No 29

Colombia: the Greatest Unexplored Specialty Coffee Frontier

October, 2016

Editorial

Colombia: the Greatest Unexplored Specialty Coffee Frontier

At the opening ceremony of ExpoEspeciales Café de Colombia, the FNC CEO highlighted that Colombia, since the 1960s, has been a pioneer in the specialty coffee industry by betting on differentiation and single origin.


“Colombia is the greatest unexplored specialty coffee frontier. There is no other country with this specialty coffee diversity and richness.”

With these words, which invite Colombian coffee farmers to continue producing differentiated coffees and the world to know them, Roberto Vélez, the Colombian Coffee Growers Federation (FNC) CEO, inaugurated the 9th edition of Expoespeciales Café de Colombia, which took place in Bogotá from October 5 to 8.

At the opening ceremony, Vélez underlined that Colombia will continue advancing on its specialty coffee strategy because of its importance to increase profitability of coffee producers, helping them climb the value chain.

“A challenge of the coffee industry is to keep working on this niche, which must continue growing with highest-quality coffee,” he said.

Vélez recalled that Colombia, with its 100% Colombian coffee program launched in the 1960s, has been a frontrunner in the global specialty coffee industry by betting on differentiation and single origin.

“We, Colombians, were who told the world no blends. Why don’t you taste a 100% Colombian coffee with special characteristics, which stands out from the rest because of its quality and which consumers appreciate to such extent that they are willing to pay a higher price?” he evoked.

Afterwards, in the 70s and 80s, other countries joined and the specialty coffee industry was formally born, leveraged by a wave of new coffee shops, mainly in the west coast of the United States.

And in the context of this booming coffee category, Colombia still has plenty to offer the world because of diversity of its origins, hence the motto of the 9th edition of ExpoEspeciales: “Colombia, Land of Diversity.”

“We are on the right track. We are not wrong when we want to add value to our product on quality matters, we have everything to do and discover. An event like this helps Colombian coffee growers achieve what we’ve promised: profitability,” he said.

Colombia’s improved security conditions have also contributed to development of the specialty coffee industry. Some years ago, few ventured into traveling to coffee regions such as Sierra Nevada, Huila or Nariño, Vélez remarked.

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Global trends open up important opportunities

Global market trends, including millennials’ growing involvement, open up important opportunities for Colombian coffee in general and for Colombian specialty coffees in particular.

This was one of the main lessons of the academic agenda of ExpoEspeciales Café de Colombia.

Growing demand for specialty coffees, including sustainable ones, by millennials, who are increasingly involved with origin, especially in the US market, is a driving force for the industry.

The same occurs with increasing demand for high-quality coffees in countries such as South Korea or in segments such as single-dose coffee, aside from growing demand for naturals and Robustas.

“If we unite all this, we have a quite interesting scenario. Many millennials support consumption aimed at Colombian coffee in many ways. Out-of-home consumption is a driver for these generations,” said Felipe Robayo, Chief Commercial Officer of the FNC.

A greater concentration of production

In the lecture “World Coffee Supply and Demand,” Neil Rosser, head of coffee research at Armajaro Research Ltd (ARL), showed that in recent years coffee production and exports have concentrated in countries such as Brazil, Vietnam and Colombia, which makes supply more vulnerable to climatic fluctuations or shocks.

On the other hand, share of naturals and Robustas has substantially grown at the expense of mild washed coffees, in part due to falling production in Mexico and Central America, which does not prevent countries like South Korea or single-dose coffee manufacturers from betting on higher-quality coffees.

According to Rosser, world coffee demand will continue growing around 2%, which will lead roasters and buyers to pay better prices in order to ensure sustainability of the chain, because producers need to invest in their coffee plantations to increase production, productivity and thus be able to meet demand.

Millennials, a Driving Force of the Industry

The results of a study by the company S&D Coffee and Tea were presented at the academic agenda of ExpoEspeciales, enabling to better understand needs of millennials, young people between 18 and 34 years old who lead out-of-home consumption in the United States and consider themselves experts in food and coffee.

These young people are very aware of innovative coffee preparations, such as cold brew, but only half of them have really tasted them, something that represents great potential sales.

 

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