Starbucks of Condado Concepción, located on the road to El Salvador, Guatemala, is a sales point that at a distance of 15 minutes by car, has a potential market of more than 150 thousand consumers, and of this group of people 43% are interested in coffee.
Using the Geomarketing solutions we have developed for our clients, CentralAmericaData's Trade Intelligence team analyzed the environment of some of the main coffee shop locations in Central America. Below is an extract of the study's findings.
It is estimated that in El Salvador the current coffee harvest will close at 600,000 quintals, a volume similar to that reported in 1890, when the country had not invested considerably in coffee production.
The lack of maintenance work such as pruning, fertilization, weed control, pests and diseases, are some of the reasons why the volume of coffee cultivation has fallen to levels reported 130 years ago.
Starting to sell beef on the Guatemalan market and evaluating the possibility of signing a trade agreement between the two economies are part of the initiatives proposed by the South American country.
During his visit to Guatemala, Brazilian Foreign Minister Ernesto Araujo stated that another of the South American country's interests is to participate in the organic coffee business.
In the department of El Paraíso, a high-tech plant was inaugurated that will be dedicated to the production and processing of coffee products and specialty coffees.
The plant is located in Teupasenti and is called BioFortune. A $1 million investment was required and it has controlled fermentation and dehydration equipment.
The world market for fresh and processed organic foods is one of the most dynamic today, with coffee, vegetables and tropical fruits being some of the products with the greatest business opportunities.
According to a study prepared by the Promotora de Comercio Exterior (Procomer), Switzerland is the market where the highest expenditure on organic food per person is reported, since it is estimated that consumption amounts to $325 per capita per year.
Costa Rican businessmen are opposed to the bill that gives Icafé the authority to impose requirements and controls on the processes of supplying the raw material necessary for grain production.
In the current period, the Legislative Assembly plans to discuss bill 21.163, which aims to transform the powers of the Costa Rican Coffee Institute (Icafé), but the business sector anticipates that the proposed modifications will lead to a rise in the prices of the product.
Because of the low grain prices reported in 2018, it is estimated that there could be a reduction in supply, which would lead to a rebound in prices this year.
On average, the pound price of grain was close to $1.15 during 2018, however, global businessmen forecast that for this year the price could rise to $1.24 per pound.
In Costa Rica, the coffee sector expects that for the 2018-2019 harvest will be produced about 1.8 million quintals, a volume that would be 11% lower than that recorded in the 2017-2018 season.
According to forecasts by the Costa Rican Coffee Institute (Icafé), between the 2017-2018 and 2018-2019 harvests, the country's production will fall from 2 million to 1.8 million quintals, a decline that would be caused by the cyclical behavior of plants and the aging of coffee plantations.
During the first six months of the year, coffee exports from Central American countries totaled $1,948 million, 9% less than what was reported in the same period in 2017.
Figures from the information system on the coffee market in Central America complied by the Business Intelligence Unit at CentralAmericaData: [GRAFICA caption="Click to interact with graphic"]
Although consumption has remained stable in recent years, the Costa Rican market now demands greater quality and variety in preparation methods.
According to figures from the Chamber of Coffee Roasters, per capita demand in the country is around four kilograms of coffee beans per year, which is equivalent to two cups of coffee per person per day.
In Guatemala, for the 2018-2019 harvest, the production of green coffee is projected to reach 4.5 million quintals, which would exceed the 4.4 million quintals reported in the previous season.
According to Ricardo Arenas, president of the National Coffee Association (Anacafe), "... The 2018-2019 coffee harvest, which started last month, will stand at 4.5 million quintals of green coffee; of that figure, it is estimated that 3.5 million will be exported."
Between the 2011-2012 and 2016-2017 harvests, the difference between the average price per quintal of the country's exports and the international market price of grain has more than doubled, from $25 to $54.
According to Investing.com data and figures provided by the Coffee Institute of Costa Rica (Icafe), during coffee year 2011-2012 the average value of a 46 kg bag of coffee on the New York Market was $198.12 and the average price of Costa Rican exports was $222.76, reflecting a difference of $24.64.
Coffee growers in Guatemala estimate that production in the agricultural cycle that is about to end will totol 4.3 million hundredweight, above the 4.2 million hundredweight reported in the 2016-2017 harvest.
Forecasts by the National Coffee Association (Anacafé) indicate that for the upcoming 2018-2019 harvest, production could be located at 4.5 million gold hundredweight (46 kilos sacks), which would mean a continuation of the recovery phase.
In the first eight months of the year the country generated $381 million from exports of the grain, 14% less than the $445 million reported in the same period in 2017.
According to figures from the Export Procedures Center (Cetrex), a decrease was also reported in relation to the volume exported for the period from January to August of this year, compared to the first eight months of 2017, in this case a drop of 3%.
In June, the country exported 34,000 tons of coffee, registering a fall of 25.5% compared to 46,000 tons sold in the same month in 2017.
The price of coffee also recorded a decline, according to figures from the Center for Procedures for Exports (Cetrex), in June this year $150 per hundredweight was paid, representing a decrease of 10% compared to the $167 paid in the sixth month of 2017.
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