Showing posts with label global economy. Show all posts
Showing posts with label global economy. Show all posts

Friday, October 10, 2008

why the coffee market itself is a very competitive sector

Since coffee is by far the most popular drinks of our times, without any known rival so far, it goes without saying that the coffee market itself is a very competitive sector. With the huge number of coffee brands, companies have to come up not with just good prices, but with quality guarantees to prove that their coffee is well-flavored and tasty. Statistics show that there is only one commerce domain more active than coffee market and it is that of oil; consequently one can hardly imagine the extent of the transactions and the number of figures for the profits that result from the coffee market.

From time to time, crisis periods appear on the coffee market, related to poor bean quality, the creation of stocks or oversupplies, not to mention the very low coffee prices. All these elements threaten to affect the lives of those who depend on coffee cultivation for a living, the coffee farmers or producers. Furthermore, pollution has a heavy word to say in the evolution of the coffee-growing areas where entire ecosystems could be endangered; while the coffee consumer is actually unaware of the strive that is going on behind the morning coffee he or she prepares.

In global economy, the coffee market is among the fewest domains where small producers dominate trade commodities; statistics show that more than 75% of the world's coffee production comes from little farms that are entirely independent in terms of harvesting and supplying. Every time, coffee prices drop, there are farmers who come to abandon their coffee fields, moving to different sectors of activity. Such changes on the coffee market leads to instability within many communities as well as to shifts in the evolution of national economies since a part of the investments in the sector are lost.

Though the demand on the coffee market usually remains stable, there are times when fluctuations occur here as well. However, even during the times when the coffee prices drop, there is no relevant price reduction for the coffee products on the market due to the same little fluctuation in the demand. If people need just as much coffee as before, why would anyone try to make it cheaper: businesses profit from this constancy in the field and have profit changes unaffected by such fluctuations. Such transactions profitable only for some parts of the trading process are not suspected by the small farmers who have no idea about the coffee price in London or Sydney.







Monday, September 1, 2008

a look at the major difference between arabica and robusta coffee plant

Though generally referred to as a coffee tree due to the huge dimensions it can get to, the coffee plant is an evergreen specific to the warm subtropical areas all over the world. Though there are quite many species varieties, there are only two types of coffee plant that global economy exploits on a large scale: they are Arabica and Robusta, the two coffee kinds on which international commerce depends.

Though these two varieties of the coffee plant are used, Arabica leads beyond any trace of a doubt as it is responsible for 75% of the world coffee production, whereas Robusta only gives 20%. This huge difference comes from the coffee plant specificity of each of these subspecies. The beans produced by Robusta coffee plant are inferior in what the quality is concerned due to the higher level of caffeine that also influences taste.

Thus, Robusta coffee is a little bitter than Arabica and darker too; nevertheless, certain communities also depend on this coffee variety for economic survival. To make harvesting pretty easy or comfortable, the height of the coffee plant is kept under control on plantations, and it doesn't get to grow as high as ten meters as it would normally do, if left wild.

Another major difference between Arabica and Robusta coffee plant lies in pollination specificity: Arabica for instance is self fertilizing whereas Robusta depends on cross pollination. The full development of the coffee fruit, the delicious bean we depend on for our morning coffee, takes about thirty to thirty-five weeks after which it's time to harvest. As for the growth period of the coffee plant until it becomes fertile it ranges between four and five years.

For proper development, the coffee plant depends on a pretty high level of rainfall every year; it is sensitive to cold, however, it will not die because of accidentally cooler weather. The dependence on warm temperature makes it impossible to cultivate the coffee plant in Europe or in other similar parts of the world, where a temperate climate provides incompatible environments.

One great surprise came when a naturally decaffeinated type of coffee plant was discovered in Brazil, with a lot better flavor than the no-caffeine coffee brands manufactured at present. Flavor is usually lost because caffeine is extracted with the help of solvents, while if it be completely absent from the chemical composition of the plant, the flavor would remain untouched. Cultivating this type of coffee plant would mean a true revolution in the business, and things are not far from moving in that direction.











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