (Pickwick) - http://www.pickwicktea.com
• Ostfriesche Tee Gesellschaft (OTG) (mostly Germany but also surrounding countries) http://www.otg.de
• Teekanne (mostly Germany but also surrounding countries)
• R. Twinings - http://www.twinings.com
Next to these, a large number of national players and niche and specialty players is active on
the European market.
The next step for the coffee and tea trade is the marketing of the retail and
catering/institutionally packaged products. This is either done directly to large retailers and
catering-companies/institutions or through distributors supplying smaller and specialty players.
The latter are also more often dependent on specialty traders and processors. In most
countries, the retail sales for in-home consumption generally account for 70-80% of the overall
market. Because of increasing retail concentration and buying power in consuming countries
and increasing private label sales, the coffee and tea trade are becoming further concentrated
across the board.
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Also of importance is the vending machine market, which has several processing companies
focussing on this specialised market, such as Riant, of The Netherlands. Furthermore, several
large processors have branches focusing specifically on the vending market. This sector is now
also following the trend of upgrading the quality, as is the coffee and tea market in general.
Cocoa processing companies can be divided in two types. Firstly, the grinding industry,
producing cocoa paste, butter, and powder from cocoa beans (also cocoa cake), and secondly,
secondary processing companies which buy processed cocoa products, (in general cocoa
butter) to process them further, with the goal of selling these to certain end-product
manufacturers. For example, cocoa butter may be deodorised or refined before it is sold to the
cosmetics industry. However, this represents a relatively small share of total industrial demand
for cocoa.
One of the most important processors (and trader) of cocoa beans is Armajero (UK
http://www.armajaro.com) with production in Hamburg, France and Indonesia. It also owns a
controlling share in Indcresa (Spain http://www.indcresa.com) one of the largest producers of
cocoa powder in Europe, and owns Unicom, a large trader in Amsterdam. Some of the largest
producers are located in The Netherlands such as Gerkens (http://www.gerkenscacao.com), a
subsidiary of Cargill, ADM (http://www.admworld.com), Schoemaker
(http://www.janschoemaker.com) and Dutch Cocoa (http://www.dutchcocoa.com). German
producers include Euromar (http://www.euromar.de) and Schokinag
(http://www.schokinag.de), whereas large Spanish producers include Moner & Llacuna
(http://www.hotfrog.es/Empresas/Moner-y-Llacuna) and Natra (http://www.natracacao.com).
Chocolate manufacturers and other end-industries
End-industries process cocoa paste, cocoa butter and cocoa powder into consumer products
such as chocolate, cocoa confectionery, cocoa beverages, and cosmetics (the latter being the
smallest segment and applying only to cocoa butter). Some end-product manufacturers who
need large quantities of these ingredients (on a regular basis) purchase their products directly
from producers abroad. However, it is unlikely that manufacturing companies or retail
companies themselves will be acting as buyers of these products from the country of origin.
End-product manufacturers often prefer to use the trading companies discussed above or
agents, as the latter offer a reference situated within their own country. However, directly
contacting chocolate manufacturers can offer insight into the sourcing strategies of such
companies and reveal their suppliers.
With more than 2,000 companies represented by Caobisco, the Association of the Chocolate,
Biscuit & Confectionery Industries of the EU, it is not feasible to make a selection for this
market survey. To locate these companies, please refer to the country associations, which can
be found through http://www.caobisco.com. However, the market for chocolate is highly
concentrated. For example, regarding industrial chocolate, Barry Callebaut by itself accounts
for 50% of world production. Regarding consumer chocolate, six manufacturers account for
50% of global chocolate sales. These are: Nestlé, Mars (http://www.mars.com), Philip
Morris/Kraft (http://www.kraft.com), Cadbury (http://www.cadbury.co.uk), Ferrero
(http://www.ferrero.it), and Hershey’s (http://www.hersheys.com).
Consumers buy chocolate or cocoa beverages and confectionery directly through supermarkets
and specialty chocolate shops, but these products are also consumed through the catering and
institutional sector.
Channels for certified products
Although the markets for sustainable coffee, tea and cocoa are relatively small, they offer
interesting opportunities for smaller exporters in developing countries, as discussed above.
Importers of certified coffee, tea and cocoa are often not specialized in coffee, tea or cocoa but
have an organic (or/and FairTrade) focus, concentrating on a large number of food products.
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Furthermore, they are mostly dedicated primarily to regular, and not specialty, qualities of
coffee, tea and cocoa. These organic commodity importers are for example Tradin
(http://www.tradinorganic.com), Do-it (http://www.organic.nl) and Doens
(http://www.doensfood.com) in The Netherlands, Rapunzel (http://www.rapunzel.de); Gepa
(organic/fair-trade http://www.gepa.de), and Care Naturkost (http://www.care-natur.de) in
Germany; and Claro Fair Trade (http://www.claro.ch) in Switzerland. Next to these specialised
organic food ingredients traders, conventional trading houses of coffee, tea and cocoa, play an
increasing role in the trade in organic products. Some of them started earlier to incorporate
organic commodities, others started later, once the organic trend appeared to be stronger than
they expected. The trade structure for FairTrade certified products is more or less comparable
to the organic trade structure and also partly overlaps in terms of companies. However,
specific Fair-trade players also exist.
Coffee
Previous logistic and administrative issues concerning redistributing organic coffee from
containers into smaller batches, has largely been solved by the introduction of Certificates of
Import, introduced in 2003.
FairTrade and organic certification, in that order, have been on the market longer than Utz
Certified, but Utz Certified is growing more rapidly than the other certification schemes.
According to the Utz Certified website, it surpassed the other schemes in importance in 2006
thanks to the support it enjoys from major retailers. Rainforest certified products play a limited
role in the EU. New types of certification (for example Bird Friendly) have recently entered the
market, but industry and market response to them has yet to be evaluated.
In recent years, supermarkets have gained hugely in importance for the sales for certified
coffee. The primary retail chains in the EU offer organic and Fair-Trade coffee and often have
their own brand of organic coffee, or sell Fair Trade brands (for example Fair Trade Original).
Utz Certified also began as the certification scheme of the Ahold Coffee Company
(http://aholdcoffeecompany.nl) and is sold in Ahold supermarkets across Europe.
The primary means for selling certified coffee is now conventional commerce (supermarkets).
World Shops are present in all the European countries and are related to the Fair-Trade
initiative. Furthermore, there are also organic food supermarkets and stores which sell organic
coffee. Another major channel is institutional consumption: sales made to company and
government offices. In Europe, the official coffee of the European Parliament is Fair-Trade.
Supermarkets acquire the services of large-sized (not mega-) roasters; among them are Drie
Mollen (http://www.driemollen.com), J.J. Darboven Kaffee (http://www.darboven.com), and
Autobar (also specialised in vending machine coffee http://www.autobar.nl). There are also
certified roasters that sell coffee under their own brand. Among the best known in Europe are
Café Direct, England (http://www.cafedirect.co.uk), Simon Levelt, The Netherlands
(http://www.simonlevelt.nl), Rapunzel and Lebensbaum, Germany
(http://www.lebensbaum.de), Käfer (http://www.kaefer-produkte.de) or under the umbrella of
the Fair-Trade label, such as Gepa, Fair Trade original, Solidar Monde
(http://www.solidarmonde.fr), Fairglobe (http://www.lidl-fairglobe.de) - the Fair Trade brand
of the German discounter Lidl, or CTM Altromercato (http://www.altromercato.it). In the EU,
CIMS has identified around 100 certified coffee importers, 80 for organic, 70 for FairTrade, 19
for Utz Certified, 12 for Rainforest Alliance and 1 for Bird Friendly, including double counts.
Most are located in The Netherlands and Germany and are companies dedicated to reexporting to other countries such as Scandinavia, Switzerland, and Italy. The UK also has a
number of major importers, but they are oriented towards local consumption.
The Intelligence Centre on Sustainable Markets (CIMS) identified around 250 roasters in
Europe which offer some sort of sustainable certified coffee. Two-thirds offer Fair-Trade coffee
and half offer organic coffee. There are 23 roasters registered with Rainforest Alliance, 12 with
Utz Certified and 1 with Bird Friendly.
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In Europe, certified coffee (i.e., organic, FairTrade, Utz Certified, Rainforest Alliance, etc.),
mostly does not belong to the specialty coffee sector and is sold primarily through traditional
channels (either mainstream retailers or organic retailers).
Tea
Germany and the UK are the most important markets in the EU for organic tea. The UK is also
by far the most important market for Fair Trade tea, accounting for 70% of the 3,900 tonne
global market in 2006 (FLO international 2007). Major organic importers/traders/blenders such
as Clipper Teas (http://www.clipper-teas.com), Whistbray, Hampstead Tea
(http://www.hampsteadtea.com), Dragonfly Teas (http://www.dragonflyteas.com), Qi Herbal
Health (http://www.qi-teas.com) (all UK), Oasis (http://www.oasistee.de), Lebensbaum
(http://www.lebensbaum.de), Kloth & Köhnken (http://www.kktee.de) (all Germany) are also
located in these countries. Major organics trading houses, which also carry tea in their product
assortment, are more often located in The Netherlands and Germany and have been
mentioned above.
Major tea importers such as Unilever, Van Rees, James Finlay and Tetley/Stansand are active
on the conventional market. Premium tea producers in the United Kingdom, such as Twinings
London, also have organic lines, also specifically for the catering and institutional markets.
Organic and/or Fair Trade tea is relatively broadly carried in supermarket assortments in the
United Kingdom, but less often in Germany or other European countries. In the latter, the bulk
of organic tea is sold via organic shops or health food stores.
Therefore, the German and British market will be of special interest. However, another
interesting company, De Drie Mollen, a coffee and tea processor also producing organic and
Fair Trade tea, is located in The Netherlands. Simon Levelt and Algra Mocca d'Or
(http://www.algrakoffie.nl), another organic/Fair Trade certified tea and coffee producer is also
located in The Netherlands. Relevant companies can be found in the CBI market surveys
covering the (organic) coffee, tea and cocoa market in individual EU countries.
In many EU countries, the focus within the tea market is more on Fair Trade than on organic
teas, and the number of supermarkets carrying organic tea is far more limited. In general,
private labels are of less importance in the organic tea market than in the organic coffee
market. For example, both Super de Boer and Albert Heijn in The Netherlands have only one
type of organic tea, which is also Fair Trade certified.
Cocoa
Specialized cocoa traders play a limited role in the organic cocoa market, but in interviews with
industry sources it was found that large traders of cocoa are also examining the possibilities of
entering the organic market and are looking for suppliers of cocoa beans, paste and butter.
Demand for organic cocoa powder was not indicated. However, many processing companies
will source their products through specialised organics traders.
Cocoa processors will usually be involved on request of end-users (Dutch Cocoa, Nederland SA
- http://www.dutchcocoa.com - in Spain), or they are part of integrated chocolate companies
which also have organic lines (ICAM - http://www.icamcioccolato.it -, Barry Callebaut and
Debelis - http://www.puratos.com ). However, ADM also indicated looking for organic suppliers
while certifying part of their facilities for organic production. These integrated industrial
chocolate manufacturers and processors currently import most of the cocoa not actually
imported by importers. These companies are looking for organic cocoa beans as well as
processed cocoa products. Part of the organic cocoa is processed at the point of origin, with
certified processing plants being available in, amongst others, Bolivia, Peru and the Dominican
Republic.
Currently, there is only one major consumer chocolate manufacturer involved in the organic
chocolate market (Barry Callebaut), as well as several up-market retailers. Important
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specialized brands and manufacturers include Green & Black’s
(http://www.greenandblacks.com/uk), Vivani (http://www.vivani.de, produced by Weinrich &
Co (http://www.weinrich-schokolade.de) and Mascao (produced by Bernrain AG
(http://www.swisschocolate.ch). Other major chocolate manufacturers are becoming involved
in the market, either by starting organic lines, or buying specialised organic chocolate (in the
case of Cadbury buying Green & Black’s). Only rarely do chocolate manufacturers source cocoa
products directly in production countries, and then only when it concerns company-owned local
processing facilities.
Some major European companies involved in processing of Fair-Trade cocoa are Daarnhouwer
& Co. and Dutch Cocoa BV (Holland). Two prominent companies which manufacture (not
process) Fair-Trade and organic chocolate are Chocolat Bernrain (Switzerland), which produces
conventional, organic, and Fair-Trade chocolate, and Weinrich & Co. (Germany), a chocolate
manufacturer producing both organic and Fair-Trade products. Rapunzel and Gepa only
produce organic/Fair-Trade chocolate.
3.2
Price structure
The margins charged by different intermediaries in the coffee, tea and cocoa trade are
influenced by many different factors. These include the type of commodity, quality, the current
and expected future harvest situation, the availability or number of sources for the particular
commodity, the level of demand and the trend in prices. All these factors make it extremely
difficult to provide information on typical margins in the trade of these three commodities.
As an example of how prices fluctuate along the supply chain, we will use the variation on
black tea prices:
Production costs
Tea plantation: cultivation, harvesting, fertilizing, weeding, pruning, other
Processing: sorting, withering, breaking up, fermentation, drying, sifting, packing
Total: € 1.25/kg FOB (of which € 0.51/kg is labourer’s wage)
Auction: € 1.63/kg FOB
Transportation costs
Export-tax, harbour costs, transport
Total: € 2.47/kg FOB
Manufacturing costs
Marketing, re-packing, tea bagging, transport 2x, warehousing
Total: € 8.51/kg
Supermarket: € 18.10/kg (including 6% VAT)
From this figure it becomes clear that the largest margins can be found at the final stages of
the value chain, when an ingredient is manufactured into a final product.
It is essential that producers and exporters focus on their area of expertise and keep
themselves informed on costs of production and returns on investment, clearly identifying the
value added systems and possibilities of competitive advantage. They should also be aware of
what competitors are doing.
Opportunities for suppliers to move up the supply chain require an analysis of the whole
system. Suppliers should understand the value of the product offered by the downstream
supplier and the risks of supplying that particular product. Suppliers should also decide on
whether the upstream company can make appropriate investments and compete effectively
with the downstream company.
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Regarding organic coffee, tea and cocoa, there is a price mark-up attached to the product,
which is also paid to the exporter. As the organically certified products may be traded in
relatively smaller quantities, there can be an additional cost incurred by the importer.
3.3
Useful sources
Coffee
• A great deal of information on the coffee trade can be found in ITC’s “Coffee: An Exporter’s
guide”. The study can be ordered at:
http://www.intracen.org/eshop/f_e_IP_Title.Asp?ID=26556&LN=EN. Finding companies
active in the coffee trade is easiest through the links page of the International Coffee
Organisation: http://www.ico.org/coffee_authorities.asp
• The European Coffee Federation also shows its national association members and company
members at http://www.ecf-coffee.org
• Both the national member sites are most useful for finding additional companies active in
the trade. For example, at http://www.kaffeeverband.de/25.htm, the German Coffee
Association Germany’s coffee companies are arranged according to their position in their
activities.
• ICCO’s 2002 report on Organic Coffee, Cocoa and Tea provides information on major
players in the organic market for all three products discussed. This survey can be found at:
http://www.sippo.ch/cgi/news/publications.asp?mode=6#org2
• The Tea and Coffee Trade Journal: http://www.teaandcoffee.net
Tea
• Inttea’s annual bulletin of statistics also contains a very useful trade directory in which the
most important companies in producing and consumption countries can be encountered.
This publication can be ordered at http://www.inttea.com/publications.asp
• Furthermore at the website of the European Tea Committee (ETC): http://www.etconline.org/member.html#a you can find national member organisations to which you
should refer to encounter other companies active in the tea trade.
• The UK Tea Council also offers business contacts specified by trade channel at:
http://www.tea.co.uk/businessdirectory.php?mode=alpha&let=D
Cocoa
• “Cocoa: A Guide to Trade Practices” is a very comprehensive information source for the
cocoa trade. The study can be ordered at:
http://www.intracen.org/eshop/f_e_IP_Title.Asp?ID=9602&LN=EN.
• Companies active in the cocoa trade can be encountered at the following websites.
o http://www.cocoafederation.com/membership/members.jsp
o http://www.worldcocoafoundation.org/about/member-companies.asp
o http://www.eurococoa.com
• Far more comprehensive is ICCO’s World Cocoa Directory, which can be ordered at
http://www.ICCO.org/documents/publications.aspx € 127.50 or £ 85.
On-line company databases for finding companies working in the coffee, tea and cocoa
markets are firstly national associations for the appropriate products, which are mentioned in
Section 6 of the surveys covering EU countries. Others include:
• Food world: http://www.thefoodworld.com (an extensive online food business directory,
with full EU coverage. Coffee, tea and cocoa are a separate product group.)
• Europages (except for coffee and tea): http://www.europages.com (online business
directory, with full EU coverage. Cocoa and chocolate, with coffee and tea being two
separate product groups)
Business-to-business sources include the following;
• Agronetwork.com: http://www.agronetwork.com/global (coffee and tea are included under
food)
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•
IngridNet: http://www.ingridnet.com (a marketing instrument for companies supplying
ingredients to, among others, food industries. Cocoa and cocoa products, and tea and
coffee products are two separate product groups).
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CBI MARKET SURVEY:
4
TRADE: IMPORTS AND EXPORTS
4.1
Coffee
Total EU imports
Between 2002 and 2006, imports of coffee increased by 14% annually in value (Poland was
not included in the figures for 2002; otherwise, this increase would have been slightly higher),
and an increase of 3% in volume, amounting to € 6.3 billion / 3.3 million tonnes in 2006.
Imports in volume showed a slight increase in the review period, whereas all major EU
importers showed a significant increase in imports in terms of value. Among the major
importers, only Germany showed an increase in imports exceeding the annual average growth
in EU imports. France, Italy, Belgium, Spain and The Netherlands showed an increase which
equalled or remained slightly below the EU average. Imports by new EU countries, especially
Romania and Bulgaria, also showed an increase which exceeded the EU growth in imports.
Imports are mostly sourced directly in developing countries. Imports from developing countries
account for 67% of total imports in value and 80% in volume, whereas intra-EU imports
account for 30% of the total value and 20% of the volume. In spite of the increase in imports
from developing countries, the role of several European countries in the trade of coffee is
increasing. In 2002, developing countries accounted for 71% of total imports in value, while
intra-EU imports accounted for 27%. This indicates that the market share of imports from
developing countries has decreased over the review period. Germany and Belgium are
particularly important re-exporters.
Table 4.1 EU imports of coffee
2002/2006, € million/ 1,000 tonnes
2002
value
Total EU, of which
3,751
from
Intra-EU
1,018
Extra-EU ex. DC*
56
DC*
2,677
Source: Eurostat (2007)
2004
volume
2,915
420
12
2,484
value
2006
volume
4,066
1,287
81
2,698
3,199
553
16
2,630
value
6.283
1,915
132
4,235
volume
3,335
652
16
2.667
Average
annual %
change in
value
14%
17%
24%
12%
*Developing countries
Global coffee prices have a strong influence on the imports into the European Union with
regard to value. This can also be discerned in Table 4.1. However, this relationship is not
completely straightforward, especially on a country level. This could be due to the variety in
composition of imports into the EU and separate EU countries (Robusta, Arabica, milds) or the
level of processing (roasted, unroasted, decaffeinated). For more information on coffee prices,
please refer to Chapter 9 of this survey.
Organic
Coffee is one of the organic products most exported by developing countries. It is mainly
sourced in Latin America, but increasingly also in other continents. The leading importers of
organic coffee are Germany, Belgium/Luxembourg, The Netherlands, France, the UK and
Sweden. These countries are also important processors and re-exporters. Please note that the
data provided in Chapter 1 gives a much higher consumption of organic coffee.
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CBI MARKET SURVEY:
Table 4.2
EU-imports/DC exports of organic coffee 2005, tonnes, excluding Peru*
Total per
importer
Papua
New
Guinea
Nicaragua
Mexico
Honduras
Ethiopia
El
Salvador
Domican
Republic
Colombia
Brazil
Bolivia
Belgium/Lux.
19.3
0.0
99.1
26.1
75.9 1,045.2
71.1
100.1
36.6
0.0 1,473.4
Denmark
0.0
0.0
0.0
0.0
0.0
0.0
0.0
177.7
11.0
0.0
188.7
Finland
0.0
0.0
19.3
0.0
0.0
108.0
0.0
0.0
0.0
0.0
127.3
France
78.4
0.0
5.0
0.0
0.0
612.0
0.0
159.4
0.0
0.0
854.8
Germany
184.3
76.8
52.6 130.8
25.9 2,638.6 227.7
758.3 161.6 139.2 4,395.8
Greece
0.0
96.0
0.0
0.0
0.0
0.0
0.0
0.0
0.0
0.0
96.0
Italy
0.0
0.0
0.0
0.0
0.0
72.0 155.3
25.6
5.5
0.0
258.4
Netherlands
117.7
0.0
62.9
0.0
0.0
458.5
38.6
134.9
0.0
8.5
821.1
Spain
0.0
0.0
61.9
0.0
0.0
144.0
4.1
0.0
63.8
0.0
273.8
Sweden
0.0 108.0
29.7
0.0
0.0
272.4
0.0
226.0
33.8
0.0
669.9
United
Kingdom
0.0
4.8
85.1
0.0
0.3
433.7
41.0
0.0
56.9
54.0
675.9
EU per
399.7 285.6 415.7 156.9 102.1 5,784.4 537.8 1,581.9 369.4 201.7 9,835.2
supplier
Source: ICO 2007
* Please note that these figures are likely to be substantially underestimated. Due to inconsistent data
from Peru, one of the principal organic coffee producers, and according to its national organisation, the
world’s biggest, data was not included by ISO. The Peruvian national organisation indicated exports of
24,000 tonnes. If the same percentage of Peruvian coffee would go to the EU as coffee from other
countries, EU organic coffee imports could amount to around 18,000 tonnes. Moreover, not all production
countries and not all EU countries are included.
EU imports per product group
Green coffee
Between 2002 and 2006, imports of green coffee increased by 12% annually in value, and
decreased 0.2% in volume, amounting to € 4.6 billion / 2.9 million tonnes in the latter year.
Imports into Germany (+15% annually), Italy (+13%) and Belgium (+6%) have shown
particularly significant annual increases. The main EU importers are Germany (35% of total
imports), Italy (14%), Belgium (7.9%), France (7.6%) and Spain (7.2%).
Green coffee is mostly imported directly from developing countries. However, several EU
countries, such as Belgium and particularly Germany, play a role in the re-export of this
product. Imports of green coffee into these countries have increased, as have their exports.
The market share of developing countries in total imports decreased somewhat in the review.
All major suppliers of green coffee showed significant increases in their exports to the EU in
the review period, where average annual growth varied between 6% for Guatemala and 27%
for Vietnam.
Decaffeinated green coffee accounts for only 1.6% of total green coffee imports. In 2006,
imports amounted to € 76 million / 35 thousand tonnes, signifying an annual increase of 7% in
value and a slight decrease of 1% in volume between 2001 and 2005. Decaffeinated coffee is
almost exclusively supplied by Germany.
Roasted coffee
Imports of roasted coffee amounted to € 1.6 billion / 438 thousand tonnes in 2006. This
signifies an annual increase of 18% in value and of 15% in volume between 2002 and 2006.
The main importers are France (23% of total imports value), Germany (13%) and the United
Kingdom (8%).
As roasting of coffee predominately takes place in EU countries, their share of EU imports of
roasted coffee is very high. Moreover, EU countries, along with Switzerland, are further
increasing their share in the supplies of this product group. Brazil is the only developing
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CBI MARKET SURVEY:
country with a (very limited) foothold in the EU market for roasted coffee. During the review
period, imports from this country achieved an annual increase of 7% in value.
Table 4.3
EU imports and leading suppliers of coffee
2002-2006, share in % of value
Product
Total EU,
of which from
Intra-EU
Extra-EU
ex. DC*
DC*
Coffee
Total EU,
of which from
Intra-EU
Extra-EU
ex. DC*
DC*
Green
coffee
Total EU,
of which from
Intra-EU
Roasted
coffee
2002
€ mln
2004
€ mln
2006
€ mln
3,751
4,066
6,283
1,018
1,287
56
81
Leading suppliers in 2006
(share in %)
Germany (11), Italy (5.0), Belgium (4.8),
1,915 The Netherlands (2.4), Austria (1.3),
France (1.2)
Switzerland (1.9)
132
2,677
2,698
Brazil (21), Vietnam (9.0), Colombia (8),
Peru (3.8), Honduras (3.7), Indonesia
4,235 (2.6), India (2.6), Ethiopia (2.4),
Guatemala (2.0), Uganda (1.5), Kenya
(1.3), El Salvador (1.2), Nicaragua (1.1)
2,916
2,979
4,642
241
280
408
12
12
11
2,663
2,686
835
1,087
777
1,006
Germany (4.8), Belgium (1.6)
Brazil (28), Vietnam (12) Colombia (11),
Peru (5.0), Honduras (5.0), India (3.5),
4,222 Guatemala (2.7), Uganda (2.0), Kenya
(1.8), El Salvador (1.7), Nicaragua (1.4),
Costa Rica (1.4), Papua New Guinea (1.0)
Share
(%)
30
3
67
8.8
0.2
91
1,641
Germany (29), Italy (19), Belgium (14),
The Netherlands (7.2), Austria (4.9),
Sweden (2.8), Czech Rep. (2.0), Poland
1,507
(2.0), France (1.9), Finland (1.6), Spain
(1.5), United Kingdom (1.1), Denmark
(1.1), Portugal (1.0), Ireland (0.7)
Switzerland (7.2), USA (0.1)
121
91.9
Extra-EU
43
68
7.4
ex. DC*
DC*
14
12
12
Brazil (0.3), Colombia (0.1)
0.7
Please note that as Poland only supplied data on HS 4 digit level in 2002, the total of the products does
not match the product group.
4.2
Tea
Total EU imports
Imports of tea into the EU decreased between 2002 and 2006. They decreased by 1% in value
annually, but imported volumes remained more or less stable, amounting to € 801 million /
336 thousand tonnes in 2006. This shows an overall decrease in import price but, as explained
in the CBI surveys covering the market for the individual EU member countries, this trend is
not universal across the EU.
A significant part of the decrease in value in the review period is due to diminishing imports by
the United Kingdom (an annual decrease of 3%), traditionally the largest market for tea and a
country with an important trade function for tea. Germany and France (the second and third
EU markets) showed an increase in imports, although only by 2% and 1% annually,
respectively. The Netherlands and Poland (the fourth and fifth EU markets), on the other hand,
showed a decrease of 1% and 2%, respectively, in the review period. Out of the remaining 22
EU countries, very few increased their imports of tea (in value) between 2002 and 2006,
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CBI MARKET SURVEY:
although a high increase of imports is observed in the newest accession countries: Romania
(+21%) and Bulgaria (+47%).
When import volumes are considered, the division of imports into the EU has slightly shifted. A
number of countries located in Southern, Central and Eastern Europe with a relatively small
consumption (e.g. Portugal, Hungary, Romania and, to a lesser extent, Italy) were importing
much greater quantities in 2006 as compared to 2002. It should be noted, however, that Spain
does not correspond to this regional trend.
Table 4.4 EU imports of tea
2002-2006, € million, 1,000 tonnes
2002
value
Total EU, of which
from
Intra-EU
Extra EU ex. DC*
DC*
826
279
24
523
2004
volume
334
57
4
273
value
2006
volume
725
269
27
429
327
55
7
265
value
801
285
26
490
volume
336
61
6
269
Average
annual %
change in
value
-1%
0.5%
2%
-2%
Organic
The volume of organic tea traded on the global market has increased substantially over the
last few years, as tea farmers have become more aware of environmental problems and severe
health hazards, also because the demand for organic tea continues to increase. The main
producers of organic tea are India (about 60% of global organic and in-conversion tea area)
and China (about a quarter). Other developing countries with (very marginal) production of
organic tea are Sri Lanka, Tanzania, Vietnam, Bolivia, Argentina and Indonesia. As there is
little or no domestic demand for organic tea, the tea is mostly exported to western countries.
Leading destinations in Europe are Germany and the UK.
Black tea
Between 2002 and 2006, imports of black tea decreased by 2.0% in value. In volume,
however, imports of tea remained mostly stable, illustrating an overall decrease in import unit
value of black tea. In 2006, imports amounted to € 669 million / 298 thousand tonnes. The
five main importers of black tea in the EU are the United Kingdom (38% of imports), Germany
(13%), France (9.3%), The Netherlands (7.8%) and Poland (6.6%). Imports into these
countries decreased considerably both in value and volume between 2002 and 2006, an
exception being The Netherlands, which shows increase both in value and in volume. Imports
by the UK deceased the most in the review period (-4% in value).
Similar to the total EU imports of tea, imports of black tea only increased in volume and value
in a number of South, Central and East European countries where a relatively small
consumption is observed (although exceptions to this trend are more common for this product
group). Slovenia, the smallest consumer of black tea in the EU, had an imports increase of
16% in value and 15% in volume. Another example is Romania, whose imports increased by
19% in value and 39% in volume. Exceptions include Bulgaria, which shows a strong increase
of 42% in value, but a decrease of 5% in volume; Portugal shows an increase of 8% in value,
but a decrease of 2% in volume.
As shown in table 4.5, developing countries account for a considerable share in EU imports of
black tea. Developing countries’ imports share increased steadily in the review period and, in
2006, it amounted to € 429 million, corresponding to a 64% import share. The leading
developing country supplier, Kenya, saw its exports decrease by 2% between 2002 and 2006.
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CBI MARKET SURVEY:
India (the second major supplier), on the other hand, saw a slight increase of 1%. Among
other leading suppliers from developing countries, only China (+5), Argentina (+16%),
Tanzania (+11%) and Vietnam (+14%) experienced substantial annual increases in their
exports of black tea to the EU in the review period.
Table 4.5
EU imports and leading suppliers of tea to the EU
2002 - 2006, share in % of value
Product
Total EU,
of which from
Intra-EU
Tea
Extra-EU
ex. DC*
DC*
Total EU,
of which from
Intra-EU
Extra-EU
ex. DC*
Black tea
DC*
Total EU,
of which from
Intra-EU
Green
tea
Extra-EU
ex. DC*
DC*
2002
€ mln
2004
€ mln
2006
€ mln
826
725
801
279
269
24
27
(share in %)
United Kingdom (11), Germany (8.3),
285 Belgium (4.1), France (2.6), The
Netherlands (2.6), Poland (2.4)
UAE (1.1), Japan (0.6), USA (0.5)
26
523
429
Kenya (18), India (12), China (9.4), Sri
Lanka (8.2), Indonesia (4.7), Malawi (1.8),
490
Argentina (1.6), Vietnam (1.5), Tanzania
(1.1)
678
623
669
229
220
17
20
United Kingdom (11), Germany (6.9),
223 Belgium (4.5), Poland (2.5), The
Netherlands (2.5), France (2.1)
UAE (1.2), USA (0.4), Singapore (0.2)
17
432
383
Kenya (21), India (13), Sri Lanka (9.2),
Indonesia (5.2), China (4.5), Malawi (2.1),
429
Argentina (1.9), Tanzania (1.3), Vietnam
(1.3), Zimbabwe (0.9)
96
102
132
47
49
6
7
43
46
Germany (16), United Kingdom (11),
62 France (5.4), The Netherlands (3.1),
Belgium (2.2)
Japan (3.6), USA (1.1), UAE (0.8)
9
China (34), Sri Lanka (3.1), India (2.4),
61 Vietnam (2.2), Indonesia (2.1), Morocco
(0.7)
Share
(%)
35.6
3.2
61.2
33.3
64.2
2.5
47
6.7
46.3
Green tea
While imports of black tea decreased slightly between 2002 and 2006, imports of green tea
increased by 8% in value and 9% in volume annually in the same period, amounting to € 132
million / 38 thousand tonnes in 2006. 1 ton of green tea is much cheaper than 1 ton black tea,
which is plausible as the production of black tea requires more processing.
The five main EU importers of green tea are France (with a 23% imports share), Germany
(22%), the United Kingdom (8.5%), Belgium (6.6%) and Italy (6.4%). We can observe that
these leading importers of green tea are mostly the leading importers of black tea as well;
nonetheless, their order of importance in the EU imports differs. The UK only accounts for a
relatively small share of EU imports of green tea as the British are traditionally black tea
drinkers. Imports by the leading importers, France and Germany, increased strongly, by 5%,
13% and 12%, respectively. The UK and Italy also showed a significant annual increase in
Page 38 of 63
CBI MARKET SURVEY:
imports, at respectively 12% and 16%. On the other hand, imports by Belgium decreased
slightly and imports by The Netherlands decreased substantially (13% annually).
Imports from developing countries increased by 9% in value, amounting to € 61 million,
corresponding to a 46% imports share. All major suppliers from developing countries
experienced positive growth in their exports to the EU, of which Vietnam (+24% annual
increase) and Sri Lanka (+13% annually) are good examples.
4.3
Cocoa
Total EU imports
Table 4.6 and 4.7 show the imports of cocoa beans and three processed cocoa products, cocoa
paste, butter and powder, in which developing countries play a significant role.
We can observe that imports of all cocoa products, with the exception of cocoa butter,
decreased in value between 2002 and 2006. When expressed in volume, however, imports
have increased, indicating an overall decrease in import prices of cocoa products in the EU
between 2002 and 2006. Imports increased by 5% in volume for cocoa beans, and an increase
of 4% for cocoa paste, cocoa butter and cocoa powder between 2002 and 2006. In terms of
volume, therefore, we can observe a greater increase of imports of unprocessed cocoa beans
compared to processed cocoa products.
Table 4.6 EU imports of cocoa products
2002-2006, € million/ 1,000 tonnes
Product
Cocoa
beans
2002
value
volume
Total EU, of
which from
Intra-EU
Extra-EU ex. DC*
DC*
Total EU, of
which from
Cocoa
Intra-EU
paste
Extra-EU ex. DC*
DC*
Total EU, of
which from
Cocoa
Intra-EU
butter
Extra-EU ex. DC*
DC*
Total EU, of
which from
Cocoa
Intra-EU
powder
Extra-EU ex. DC*
DC*
Source: Eurostat 2007
2004
value volume
Average
2006
value volume annual %
change in
value
2,210
1,276
2,141
1,492
2,066
1,537
-2%
297
164
298
214
262
203
-3%
3
2
1
1
6
4
20%
1,910
1,110
1,841
1,277
1,798
1,329
-2%
662
339
2
321
303
140
1
162
610
299
1
310
317
145
0.3
172
565
312
1
252
353
166
0.4
186
-4%
-2%
-11%
-6%
970
641
20
309
338
220
7
110
1,042
671
3
368
364
229
1
134
1,317
860
2
455
400
252
0.5
147
8%
8%
-46%
10%
361
309
5
47
190
162
2
26
471
408
2
61
212
173
0.5
38
294
265
1
27
220
189
2
30
-5%
-4%
-25%
-13%
Although the figures concern cocoa products of different stages of processing, it is valuable to
add the four products together so as to gain an overall image of the major European cocoa
markets and trends therein. The Netherlands, Germany, Belgium and France are the leading
importers of cocoa beans and derivate products. Imports into Germany and Belgium grow
faster than the overall imports into the EU, which indicates that they are further increasing
their importance as importers. The Netherlands and France, on the other hand, show declining
figures which lie below the EU average, indicating their declining importance as importers. The
United Kingdom and Italy also play a role for some product groups, but they are both
Page 39 of 63
CBI MARKET SURVEY:
decreasing in importance as importers as well. No regional development trends can be
discerned.
Organic cocoa
As markets for organic products in developing countries are still limited, the majority of the
production of organic cocoa is exported to western countries. Imports of organic cocoa into
Europe were estimated to measure 14,000 tons of cocoa bean equivalents in 2003, of which an
estimated 2,000 tons was re-exported to the USA. European importers deal with most of the
organic cocoa bean processing and trading (Ecomercados2, 2005). Germany and The
Netherlands are the leading importers of organic cocoa, of which most is re-exported by the
Netherlands. Other important importers were France and Italy (importing partly from
Germany). Spain, Belgium and the UK were small importers. There is only a very limited
number of importers in Europe.
Cocoa beans
Between 2002 and 2006, imports of cocoa beans decreased by 2% annually, amounting to
€ 2.1 billion. At the same time, imports in terms of volume increased by an annual average of
5%. This indicates an overall decrease in prices of cocoa beans in the review period.
The most important EU importers of cocoa beans are The Netherlands, accounting for 34% of
total EU imports, followed by Germany (19%), Belgium (14%), France (11%) and the United
Kingdom (8.7%). The lion’s share of cocoa beans is imported from Ivory Coast and Ghana.
Other countries, such as Nigeria and Cameroon, also play an important role. Considering the
fact that cocoa production does not take place in Europe, the import share of EU countries
such as Belgium, the UK and particularly The Netherlands consists entirely of re-exports of
beans originating in developing countries.
Cocoa paste
A similar development observed for cocoa beans can be found for cocoa paste. Between 2002
and 2006, imports decreased in terms of value (-4% annually), whereas imports in terms of
volume increased (+4% annually). Imports amounted to € 565 million / 353 thousand tonnes
in 2006. The most important importer of cocoa paste is France (26%), followed by The
Netherlands (15%), Germany (14%), Belgium (14%) and Poland (10%).
EU countries play a far larger role in the supply of cocoa paste than for cocoa beans. A large
share of the processing of cocoa products (paste/liquor, butter/powder) takes place in the EU,
especially in The Netherlands. The country is the second largest supplier of cocoa paste to the
EU, following Ivory Coast, the leading supplier. However, The Netherlands is also, jointly with
France, the principal importer of cocoa paste from developing countries, accounting for almost
a third of developing country imports. It is likely that part of the exports of these countries
also consists of re-exports of paste produced in developing countries.
Cocoa butter
Among the cocoa products investigated in this survey, cocoa butter is the only one which
showed an annual increase of imports in terms of both value and volume. Imports increased
by an annual average of 8% in value between 2002 and 2006, whereas an annual increase of
4% is observed when imports are considered in terms of volume. These figures reflect an
increase in the average price of cocoa butter in the review period. In 2006, imports of cocoa
butter amounted to € 1.3 billion/ 400 thousand tonnes. The major importers of cocoa butter in
the EU are: Germany (21% of EU imports), Belgium (18%), France (16%), The Netherlands
(14%) and the United Kingdom (11%).
2
For more information, see Appendix D.
Page 40 of 63
CBI MARKET SURVEY:
Similar to cocoa paste, the role of EU countries in the supply of cocoa butter is very large
(intra-EU supplies account for 65% of total supplies). In fact, the leading supplier of cocoa
butter is The Netherlands, which supplies 43% of the cocoa butter imported by the EU. Among
the leading suppliers, The Netherlands is followed at distance by France (13%), Ivory Coast
(12%) and Malaysia (7%). As in the case of cocoa paste, some of the leading suppliers of
cocoa butter are also large importers of this product, which possibly indicates that these
countries re-export cocoa butter imported from developing countries.
Cocoa powder
The development observed for cocoa beans and cocoa paste was even more pronounced for
cocoa powder. Whereas an annual decrease of 5% in import value was observed between 2002
and 2006, a 4% volume increase was observed in the same period. This hides some very
profound development during the review period reflecting price shifts. Between 2002 and 2004
the value of cocoa powder imports increased by 7%, but dropped by 11% between 2004 and
2006. In 2006, imports of cocoa powder amounted to € 294 million / 220 thousand tonnes.
The leading EU importers are Germany (18%), France (14%), The Netherlands (11%), Italy
(11%) and the United Kingdom (10%).
The proportion of cocoa powder originating in other EU countries is even higher than for cocoa
paste and cocoa butter, amounting to 90% of total EU imports. Production of powder mostly
takes place within the EU. The Netherlands alone supplies half of total EU imports. France,
Spain, Germany and the United Kingdom, play a smaller role. Imports from developing
countries are decreasing at higher rates than overall imports.
Table 4.7
EU imports and leading suppliers of cocoa products
2002-2006, share in % of value
Product
Total EU,
of which from
Intra-EU
Cocoa
beans
Extra-EU
ex. DC*
DC*
Total EU,
of which from
Intra-EU
Cocoa
paste
Extra-EU
ex. DC*
DC*
Total EU,
of which from
Intra-EU
Cocoa
butter
Extra-EU
ex. DC*
DC*
2002
€ mln
2004
€ mln
2006
€ mln
2,210
2,141
2,066
297
298
262
3
1
6
1,910
1,841
1,798
663
610
565
339
299
312
2
1
1
321
310
252
970
1,042
1,317
641
671
860
20
3
2
309
368
455
(share in %)
The Netherlands (7.0), Belgium (3.0),
United Kingdom (1.1), France (0.9)
USA (0.2)
Ivory Coast (31), Ghana (26), Nigeria
(10), Cameroon (8.0), Togo (4.0),
Ecuador (2.5), Dominican Republic
(1.0), Guinea (0.9), Sierra Leone (0.6),
Papua New Guinea (0.6)
The Netherlands (29), France (9.4),
Germany (9.3), Belgium (2.0), Slovakia
(1.6), United Kingdom (1.3)
Switzerland (0.1), USA (0.1)
Ivory Coast (32), Ghana (6.0),
Cameroon (2.8), Indonesia (1.7),
Malaysia (0.7), Nigeria (0.7)
The Netherlands (43), France (13),
United Kingdom (2.4), Belgium (2.1),
Germany (1.8), Spain (1.4)
Singapore (0.1)
Ivory Coast (12), Malaysia (7.0),
Indonesia (4.0), Nigeria (2.4), Ghana
(2.3), China (1.4), Thailand (1.1), Peru
(1.1)
Share
(%)
12.7
0.3
87
55.2
0.2
44.6
65.3
0.1
34.6
Page 41 of 63
CBI MARKET SURVEY:
Product
Total EU,
of which from
Intra-EU
Cocoa
powder
Extra-EU
ex. DC*
DC*
2002
€ mln
2004
€ mln
2006
€ mln
361
471
294
309
408
265
5
2
1
47
61
27
(share in %)
The Netherlands (50), France (11),
Germany (9.1), Spain (5.2), United
Kingdom (4.6), Italy (3.1)
Japan (0.3), Russia (0.1)
Ivory Coast (5.6), Malaysia (1.4), Brazil
(1.0), Turkey (0.6)
Share
(%)
90
1
9
4.4
The role of the developing countries in imports per product group
Coffee
Since there is no EU production of coffee, the EU is completely dependent on developing
countries for its supply. Among developing countries, Vietnam is rapidly increasing in
importance. Re-exports of green coffee also play an increasingly important role in EU trade of
coffee. Therefore, the main EU importing countries are not necessarily the main coffee
consuming nations, but can also be countries that play a large role in the re-export of coffee.
Germany now accounts for 30% of total EU imports and, in turn, supplies 11% of EU imports.
Please refer to table 4.3 for an overview of suppliers to the EU.
Developing countries play no significant role in the supply of roasted coffee, as roasting
predominately takes place in the consuming (EU) countries.
Table 4.8 Imports of green and roasted coffee from developing countries
2002 – 2006, € million/ 1,000 tonnes
2002
value volume
2004
value Volume
Average annual %
2006
value
volume change in value
Total EU
2,677
2,484
2,698
2,630
4,235
2,667
12%
Germany
951
855
979
952
1629
994
14%
Italy
381
358
380
385
630
415
13%
Belgium
188
161
185
163
309
186
13%
Spain
173
205
183
215
299
222
15%
France
250
254
195
196
275
176
2%
The Netherlands
156
117
172
135
246
138
12%
Sweden
118
85
114
89
200
108
14%
United Kingdom
112
108
123
115
168
108
11%
Finland
78
60
80
63
125
64
12%
Poland*
n.a.
n.a.
54
78
74
60
8%
Portugal
38
36
40
38
58
39
11%
Denmark
65
55
57
51
55
31
-4%
Romania
31
35
33
34
40
29
7%
Greece
23
27
27
27
31
23
7%
Austria
21
17
20
18
24
14
3%
Czech Republic
20
27
13
16
19
12
-1%
Hungary
31
40
17
23
19
14
-11%
Bulgaria
8.8
17
9.4
17
15
19
14%
Slovenia
13
11
8.3
7.2
12
8.0
-1%
Ireland
3.6
1.9
5.0
3.1
5.6
2.5
12%
Cyprus
1.7
1.9
1.6
1.5
2.2
1.6
7%
Slovakia
8.1
9.1
2.1
2.7
1.3
1.0
-37%
Other EU
5.9
2.3
0.5
0.4
0.6
0.4
-44%
Page 42 of 63
CBI MARKET SURVEY:
*the average annual change for Poland comprises the period between 2004 and 2006, since information
is not available for 2002.
Tea
Tea is not grown in the EU, which makes the EU dependent on developing countries for the
supply of tea, besides some exports from the United Arab Emirates, the USA and Japan. More
than 60% of EU tea imports is directly supplied by developing countries, a small share (3.2%)
is derived from extra-EU sources, indicating that the rest consists of re-exports of tea from
developing countries by EU member countries. This share is increasing. Between 2002 and
2006, while total imports decreased, intra-EU imports increased by 2%. Most of this can be
attributed to Germany’s increasing presence, now accounting for 14% of EU imports of tea.
Developing countries lost ground in the EU imports of tea, in particular black tea. Imports from
developing countries decreased by 2% annually, amounting to € 490 million in 2006. The
leading developing country suppliers are Kenya and India. Both lost considerable market share
in EU imports between 2002 and 2006. In addition, their supply showed an annual decrease of
3% and 1%, respectively. Whilst developing countries’ presence in the supply of black tea
slightly decreased between 2002 and 2006, developing countries gained market share in the
supply of green tea. Nevertheless, EU imports of green tea only constitute a minor share of
total EU tea imports.
Table 4.9 Imports of tea from developing countries
2002 - 2006, € million/ 1,000 tonnes
2002
value volume
Total EU
523
United Kingdom
275
Germany
91
The Netherlands
35
Poland
47
France
23.4
Ireland
16.5
Belgium
6.0
Italy
5.6
Lithuania
4.5
Czech Republic
3.0
Sweden
2.0
Denmark
1.8
Latvia
1.5
Finland
1.2
Romania
0.5
Spain
0.4
Greece
1.1
Hungary
2.1
Other EU
4.6
273
160
35
22
31
6.4
7.9
2.3
2.0
1.0
1.1
0.5
0.5
0.5
0.2
0.2
0.1
0.3
1.4
1.5
2004
value volume
429
217
81
29
39
22.4
12.6
5.2
4.7
2.4
2.4
2.1
1.3
1.2
0.9
0.7
0.8
0.7
1.6
3.0
265
150
39
22
30
6.5
6.8
2.2
2.0
0.5
1.0
0.7
0.4
0.5
0.4
0.2
0.6
0.3
1.3
1.2
2006
Average annual %
value Volume change in value
490
242
98
41
38
25.0
15.6
6.5
6.4
2.6
2.3
2.0
1.9
1.4
1.3
1.3
0.9
0.8
0.8
2.8
269
153
42
27
22
6.5
7.5
2.7
2.2
0.4
0.7
0.5
0.5
0.5
0.5
0.7
0.6
0.3
0.1
0.9
-2%
-3%
2%
4%
-5%
2%
-1%
2%
4%
-13%
-7%
0%
1%
-1%
2%
29%
23%
-7%
-22%
-12%
Cocoa
The role of developing countries in the supply of cocoa paste has declined in the past few
years. In 2002, 49% of cocoa paste was sourced in developing countries, while this share
decreased to 45% in 2006. A decline is also observed in the role of developing countries in the
supply of cocoa powder to the European market. In 2002, 13% of imports was supplied by
developing countries but, in 2006, this figure fell to 9%. Not only is this a product group for
which the role of developing countries is already limited; it is also in decline. The role of
developing countries in the supply of both cocoa beans and cocoa butter, on the other hand,
increased. In 2002, developing countries supplied 86% of the cocoa beans to the EU market;
in 2006, this share rose to 87%. As for cocoa butter, the share of developing countries in
imports to the EU rose from 32% in 2002 to 35% in 2006.
Page 43 of 63
CBI MARKET SURVEY:
Some changes occurred in the dominance of certain developing countries in the supply of
cocoa products. Ivory Coast drastically decreased in importance between 2002 and 2006, while
other African countries such as Ghana, Cameroon and Togo gained market share where most
cocoa products are concerned, especially cocoa beans. However, Ivory Coast remains the main
supplier of cocoa beans and cocoa paste. In addition, trade through The Netherlands and
Belgium is increasing, which is indicated by the growing exports of cocoa beans by these
countries. It is also interesting to note that imports from Sierra Leone are increasing at fast
rates again; in the review period, imports of cocoa beans from Sierra Leone increased by 29%.
Table 4.10 Imports of cocoa beans and selected processed cocoa products from
developing countries, 2002 – 2006, € million/ 1,000 tonnes
Product
group
Total EU
Netherlands
Belgium
Germany
Cocoa
UK
beans
France
Spain
Italy
Other EU
Total EU
France
Netherlands
Poland
Cocoa
Spain
paste
Germany
Italy
Bulgaria
Other EU
Total EU
Netherlands
France
UK
Cocoa
Poland
butter
Italy
Germany
Spain
Other EU
Total EU
Netherlands
France
Romania
Cocoa
Poland
powder Belgium
Italy
Hungary
Other EU
4.5
2002
value volume
1,910
807
206
231
233
148
103
91
91
321
120
96
28
63
0.7
0.5
5.2
8.4
309
84
150
39
12
4.6
3.5
7.0
8.5
47
23
4.0
1.8
4.5
3.8
0.3
3.3
6.1
1,110
474
120
146
120
83
56
55
58
162
51
46
12
42
0.3
0.2
5.9
3.8
111
32
52
14
3.8
1.8
1.5
2.4
3.7
26
11
1.8
2.7
2.6
1.6
0.1
2.1
3.5
2004
2006
Average
value volume value
volume annual %
change in
value
1,841
1,277 1,798
1,329
-2%
822
591
703
549
-3%
227
154
279
198
8%
209
129
251
181
2%
184
135
168
121
-8%
173
116
163
115
2%
90
63
94
71
-2%
96
58
92
60
0%
40
31
48
36
-15%
310
172
252
186
-6%
123
67
88
56
-7%
78
41
82
52
-4%
25
14
28
18
0%
63
37
25
43
-21%
9.4
5.1
15
8.8
113%
3.7
2.1
5.2
2.9
80%
3.3
3.0
4.3
4.2
-5%
3.3
1.9
4.2
2.3
-16%
368
134
455
147
10%
140
48
182
59
21%
130
49
149
49
0%
58
22
50
16
6%
15
5.2
26
7.6
21%
7.5
2.5
15
4.4
35%
0.7
0.2
11
3.5
35%
5.2
2.1
7.5
2.5
2%
12
4.6
15
4.6
15%
61
38
28
30
-13%
36
23
14
15
-12%
9.4
4.8
4.2
4.1
1%
2.6
2.2
1.9
1.9
1%
3.4
1.8
1.4
1.7
-25%
3.6
2.1
1.2
1.3
-25%
0.1
0.0
1.0
0.7
38%
2.3
1.4
0.9
1.1
-28%
3.7
2.5
3.1
3.9
-15%
Exports
Coffee
Due to increasing intra-EU trade in coffee, which partly consists of re-exported green coffee
and partly of locally roasted coffee, exports by EU countries showed significant increases
between 2002 and 2006. In the review period, exports of coffee increased by 15% in value
and by 9% in volume.
Page 44 of 63
CBI MARKET SURVEY:
Exports of green coffee increased by 15% in value and by 7% in volume annually, amounting
to € 811 million / 428 thousand tonnes. The most important exporters are Germany (67% of
EU exports) and Belgium (18%). Of EU exports of green coffee, 69% is destined to other EU
countries and 29% to other developed countries, mainly the USA. As the EU does not have
domestic production of coffee, this exclusively concerns re-exports.
Exports of roasted coffee mainly concern exports of coffee which is processed in the EU.
Exports of roasted coffee are increasing faster than exports of green coffee, achieving an
annual increase of 15% in terms of value between 2002 and 2006, and an annual increase of
12% in volume. In 2006, exports amounted to € 1.9 billion / 469 thousand tonnes. The main
exporters are Italy (27%), Germany (23%), and Belgium (13%). More than 80% of roasted
coffee exports is destined to other EU countries, whereas the USA is also an important
destination.
Tea
Total EU tea exports increased by an annual average of 4% in value between 2002 and 2006,
whilst total EU imports decreased by an annual average of -1% in value. As the EU does not
grow tea, this signifies that re-exports increased in importance in the review period.
55% of EU exports finds its way to other EU countries, whereas 45% is exported to extra-EU
countries. The main EU exporter is the UK (41% of EU exports), followed at a distance by
Germany (23%). The EU exports tea to a wide range of different countries; the most important
ones being France (12%), Canada (9%), the USA (6.7%), Italy (5.9%) and Germany (5.1%).
Exports to both the USA and Canada increased very fast.
Exports of black tea increased by 3%, both in terms of value and volume. In 2006, exports of
black tea amounted to € 439 million / 78 thousand tonnes.
EU exports of green tea also increased between 2002 and 2006. The export value increased by
an annual average of 17%, whereas the export volume increased by 16%. In 2006, exports of
green tea amounted to € 107 million / 13.7 thousand tonnes. Clearly, these data signify that
green tea is gaining popularity in Europe at the expense of black tea, as already discussed in
Chapter 4. Consumption is increasing and EU trade in green tea is deepening.
Cocoa
During the review period, exports for all cocoa products, with the exception of cocoa powder,
increased considerably in terms of value. The increase in the exports of cocoa beans, with an
average annual growth of 6%, indicates increasing re-exports of this product. In 2006, cocoa
bean exports amounted to € 388 million / 285 thousand tonnes. Leading EU re-exporters are
The Netherlands and Belgium, together accounting for 95% of total EU exports. Exports are
almost entirely destined to other EU member countries.
Between 2002 and 2006, exports by EU member countries of cocoa paste increased by 3% in
value and by 2% in volume annually, amounting to € 358 million / 188 thousand tonnes in the
latter year. The leading EU exporter is, by far, The Netherlands, accounting for 55% of total EU
exports; this constitutes Dutch production as well as re-exports. More than 75% of the total
export value concerns intra-EU trade, while the remaining part is exported to countries outside
the EU.
Exports of cocoa butter by the EU increased by an annual average of 10% in value and 2% in
volume between 2002 and 2006. In 2006, exports amounted to € 1.1 billion / 327 thousand
tonnes. The Netherlands is the leading exporter of this product in the EU, accounting for 65%
of the exports. The country is followed at a considerable distance by France, which accounts
for 23% of the exports of cocoa butter. This concerns both butter produced in the EU and reexports.
Page 45 of 63
CBI MARKET SURVEY:
In 2006, total EU exports of cocoa powder amounted to € 457 million / 360 thousand tonnes,
representing an average annual decrease of 7% in value, but an increase of 1% in volume
between 2002 and 2006. This particular development indicates a decrease in the export unit
value of cocoa powder. More than half of the exports were destined for other EU member
countries; 46% was exported to countries outside the EU. As the world’s leading producer of
cocoa powder, The Netherlands accounts for 61% of total EU exports.
Table 4.11
Exports of coffee, tea and cocoa by the EU and main exporters
2002-2006, € million / 1,000 tonnes
2002
value
COFFEE
Total EU
1,538
Germany
535
Italy
346
Belgium
202
Austria
64
The Netherlands
42
France
86
Sweden
40
Spain
37
TEA
Total EU
469
United Kingdom
203
Germany
96
Belgium
51
The Netherlands
31
France
37
Poland
16
COCOA BEANS
Total EU
312
Belgium
124
The Netherlands
163
Germany
10
France
8
COCOA PASTE
Total EU
324
The Netherlands
174
Germany
20
France
78
United Kingdom
25
Poland
4
COC. BUTTER
Total EU
763
The Netherlands
497
France
184
Germany
8
Spain
26
United Kingdom
26
Italy
9
COC. POWDER
Total EU
603
The Netherlands
354
France
71
Germany
33
Spain
63
Italy
12
2004
volume
value
2006
volume
value
volume
Av. Annual
Value
change %
632
285
67
115
27
13
39
12
21
1,736
565
401
250
65
83
79
41
44
714
319
78
123
29
24
28
13
27
2,697
970
526
393
156
115
90
81
76
897
417
97
147
53
33
23
24
26
15%
16%
11%
18%
25%
28%
1%
20%
19%
81
30
19
8
12
4
3
477
208
107
41
32
34
20
84
29
22
6
14
3
5
546
222
125
52
40
33
23
92
26
25
7
17
3
5
4%
2%
7%
0.4%
7%
-3%
11%
169
68
87
5
4
434
161
243
8
9
310
115
174
6
5
388
192
175
12
5
285
138
134
8
3
6%
12%
2%
6%
-11%
138
73
8
31
14
2
353
195
28
77
23
8
173
96
14
36
13
4
358
195
60
49
20
14
188
102
31
24
15
7
3%
3%
32%
-11%
-6%
34%
257
167
62
3
9
8
3
890
572
194
27
30
42
8
307
198
63
9
10
18
3
1,118
731
256
39
32
22
11
327
211
76
12
9
6
3
10%
10%
9%
49%
6%
-4%
6%
315
184
34
18
33
7
765
469
96
64
56
14
343
201
42
34
28
8
457
281
65
43
31
13
360
205
47
44
34
10
-7%
-6%
-2%
7%
-16%
2%
Page 46 of 63
CBI MARKET SURVEY:
4.6
Coffee
+ Imports of coffee are increasing, both in value and in volume. Due to price increases, the
increase in value has been especially large.
+ Although Brazil previously dominated coffee supply to the EU, a wide range of countries
now plays a role.
± The role of Germany and Belgium in the trade of green coffee is increasing.
- Imports of green coffee have decreased slightly in volume.
- Imports of roasted coffee originate in EU countries. The limited roasted coffee imports from
Brazil which took place in the past have further decreased.
Tea
± The substantial decrease in black tea imports seen in the last couple of years has stabilised
somewhat. Imports in value still decreased by 2% annually between 2002 and 2006, but
volume imports have been more stable.
± While imports in several traditional tea-countries such as the UK and Poland is decreasing,
other main consumers are showing an increase, such as The Netherlands. Furthermore,
south and East European countries are also showing increasing imports.
+ Imports of green tea are showing a considerable increase.
+ The share of developing countries in EU imports increased, showing an increasing tendency
for direct imports, instead of through the main trading countries, such as Germany and the
UK.
Cocoa
- Imports of cocoa beans, paste and powder into the EU decreased in value. However,
imports increased in volume, showing a decrease in import prices.
+ Imports of cocoa butter show a very good development, with imports increasing both in
value and volume. Moreover, imports from developing countries are increasing faster than
overall imports.
± Only a few EU countries play a role in the imports of cocoa beans.
- The share of developing countries in cocoa paste and powder imports has decreased. For
cocoa beans and paste, direct imports from developing countries remain prominent, but for
powder, developing countries have a more marginal position in EU supply.
+ Although Ivory Coast and Ghana take a dominant position in developing country supply to
the EU, many countries play a role in the supply of cocoa beans. This is less the case for
the processed cocoa products.
4.7
•
•
•
•
Useful sources
EU Expanding Exports Helpdesk - http://exporthelp.europa.eu Î go to: trade statistics
Eurostat – official statistical office of the EU Î http://epp.eurostat.ec.europa.eu Î go to
‘themes’ on the left side of the home page Î go to ‘external trade’ Î go to ‘data – full
view’ Î go to ‘external trade - detailed data’
Understanding Eurostat: quick guide to easy Comext Î
http://epp.eurostat.ec.europa.eu/newxtweb/assets/User_guide_Easy_Comext_20080117.p
df
International Coffee Report, World Tea Markets, Chocolate & Confectionery International http://www.agra-net.com
Page 47 of 63
CBI MARKET SURVEY:
5
PRICE DEVELOPMENTS
5.1
Coffee
As was already indicated in chapter 4, prices of coffee have a tremendous effect on import
figures of coffee. Figure 5.1 shows the development of coffee prices during the last three
years, which clearly reveals a slight overall rise. Especially prices for Robusta improved
considerably. Prices are much higher than the period before 2004, when average prices were
recorded as low as €1.10 per kilo. Please note that in Euro this increase is smaller, due to the
increasing exchange rate strength of that currency against the US$ during the review period.
During the period after 2004 the considerable imbalance between supply and demand
(oversupply) for coffee began to decrease.
However, prices of coffee remain very volatile, responding to climatic and consumption news
hitting the market. Although 2007 was a relatively stable year prices reached a high of € 1.80
per kilo and a low of € 1.60 per kilo. On a weekly basis, fluctuations can be much larger, due
to speculative buying of coffee futures. After a substantial slump in prices in the winter and
spring of 2007, prices increased to around € 1.75 per kilo at the end of 2007, climbing to
almost € 2.10 in February 2008. Prices are expected to remain at present high levels in 2008
(Food and Drink Europe, 2008)
Figure 5.1
Weighted3 prices for coffee, 2004-2007, in € per kilo
€ 3.00
€ 2.50
€ 2.00
Average
C olombian Mild Arabicas
Other Mild Arabicas
Brazilian Natural Arabicas
Robustas
€ 1.50
€ 1.00
€ 0.50
jan-08
sep-07
nov-07
jul-07
Mar-2007
May-2007
jan-07
sep-06
nov-06
jul-06
Mar-2006
May-2006
jan-06
sep-05
nov-05
jul-05
Mar-2005
May-2005
jan-05
€-
Source: ICO 2008
Coffee stocks in consuming countries have remained substantial, but have decreased in several
EU countries (ICO, 2006). For the coming years, however, some coffee traders and analysts
are anticipating decreasing prices as coffee output in Vietnam and Brazil will increase, setting
the scene for a (limited) decrease in prices for the coming three of four years (Public Ledger,
December 2007).
3
Please note that weighted prices have been calculated including both European and American trade market prices
(with more weight for Europe due to the greater demand in Europe). As ex-dock prices regarding sales from origin are
measured, the combined aggregate gives a good idea of world market prices. As coffee is a bulk commodity traded
worldwide, these world prices are most indicative. The composite price is based on weighted averages of the different
varieties (Colombian Milds: 13%, Other Milds: 27%, Brazilian Naturals: 25%, Robustas: 35%).
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CBI MARKET SURVEY:
Please note that coffee is not a homogenous product. Each parcel of coffee is unique with
regard to its characteristics, flavour and quality and, hence, attracts a different price.
However, coffee is traditionally treated as a homogenous product, with prices established on
one of the main terminal or futures markets. Consequently, coffee trade is conducted on a
price-differential basis, with prices of actual trade transactions expressed as differentials to
future market prices on an FOB basis. Because of increasingly sophisticated roasting practices
it is becoming easier for roasters to switch between origins without jeopardizing constant
quality, making it easier for them to look for value for their money, resulting in increasingly
volatile markets.
As can be seen in Table 5.1, prices paid to growers in developing countries are considerably
lower. Whereas world market prices for Arabica averaged around €2.05 in 2006, only
Indonesian growers received payments approaching this figure.
Table 5.1
Prices paid to growers in exporting Member countries, € per kg
(Arabica), 2006
Producing country
Brazil
Colombia
Ethiopia
Guatemala
India
Indonesia
Source: ICO 2008
Price
€ 1.53
€ 1.58
€ 1.03
€ 1.60
€ 1.68
€ 1.89
Organic and Fair-Trade coffee
According to industry sources, prices for organic coffee depend much on the location
characteristics, which affect the bean quality. At the moment, organic premiums are increasing
but can in some cases be rather low. Organic premiums for Arabica coffee range between
€ 0.14 (US$ 0.22) per kilo for Bolivian coffees, to almost € 0.64 (US$ 1.00) for Colombian and
Mexican coffee. Peruvian coffee takes an intermediate position with premiums around € 0.35
(US$ 0.55) per kilo. This ranges between 6% and 30% above conventional prices. More in
general, premiums range between 15% and 25%. With premiums as low as 6% reaching a
breakeven point, producers make higher costs when producing organic will depend on the
quantities produced. The premium for Robusta coffee is around 15% above the conventional
price in London.
The FairTrade premium, which was established on 1st June 2007 by the FairTrade Labelling
Organisations International (FLO), is € 0.14 (US$ 0.22) per kilo. The premium for organic
FairTrade coffee is € 0.28 (US$ 0.44) per kilo. FLO decided last December to increase the FairTrade minimum price levels for Arabica coffee. This will become effective from 1st June 2008.
See the table below. Furthermore, specialty coffees and regional specialties command a much
higher market price.
Table 5.2
Fairtrade minimum price, US$ per kilo
Washed arabica
Unwashed arabica
Source: FLO, 2008
Conventional
€ 1.89
US$ 2.97
€ 1.82
US$ 2.86
Organic
€ 2.17
US$ 3.41
€ 2.10
US$ 3.30
Retail prices
The average retail price of coffee shows a very large divergence between the EU countries.
Prices per kilo range from € 4.86 in Poland to € 27.79 in the United Kingdom. Prices in East
European countries reflect the overall lower price levels for food products in these countries.
Scandinavian countries have among the lowest prices, which are caused by the very high
consumption in these countries and the extremely fierce competition prevailing on the coffee
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CBI MARKET SURVEY:
consumer market. Roasters often sell their products below production costs for extended
periods. In the rest of the EU, prices are quite similar, around €7.00 or €8.00. The very high
prices in the United Kingdom are probably caused by more limited competition, but especially
by the high proportion of coffee consumed as instant coffee, with much higher per kilo prices.
Prices are also relatively high in Italy (€ 11.06 per kilo), which might be due to the large
number of small roasters on the market and the wide range in qualities sold on the market,
with a focus on more expensive espresso coffees.
5.2
Tea
In 2007, prices for tea were relatively low. In 2008, global tea prices are expected to increase
as a result of the limited supply on the global market, especially caused by a decrease in
Kenyan production due to political upheavals. The impact of the Kenyan crisis has already been
felt on tea markets around the world, where prices have risen as traders look for alternative
suppliers. In Mombasa, the first auction of 2008 saw prices rise sharply as exporters built up
stocks based on fears of more unrest in the country. During the second auction, a very strong
demand was reported, pushing prices up to € 1.40 per kilo, an increase of 17% when
compared to the average in the final auction in 2007 (F.O. Lichts, 2008).
Tea quality, and therefore tea prices, is determined on the basis of liquor, aroma/flavour and
leaf appearance. The quality of tea has been decreasing, creating niche markets for highquality tea. Governments in producing countries focused more on increasing supply than
increasing quality and further processing. Therefore, supply constraints and high prices for
high quality teas persist.
Tea prices show a large variation, both at the aggregate level and the auction level, due to
large differences in quality. A considerable percentage of globally produced tea is traded at
auctions. In June 2007, the average price for tea at the three main auction centres – Colombo
(Sri Lanka), Kolkata (India) and Mombasa (Kenya) – was € 1.45 per kilo, signifying a slight
increase compared to 2005, but a decrease compared to 2006 in real terms. However, when
analysing the annual averages in US dollars, an increase seem to have occurred since 2005.
Most sources within the tea market still predict a continuation of price increases on the
international tea market. Prices will keep on improving on the short term, and might even
increase further in the face of increased political uncertainty in some producing countries, or if
tea consumption in China keeps on growing.
Table 5.3
Auction prices for tea at the three major auctions, 2005-2007,
in € and US$ per kilo
Annual averages*
Quarterly averages
JulOctJanApr2005 2006 2007 Sep-06 Dec-06 Mar-07 Jun-07
Average of 3 auctions (€)
1.23 1.52 1.45
1.58
1.55
1.37
1.51
Average of 3 auctions (US$) 1.64 1.83 1.89
1.92
1.88
1.80
1.99
Colombo (€)
1.38 1.56 1.78
1.60
1.75
1.75
1.80
Colombo (US$)
1.83 1.87 2.33
1.94
2.12
2.31
2.36
Kolkata (€)
1.22 1.42 1.31
1.58
1.48
1.09
1.52
Kolkata (US$)
1.63 1.71 1.72
1.91
1.80
1.44
2.00
Mombasa (€)
1.10 1.59 1.25
1.57
1.42
1.26
1.22
Mombasa (US$)
1.46 1.91 1.63
1.91
1.72
1.66
1.60
* The annual averages were calculated based on prices until June of each year.
Source: International Tea Committee 2007
Monthly averages
Apr- May- Jun07
07
07
1.51 1.45 1.57
2.00 1.91 2.05
1.80 1.78 1.81
2.38 2.34 2.36
1.55 1.39 1.63
2.04 1.83 2.13
1.19 1.18 1.27
1.58 1.55 1.66
Organic and Fair-Trade tea
The price for organic tea strongly follows the market rules and, similar to conventional prices,
is largely based on quality. Even compared to considerable price fluctuation on the
conventional market, prices on the small organic tea market are extremely variable. Organic
premiums have decreased in recent years and can now be as low as 10%. Furthermore, due to
Page 50 of 63
CBI MARKET SURVEY:
changing preferences within the health trend (from green tea to rooibos, for example) organic
global production and organic EU consumption do not always match each other.
The Fair-Trade price premium is fixed for all teas produced with the CTC (Cut, Tear and Curl)
production method, as well as for orthodox fanning and dust, at € 0.50 per kg of made tea. All
other teas manufactured with the orthodox method will carry a Fair-Trade premium of € 1.00
per kg, independent of the market price mentioned above. The Fair-Trade premium for
Rooibos, Camomile, Mint and Hibiscus is set at € 0.50 per kilo (Flo, 2007).
5.3
Cocoa
Prices for cocoa beans are readily available, as are prices for cocoa butter. Prices for other
cocoa products such as powder, liquor and paste are more difficult to identify and are available
for a smaller range of origins and grades. The International Cocoa Organisation (ICCO) has
comprehensive data on daily physical prices for cocoa beans, which is completely up to date.
Please note that prices are given using the average quotation on the London Cocoa Terminal
Market and the New York Board of Trade. These are the two major trading platforms where the
international price for cocoa is determined. Prices for cocoa beans showed a dramatic increase
between 2000 and 2002, to a maximum of almost € 2,000 per tonne. However, up until 2004
prices decreased, to a low of just above € 950 per tonne in June 2004, with devastating effects
for cocoa farmers worldwide. Until early 2007, average monthly prices remained at a higher
level, ranging between € 1,200 to somewhat above € 1,300 per tonne. Figure 9.3 shows the
development since January 2005. It shows a considerable improvement from the end of 2006,
except for a slump in mid-2007. In December 2007, the price for cocoa reached € 1,451 per
tonne, due to current weather-related supply issues. In January 2008, because of market
speculation and investments in the commodity market, the price of cocoa continued to rise,
having an average daily price of € 1,460 per tonne (ICCO, 2008).
Figure 5.2
Annual averages of daily prices of cocoa beans, 2005-2007, € per tonne
€ 1,600.00
€ 1,500.00
€ 1,400.00
€ 1,300.00
€ 1,200.00
€ 1,100.00
nov-07
sep-07
jul-07
May-2007
Mar-2007
jan-07
nov-06
sep-06
jul-06
May-2006
Mar-2006
jan-06
nov-05
sep-05
jul-05
May-2005
Mar-2005
jan-05
€ 1,000.00
Source: ICCO 2008
As for the future, the ICCO annual cocoa bulletin predicts an increase in prices between 2008
and 2012. These projections are based on stocks (based on changes in demand and supply for
beans) and the size of stocks compared to grindings. Between 2006 and 2012 prices are
expected to increase by 11% over the average price in the 2006/2007 season (around
€ 1,370). Please note that this price increase is measured in SDR (Special Drawing Rights) –
an artificial currency basket used by international organisations to counter the effects of
currency fluctuations in projections. Therefore, applying this increase to the Euro prices above
should be done with extreme caution and a large margin. With increasing volumes, the annual
Page 51 of 63
CBI MARKET SURVEY:
market value of world cocoa production is projected to increase by about 2.8% per annum in
real (SDR) terms between the 2007/2008 and 2011/12 seasons.
As prices fluctuate on a daily basis, the information above should be used exclusively as an
indication. Prices for cocoa beans futures, including different varieties, are also given in the
Public Ledger, and are directly provided by Liffe and the New York Board of Trade. These prices
are given in US $ and British Pounds. Both exchanges also provide additional trade information
about cocoa beans and derivate products. Ex-dock prices for physicals are also provided for
cocoa beans, liquor and butter by the Public Ledger. An overview is given in Table 5.4 below.
Table 5.4
Prices of cocoa beans, liquor, cake and butter, € per tonne
Settl.11 Jan-Dec 2007 High
Jan
Beans
Main crop Ivory Coast beans ex dock US spot
€ 1,667
€ 1,644
Ghana main-crop ex dock US spot
€ 1,749
€ 1,883
Sanchez Faq beans ex dock US spot
€ 1,702
€ 1,823
Sulawesi Saq beans ex dock US spot
€ 1,593
€ 1,708
Arriba superior beans ex dock US spot
€ 1,786
€ 2,111
Malaysian 110 beans ex dock US spot
€ 1,462
€ 1,561
Paste
Equador liquor ex dock US spot
€ 2,606
€ 2,962
Butter
European Butter
€ 4,611
€ 5,241
African Type pure pressed butter
€ 4,291
€ 4,596
Cake
Natural 10/12% pressed cake
€ 899
€ 735
Source: The Public Ledger dec-2007, jan-2008, currency conversions using Oanda
Jan-Dec 2007
Low
€
€
€
€
€
€
1,354
1,422
1,343
1,184
1,698
1,156
€ 2,255
€ 3,133
€ 3,083
€ 601
Organic and Fair-Trade cocoa
Organic prices for cocoa fluctuate according to the market situation. Unless the product is part
of secured arrangements (such as Fair Trade) there is no secured premium for certified
products. Premium prices paid for organic cocoa depend heavily on the market. At the
moment, demand is growing faster than production, especially for Fair-Trade and organic
(double certified) cocoa.
Current premiums are highly favourable, however. According to industrial sources, the FOB
price for organic cocoa beans in the Dominican Republic was between € 2,500 and € 2,800 per
tonne in February 2008. The last months, organic differentials range between 30% to 60%.
This price was around 55% higher than the price for conventional cocoa beans. However, the
difference in price between conventional and organic cocoa can be even higher. In September
2007, the prices for organic cocoa were 80% higher than the prices for conventional cocoa.
African countries are still not growing cocoa organically. In the future, however, this reality
may change. There is already organic cocoa from Ivory Coast and Ghana.
There is also a premium price for Fair-trade cocoa products. Fair-Trade certification entails an
additional premium of US$ 150 per metric tonne above a minimum conventional price set by
FLO of US$ 1,650 per tonne. If the cocoa is organic-certified, the Fair-Trade premium is
US$200 per metric tonne (FLO, 2008). The minimum organic price is US$ 1900.
5.4
Useful sources
International Trade Organisations
• International Coffee Organisation (ICO):
• International Cocoa Organisation (ICCO):
• International Tea Committee (Inttea):
http://www.ico.org
http://www.ICCO.org
http://www.inttea.com
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CBI MARKET SURVEY:
Other Sources
• Public Ledger:
• Liffe:
• New York Board of Trade:
• Fairtrade Labelling Organizations International
http://www.agra-net.com
http://www.liffe-commodities.com
https://www.nybotlive.com
http://www.fairtrade.net
Page 53 of 63
CBI MARKET SURVEY:
6
MARKET ACCESS REQUIREMENTS
As a manufacturer in a developing country preparing to access EU markets, you should be
aware of the market access requirements of your trading partners and the EU governments.
Requirements are demanded through legislation and through labels, codes and management
systems. These requirements are based on environmental, consumer health and safety and
social concerns. You need to comply with EU legislation and have to be aware of the additional
non-legislative requirements that your trading partners in the EU might request.
For information on legislative and non-legislative requirements, go to ‘Search CBI database’ at
http://www.cbi.eu/marketinfo, select coffee, tea and cocoa and the EU in the category search,
click on the search button and click on market access requirements.
Coffee beans are usually transported in bags. Currently, most coffee is transported in 20-foot
dry containers, which is a considerable improvement over the old break-bulk method, but still
involves extensive handling. Coffee is also transported in bulk in polypropylene fitted
containers. Container shipment is not suited for longer stretches unless containers are
ventilated: this is a condition which can be specified in contracts by EU traders and roasters.
The limited exports from developing countries of soluble coffee as finished product (in primary
packaging, mostly bags but also bulk) with retail packaging are taking place in the EU.
In the case of tea, a distinction can be made between packaging of tea in the producing
country and consumer packaging in the EU. Packaging in producing countries is only to a
limited degree in tinfoil lined 50 kg plywood boxes. Packaging is increasingly taking place in
paper bag packages with protective layers, which limits packaging waste and is easier to
transport in containers.
Cocoa beans have been traditionally shipped in bags or sacks, which are often stored in
ventilated containers during shipment. Cocoa powder is also transported and often also stored
in bags from 25 kilos upwards, but is also supplied in bulk. Important aspects to monitor are
air humidity (to avoid lumping), temperature fluctuations (to avoid crystallisation), pressure
(to avoid lumping), and transport in odour-free environments. The storage temperature should
be between 15oC and 18oC and not more than 20oC and the air humidity below 50%. A good
information source is the International Trade Centre’s “Cocoa: A Guide to Trade Practices”
(http://www.intracen.org/eShop/f_e_IP_Title.Asp?ID=9602&LN=EN).
Cocoa butter is transported in moulded slabs or as liquids in tanks. The standard packaging of
cocoa butter during intercontinental transport is 25 kilo in polypropylene or polyester sacks.
These are then put in cardboard boxes and allowed to cool into moulded slabs. Cocoa butter
has a low content of unsaturated fatty acids, especially polyunsaturated, and therefore the
shelf life of the fat is relatively good. According to ICCO, if cocoa butter is moulded into slabs
directly after production and the slabs are well packed in order to prevent oxidation, the shelf
life should be several years.
Cocoa butter is also transported in liquid form in tankers. This happens mainly for shorter
stretches. More care must be taken if the shelf life is to be maintained. Factors to watch are
temperature (below 45oC), air/oxidation (air coming into contact with the cocoa butter causes
rancidity), storage in the dark, and humidity (between 50% and 60%). In addition, after the
tanks are emptied all residues of cocoa butter must be removed as they will go rancid and
contaminate the next batch to be delivered.
The EU Commission and the International Maritime Organisation (IMO) in London issue
packaging requirements for crude and (semi) processed products. Directive 96/3/EC regulates
the sea transport in bulk of liquid oil and fats in respect to food hygiene standards. EU
Directive 93/43/EC applies to bulk packaging of animal and vegetable oils and fats.
Page 54 of 63
CBI MARKET SURVEY:
Additional information on packaging can be found at the website of ITC on export packaging:
http://www.intracen.org/ep/packaging/packit.htm
Information on tariffs and quota can be found at http://exporthelp.europa.eu
Page 55 of 63
CBI MARKET SURVEY:
7
OPPORTUNITIES AND THREATS
This survey discusses three different markets. Although developments across the three are
partly related, especially between coffee and tea, there exist large differences in the
development of the different markets, and therefore also in the opportunities and threats
which influence exporters in developing countries.
Several of the previous chapters provided information on trends and developments shaping the
EU markets for coffee, tea and cocoa. Furthermore, these were translated into opportunities
and threats affecting the possibilities for developing country exporters to do business in the
EU. However, it is important to keep in mind that the same development or trend can be an
opportunity for one exporter and a threat to another. Exporters should therefore analyse if the
developments and trends discussed in the previous chapters provide opportunities or threats.
The outcome of this analysis depends on the specific situation of an exporter.
An example is the increasing interest in the EU in single origin products. Although this offers
opportunities to exporters of coffee, tea and cocoa alike, several critical notes should be made.
First, single origin cocoa mostly relates to premium cocoa from Venezuela and Ecuador. These
countries are known for their high-quality cocoa products; these qualities are recognised by EU
traders, resulting in significant premiums, the premiums being related to the higher quality. It
is interesting to note, however, that Barry Callebaut, the world’s leading manufacturer of high
quality cocoa and chocolate products, has recently increased its single origin offerings. This
tactical manoeuvre may change the market for premium chocolate. The single origin market
for coffee and tea is of much wider interest and is also marketed more directly to EU
consumers. For example, Mount Kenya teas growing on the slopes of the mountain, or Café de
Colombia – which is actually a protected brand on the EU market etc.
Secondly, exporters in developing countries cannot just decide to market their products as a
single origin product. Development of single origin, which is in this sense a brand that needs to
be marketed, takes time, and needs to be related to a high quality, and/or a specific ‘story’.
Only certain locations will ‘ring a bell’ with EU consumers. However, this type of marketing is
far more evolved for coffee and tea than for cocoa. For example, premium coffee shops, but
also premium ranges of supermarkets, offer a range of coffees from one country, which
provide a special taste, differentiating them both from the other country tastes offered, as well
as from conventional coffee.
These considerations mean that an exporter cannot simply enter the EU market with singleorigin coffee, tea or cocoa. It requires time, a good quality product, often a specific story
underwriting the uniqueness of the location, etc. Only in certain occasions will the appellation
of origin already exist and then it would still be necessary to find buyers in the EU, as these
are often already working with existing producers from the same region.
Page 56 of 63
CBI MARKET SURVEY:
APPENDIX A PRODUCT CHARACTERISTICS
Product groups
Coffee
Commercially, the most important coffee varieties are Coffea arabica (Arabica) and Coffea
canephora (Robusta). In comparison with Arabica, 30% higher yields are gained from Robusta,
but Robusta’s price is about 30% lower.
Share of global
production
Site requirements
Main growing areas
Caffeine content
Diseases/pests
Arabica
approximately 70%
Robusta
approximately 30%
High altitude: fluctuations in
annual rainfall and temperature
Latin America, Central and East
Africa, India, Indonesia
0.8-1.4%
Susceptible to the berry borer
and coffee rust
Low altitude: steady high temperatures
and rainfall
Asia, West and Central Africa, Brazil
1.7-4.0%
Resistant to the berry borer and coffee
rust
Source: ICO, 2007
Two other species which are grown on a much smaller scale are Coffea liberica (Liberica
coffee) and Coffea dewevrei (Excelsa coffee). Raw coffee is treated by processing the ripe, red
coffee cherries of the bush-like coffee tree. Processing includes dry or wet processing,
dehulling, grading, cleaning, sorting and packing. Blending and roasting the raw coffee is
mostly carried out in the importing countries.
Tea
The tea varieties cultivated are all hybrids of the original tea plants Cammelia sinensis or Thea
sinensis. Commercially, there are three major varieties of Camellia sinensis: the China type,
the India (Assam region) type, and the Hybrid type (a cross breed of the China and India
types). The China type tea plant has small leaves and usually grows well at higher altitudes.
The India type has larger leaves and cultivates best at lower elevations. The Hybrid falls
somewhere in between. Manufacturing of tea includes sorting, withering, rolling, fermentation,
drying and sifting.
There are four major types of tea: White, Black, Green and Oolong. All these teas come from
the raw leaves of the same plant. What distinguishes each category is the method used when
processing the tea leaves.
•
White tea: Steamed and dried
•
Black tea: Fully fermented tea.
•
Green tea: Certain enzymes in the fresh leaves are inactivated through heat treatment.
Only then is the product rolled and dried. Fermentation is suppressed by deactivating
these enzymes and the leaves retain their green colour.
•
Oolong tea: The fermentation process is halted at an earlier stage (partly fermented tea).
•
Tea spin-offs, such as scented, flavoured or blended teas, are produced using one of the
four major types of tea as a base. Instant teas are made either from low-quality teas
(fermented and dried), or from non-dried tea in a special process directly after
fermentation. Instant teas lose much of their aroma during the extraction and
subsequent freeze-drying processes.
Not directly included under tea, there are herbal teas, especially rooibos, which are quickly
increasing in popularity across the EU. Although they are an important growth market, they
have not been included in this survey, as they do not have specific CN codes. Therefore,
information on these products is mostly limited to qualitative data; the latter have been
included in this survey.
Page 57 of 63
CBI MARKET SURVEY:
Cocoa
This survey focuses on the market for cocoa beans, but will also look into markets for
processed cocoa products such as cocoa paste, cocoa butter and cocoa powder.
Cocoa beans
Although fruits mature throughout the year, usually there are only two harvests. Pods are cut
from trees and allowed to mellow on the ground. The extracted beans are fermented before
drying in the sun, at which time they change from purple to brown. Beans are then bagged for
further processing, which firstly concerns roasting and grinding to form cocoa paste. While
other material is discarded, they have certain applications 4. The products below will be
referred to as processed cocoa products.
Cocoa liquor/paste/mass
Cocoa paste (also called liquor or mass) concerns cocoa particles suspended in cocoa butter.
The cocoa paste is pressed to extract the cocoa butter leaving a solid mass called cocoa press
cake, which is pulverised to make cocoa powder. Cocoa cake is also traded separately but
mainly on a continental scale, and is of limited interest for developing country producers and
therefore not included here. Cocoa paste is also used directly in the production of chocolate.
Cocoa powder
Cocoa powder contains not less than 20% cocoa butter, calculated according to the weight of
the dry matter, and not more than 9% water. Fat-reduced cocoa powder signifies cocoa
powder containing less than 20% cocoa butter. Cocoa powder is used in a very wide range of
food products and beverages.
Cocoa butter
Designates the fat obtained from cocoa beans or its parts:
• Maximum of 1.75% free fatty acid content
• Maximum of 0.5% unsaponifiable matter, except for press cocoa butter for which the
maximum is 0.35%.
Cocoa butter is the only product which is used outside of the food sector, i.e. in cosmetics.
Conventional versus organic production
Organic farming practised in almost all countries of the world. The development which has
taken place in the organic market in recent years has thus been driven in Europe by a solid
base of producers and consumers, who are convinced of the ecological and social benefits of
organic methods. Therefore, organic food products are increasingly becoming an established
market segment. In 2005 organic consumption in the EU exceeded € 14 billion (FiBL 2007)5.
The market for organic products offers good possibilities to exporters of coffee, tea and cocoa,
with growth exceeding developments in the regular market. Fair Trade, as well as other
certification schemes for coffee, offer good possibilities also increasingly in combination with
organic certification. Moreover, organic and other certified products, as well as high-quality
specialties, are an especially good opportunity, because conventional products are mass
commodities where traded quantities are large and it is more difficult to compete. Organic
products also offer a premium, compared to conventional products.
Products labelled as organic are those certified as having been produced using clearly defined
organic production methods. In other words, “organic” is a claim related to the production
process rather than to the product itself. It should be noted that the term “organic” is mainly
used by the English-speaking countries, while other countries (for instance French-speaking)
use the term “biologic”. Also of importance is the term “sustainable” agriculture or production,
which is often used in literature. Sustainable is a broader term than organic, which, while also
4
An ICCO (International Cocoa Organisation) funded project finished in 2003 had the objective to assess the
possibilities for the commercial production and marketing of a range of by-products using these materials. Products
investigated include animal feed and potash derived from cocoa-pod husk. Cocoa-pulp juice is used in the production
of soft drinks, alcoholic drinks, industrial alcohol, pectin, marmalade and jams.
5
BioPlus AG/ORA/Organic Monitor/FiBL 2007
Page 58 of 63
CBI MARKET SURVEY:
including organic, also includes natural or Fair Trade agriculture for example. This survey uses
the term sustainable when a combination of certification schemes is discussed.
Standards for organic food production and labelling in the European Union are laid down in
Council Regulation (EEC) 2092/91. This regulation and subsequent amendments establish the
main principles for organic production at farm level and the rules which must be followed for
the processing, sale and import of organic products from third (non-EU) countries. Principles
for Fair Trade or other certification schemes are laid down by their respective certification
bodies. Fair Trade certification, for example, is administered by FLO International.
Statistical product classification
Combined nomenclature (CN)
In this survey, trade data based on the Combined Nomenclature are used. These data are
provided by Eurostat, the statistical body of the EU. The abbreviation CN stands for Combined
Nomenclature. This Combined Nomenclature contains the goods classification prescribed by the
EU for international trade statistics. The CN is an 8-digit classification consisting of a further
specification of the 6-digit Harmonised System (HS). HS was developed by the World Customs
Organisation (WCO). The system covers about 5,000 commodity groups, each identified by a
six-digit code. More than 179 countries and economies use the system.
Statistical data: limitations
Trade figures quoted in CBI market surveys must be interpreted and used with extreme
caution.
In the case of intra-EU trade, statistical surveying is only compulsory for exporting and
importing firms whose trade exceeds a certain annual value. The threshold varies considerably
from country to country, but it is typically about € 100,000. As a consequence, although
figures for trade between the EU and the rest of the world are accurately represented, trade
within the EU is generally underestimated.
Furthermore, the information used in CBI market surveys is obtained from a variety of
sources. Therefore, extreme care must be taken in the qualitative use and interpretation of
quantitative data, because it puts limitations to in-depth interpretation of relations between
consumption, production and trade figures within one country and between different countries.
HS code
Coffee
0901
0901 11/12
0901 21/22
Tea
0902
0902 10/20
0902 30/40
Cocoa
1801
1803
1804
1805
Product
Coffee
Green coffee
Roasted coffee
Tea
Green Tea
Black Tea
Cocoa
Cocoa
Cocoa
Cocoa
beans, whole or broken, raw or roasted
paste
butter
powder without added sugar or sweeteners
Page 59 of 63
CBI MARKET SURVEY:
APPENDIX B INTRODUCTION TO THE EU MARKET
The European Union (EU) is the current name for the former European Community. Since
January 1995 the EU has consisted of 15 member states. Ten new countries joined the EU in
May 2004. In January 2007 two more countries – Bulgaria and Romania - joined the EU.
Negotiations are in progress with a number of other candidate member states. In this survey,
the EU is referred to as the EU27, unless otherwise stated.
Cultural awareness is a critical skill in securing success as an exporter. The enlargement of the
EU has increased the size of the EU, and also significantly increased its complexity. Because
there are more people from culturally diverse backgrounds, effective communication is
necessary. Be aware of differences in respect of meeting and greeting people (use of names,
body language etc.) and of building relationships. There are also differences in dealings with
hierarchy, presentations, negotiating, decision making and handling conflicts. More information
on cultural differences can be found in chapter 3 of CBI’s export manual ‘Exporting to the EU
(2006)’.
General information on the EU can also be found at the official EU website
http://europa.eu/abc/governments/index_en.htm or the free encyclopaedia Wikipedia
http://en.wikipedia.org/wiki/Portal:Europe.
Monetary unit: Euro
On 1 January 1999, the Euro became the legal currency within eleven EU member states:
Austria, Belgium, Finland, France, Germany, Italy, Ireland, Luxembourg, The Netherlands,
Spain, and Portugal. Greece became the 12th member state to adopt the Euro on January 1,
2001. Slovenia adopted the Euro in 2007. Since 2002 Euro coins and banknotes replaced
national currency in these countries. Denmark, United Kingdom and Sweden have decided not
to participate in the Euro.
In CBI market surveys, the Euro (€) is the basic currency unit used to indicate value.
Table 1
Country
Exchange rates of EU currencies in €, average yearly interbank rate
Name
Code
2007
January
2008
Bulgaria
Lev
BGN
0.513
0.512
Cyprus
Pound
CYP
1.721
1.709
Czech Republic
Crown
CZK
0.036
0.038
Denmark
Crown
DKK
0.134
0.134
Estonia
Crown
EEK
0.064
0.064
Hungary
Forint
HUF
0.004
0.004
Latvia
Lats
LVL
1.436
1.447
Lithuania
Litas
LTL
0.290
0.291
Malta
Lira
MTL
2.335
2.329
Poland
Zloty
PLN
0.265
0.278
Romania
Lei
ROL
0.301
0.273
Slovakia
Crown
SKK
0.030
0.030
Sweden
Crown
SEK
0.108
0.106
United Kingdom
Pound
GBP
1.462
1.340
Source: Oanda http://www.oanda.com/ (February 2008)
Page 60 of 63
CBI MARKET SURVEY:
APPENDIX C LISTS OF DEVELOPING COUNTRIES
OECD DAC list - January 2006
When referring to developing countries in the CBI market surveys, reference is made to the
group of countries on this OECD DAC list of January 2006.
Afghanistan
Albania
Algeria
Angola
Anguilla
Antigua and Barbuda
Argentina
Armenia
Azerbaijan
Bangladesh
Barbados
Belarus
Belize
Benin
Bhutan
Bolivia
Bosnia & Herzegovina
Botswana
Brazil
Burkina Faso
Burundi
Cambodia
Cameroon
Cape Verde
Central African Rep.
Chad
Chile
China
Colombia
Comoros
Congo Democratic Rep.
Congo Rep.
Cook Islands
Costa Rica
Cote d’Ivoire
Croatia
Cuba
Djibouti
Dominica
Dominican Republic
Ecuador
Egypt
El Salvador
Equatorial Guinea
Eritrea
Ethiopia
Fiji
Gabon
Nepal
Gambia
Nicargua
Georgia
Niger
Ghana
Nigeria
Grenada
Niue
Guatemala
Oman
Guinea
Pakistan
Guinea-Bissau
Palau
Guyana
Palestinian Admin. Areas
Haiti
Panama
Honduras
Papua New Guinea
India
Paraguay
Indonesia
Peru
Iran
Philippines
Iraq
Rwanda
Jamaica
Samoa
Jordan
Sao Tome & Principe
Kazakhstan
Saudi Arabia
Kenya
Senegal
Kiribati
Serbia
Korea Rep. of
Seychelles
Kyrgyz Rep.
Sierra Leone
Laos
Solomon Islands
Lebanon
Somalia
Liberia
South Africa
Libya
Sri Lanka
Macedonia
St. Helena
Madagascar
St. Kitts Nevis
Malawi
St. Lucia
Malaysia
St. Vincent & Grenadines
Maldives
Sudan
Mali
Suriname
Marshall Islands
Swaziland
Mauritania
Syria
Mauritius
Tajikistan
Mayotte
Tanzania
Mexico
Thailand
Micronesia, Fed. States Timor-Leste
Moldova
Togo
Mongolia
Trinidad & Tobago
Montenegro
Tunisia
Montserrat
Turkey
Morocco
Turkmenistan
Mozambique
Turks & Caicos Islands
Myanmar
Tuvalu
Namibia
Uganda
Nauru
Ukraine
Uruguay
Uzbekistan
Vanuatu
Venezeula
Vietnam
Wallis & Futuna
Yemen
Zambia
Zimbabwe
Page 61 of 63
CBI MARKET SURVEY:
CBI countries – January 2007:
CBI supports exporters in the following Asian, African, Latin American and European (Balkan)
countries:
Albania
Armenia
Bangladesh
Benin
Bolivia
Bosnia-Herzegovina
Burkina Faso
Colombia
Ecuador
Egypt
El Salvador
Ethiopia
Georgia
Ghana
Guatemala
Honduras
India
Indonesia
Jordan
Kenya
Macedonia
Madagascar
Mali
Moldova
Montenegro
Morocco
Mozambique
Nepal
Nicaragua
Pakistan
Peru
Philippines
Rwanda
Senegal
Serbia
South Africa
Sri Lanka
Suriname
Tanzania
Thailand
Tunisia
Uganda
Vietnam
Zambia
Page 62 of 63
CBI MARKET SURVEY:
APPENDIX D REFERENCES
•
•
•
•
•
•
•
•
•
International Tea Committee, ITC (2002), ‘Annual Bulletin of Statistics 2007’
http://www.inttea.com
International Cocoa Organization, ICCO (2005), ‘The World Cocoa Directory 2005-2006’,
http://www.ICCO.org
International Cocoa Organization, ICCO (2008), ‘Quarterly Bulletin of Cocoa Statistics
Volume XXXIV No. 1 Cocoa Year 2007/08’ http://www.ICCO.org
International Coffee Organization, ICO (2006, 2007, 2008) ‘Coffee Market Reports’
International Trade Centre, (2002), ‘Coffee: An Exporter’s Guide’, http://www.intracen.org
International Trade Centre, (2001), ‘Cocoa: A Guide to Trade Practices’.
http://www.intracen.org
Somo, ProFound & India Committee of the Netherlands (2006), ‘Sustainabilitea: The Dutch
Tea Market and Corporate Social Responsibility’. http://www.ThisIsProFound.com
FiBL, SIPPO and Naturland ‘Organic coffee, cocoa and tea’
https://www.fibl.org/shop/show.php?sprache=EN&art=1227
The Sustainable Cocoa Trade: An Analysis of US Market and Latin American Trade
Prospects. EcoMercados Project, El Centro de Inteligencia sobre Mercados Sostenibles
(CIMS), Centro Latinoamericano para la Competitividad y el Desarrollo Sostenible
(CLACDS). Available at: http://www.thementers.com/files/knowledgebase/Cocoa.pdf
Page 63 of 63

(organic) coffee, tea and cocoa market in the eu

Transcription

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