Average imports of roasted and
soluble coffee of the seven leading importers and the origin of those imports
are shown in the figures below:
These seven countries account for the bulk of the imports of both roasted and soluble coffee. And as can be seen, with the exception of the United States, imports of roasted coffee from producing countries barely register on the chart. Imports of roasted coffee into the United States have been increasing significantly over the last five years, with a noticeable increase in imports of roasted coffee from Colombia, Mexico, the Dominican Republic and Brazil. X Imports of soluble coffee from producing countries are clearly more significant and form a larger share of the trade in the United States, Germany, Japan and the United Kingdom.The average price paid for soluble coffee by the seven countries is compared with the ICO composite indicator in the figure below. The import price is expressed as the price of the green bean equivalent to facilitate comparison. Generally the import price tracks the indicator, sometimes at a lower level and at other times at a premium. However, because of intense competition the value added, on an FOB basis, is less than popularly supposed. In the calculation, the volume of soluble coffee has been transformed into the green bean equivalent by applying the ratio of 1:2.6 (soluble coffee:GBE.Export
unit value statistics show that the prices of Brazilian soluble are lower than
both the New York market prices for Brazilian green coffee and, at times, the
London market prices for robustas. Colombian prices correspond more closely
with New York prices, although the unit value of exports of Colombian soluble
(an aggregate of spray dried and freeze dried) remains for the most part just
slightly above the quoted green coffee price. One of the reasons for producing
countries to continue with this is that coffee which is transformed in the
country of origin does not have to possess all quality characteristics of
coffee which can be exported in green form. The transformation into soluble may
therefore allow the use of lower grades. Nevertheless the value added by the
manufacture of soluble at origin is likely to be, at best, marginal and a run
of low prices may not allow the speedy recovery of costs of new installations.
Roasted coffee (see figure below) sells at a premium over both the ICO
composite indicator and the New York market for Other milds, but this trade is
more specialized and export prices may include the provision of retail packs.
Nevertheless, the trade remains negligible.