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Economics of Crops in Developing Countries No 1 The Economicso f cropsi ndevelopin g countriesN o1 Theeconomic s of coffee The series 'Economics of crops in developing countries' is the result of a research project undertaken by the Department of Development Economics of the Agri­ cultural University, Wageningen. The monographs in this series are intended to fill the gap between agronomic documentation and aggregate data on production andtrade . Thefollowin g titlesar ei n preparation: 2.Th eeconomic s ofoi lpalm : H.A.J. Moll 3.Th eeconomic so f maize:J .A . Kool 4.Th e economics of cotton. my 53SO08 fly1 Economicso fcrop si ndevelopin gcountrie sN o1 Theeconomic so fcoffe e J.d eGraaf f PudocWageninge n 1986 15 o 2HO U^) Ir J. de Graaff isa n agricultural economist, who graduated from the Agricultural Universi­ ty, Wageningen, in 1974. He worked for the Food and Agriculture Organization of the United Nations in Tunisia, Kenya and Jamaica and at the headquarters in Rome. He was employed by the Department of Development Economics of the Agricultural University from 1982 to 1984. In 1984, he joined the staff of the Royal Tropical Institute in Amster­ dam.Sinc e 1979,h eha scarrie d out severalconsultanc y assignmentsi nAfric a and Asia. CIP ISBN 90 220090 09 © Centre for Agricultural Publishing and Documentation (Pudoc), Wageningen, the Netherlands,1986 . No part of this publication, apart from bibliographic data and brief quotations embodied in critical reviews, may be reproduced, re-recorded or published in any form including print, photocopy, microfilm, electronic or electromagnetic record without written permission from thepublishe r Pudoc, P.O. Box4 ,670 0A AWageningen , theNetherlands . , BlBliOTriFFK TV •; 1ANDBOITV , , , uoot Contents 12 Foreword 13 Preface 14 Acknowledgments 16 Abbreviations 19 PartI 21 1 Introductiont ocoffe e 21 1.1 General aspects 21 1.1.1 Botany 21 1.1.1.1 Classification 22 1.1.1.2 Morphology 23 1.1.1.3 Propagation 23 1.1.1.4 Chemical composition 24 1.1.2 Origin anddistributio n 26 1.1.3 Usesan d competitive product 29 1.2 Ecology 29 1.2.1 Climatic requirements 30 1.2.2 Soil requirements 30 1.2.3 Suitablezone sfo r coffee 32 1.2.4 Cropswit h similarecologica l requirements 32 1.3 Production 32 1.3.1 Production systems 34 1.3.2 Comparison withproductio n systemso fte a and cocoa 37 1.3.3 Production stages 37 1.3.3.1 Land preparation f38 1.3.3.2 Planting 38 1.3.3.3 Cultivation practices 40 1.3.3.4 Harvesting 41 1.3.4 Pest and disease control 41 1.3.5 Production levels 42 1.4 Processing 45 1.4.1 Initial processing 46 1.4.1.1 Wet process (production ofwashe d coffee) 46 1.4.1.2 Dryproces s (production ofunwashe d ornatura l coffee) 47 1.4.2 Curingo f coffee 47 1.4.2.1 Hulling 47 1.4.2.2 Grading 47 1.4.2.3 Baggingan dstorag e 48 1.4.2.4 Roasting 49 1.4.3 Instant coffee 49 1.4.4 Decaffeination 50 1.5 Services 50 1.5.1 Supporting servicest ofarmer s 53 1.5.2 Marketingi nproducin g countries 57 1.5.3 Research 58 1.6 International trade and consumption 58 1.6.1 International trade 63 1.6.2 International agreements incoffe e trade 66 1.6.3 Worldwide consumption of coffee 67 References 69 2 Comparativeanalysi s 69 2.1 Framework 69 2.1.1 Scopeo fanalysi s 70 2.1.2 Selection ofcountrie s 72 2.2 Basicfactor s incoffe e cultivation 72 2.2.1 Historical development andecolog y 75 2.2.2 Production factors 77 2.3 Production systemsan dproductio n costs 79 2.3.1 Production systems 81 2.3.2 Production costs 83 2.3.3 Alternative cropsan dothe r agricultural enterprises 83 2.4 Processing, marketing andservice s 83 2.4.1 Processing and marketing channels 86 2.4.2 Marketsan d marketing functions 87 2.4.3 Supporting services 88 2.5 Export earnings, pricing and taxation 88 2.5.1 Position onth eworl d market 91 2.5.2 Pricing and taxation 92 2.5.3 Distribution ofincom efro m coffee 95 2.6 Conclusions 97 References 99 Part II 101 3 Coffeei nBrazi l 101 3.1 Background 103 3.2 Ecology 105 3.3 Thecoffe e sector 105 3.3.1 History 107 3.3.2 Recent developments 109 3.3.3 The organization 110 3.4 Production 110 3.4.1 Production units andfarmin g systems 112 3.4.2 Production stagesan dproductio n costs 117 3.4.3 Yieldsan d returns 117 3.5 Processing 117 3.5.1 Milling and roasting 118 3.5.2 Soluble-coffee industry 119 3.6 Marketing 119 3.6.1 Marketing channels and functions 120 3.6.2 Pricing, taxation and marketing margins 121 3.6.3 Export anddomesti c consumption 123 3.7 Supporting services 123 3.7.1 Research and extension services 124 3.7.2 Credit and subsidies 125 3.7.3 Input supply 126 3.8 Summary and economic parameters 127 References 129 4 Coffee inColombi a 129 4.1 Background 129 4.2 Ecology 133 4.3 Thecoffe e sector 133 4.3.1 History 135 4.3.2 Recent developments 137 4.3.3 Organization 138 4.4 Production 138 4.4.1 Production unitsan d farming systems 140 4.4.2 Production stagesan d production costs 140 4.4.2.1 Establishment 142 4.4.2.2 Productive period 144 4.4.3 Yieldsan d returns 145 4.5 Processing 146 4.6 Marketing and pricing 146 4.6.1 Marketing channels and marketing functions 147 4.6.2 Pricing and taxation 148 4.6.3 Export and domestic consumption 149 4.7 Supporting services 149 4.7.1 Research and extension services 150 4.7.2 Provision of credit 150 4.7.3 Input supply and cooperative development 151 4.7.4 Diversification programme 151 4.8 Summary and economic parameters 153 References 155 5 Coffee inCost a Rica 155 5.1 Introduction 155 5.2 Ecology 159 5.3 The coffee sector 159 5.3.1 History 160 5.3.2 Recent developments 162 5.3.3 Organization 163 5.4 Production 163 5.4.1 Production units 164 5.4.2 Production systems 166 5.4.3 Production cost 168 5.4.4 Yields and returns 168 5.5 Processing 168 5.5.1 Processing factories 170 5.5.2 Processing costs 171 5.6 Marketing and pricing 171 5.6.1 Marketing channels and marketing functions 172 5.6.2 Marketing margins and taxation 172 5.6.3 Export and domestic consumption 175 5.7 Linkages and supporting services 175 5.7.1 Research and extension services 176 5.7.2 Provision of credit and payment regulations 176 5.7.3 Input supply 177 5.7.4 Use of byproducts 177 5.8 Summary and economic parameters 178 References 180 6 Coffee in Kenya 180 6.1 Background 180 6.2 Ecology 184 6.3 The coffee sector 184 6.3.1 History 184 6.3.2 Recent developments 186 6.3.3 Organization 187 6.4 Production 187 6.4.1 Production unitsan dfarmin g systems 190 6.4.2 Production stagesan d production costs 195 6.4.3 Yieldsan d returns 195 6.5 Processing 196 6.6 Marketing 196 6.6.1 Marketing channels and functions 198 6.6.2 The roleo fcoffe e cooperatives 199 6.6.3 Marketing marginsan dcost s 200 6.6.4 Export and domestic consumption 202 6.7 Supporting services 202 6.7.1 Research 203 6.7.2 Credit and input supply 204 6.7.3 Extension and training 205 6.8 Summary and economic parameters 206 References 208 7 Coffee inRwand a 208 7.1 Background 208 7.2 Ecology 209 7.3 Thecoffe e sector 209 7.3.1 History 211 7.3.2 Recent developments 212 7.3.3 Organization 213 7.4 Production 213 7.4.1 Production unitsan dfarmin g systems 215 7.4.2 Production costs,yield san d returns 217 7.5 Processing 218 7.6 Marketing 218 7.6.1 Marketing channels and functions 219 7.6.2 Pricing and taxation 220 7.6.3 Export and domestic consumption 221 7.7 Supporting services 221 7.7.1 Research and extension services 222 7.7.2 Credit and input supply 223 7.8 Summary and economic parameters 224 References 226 8 Coffee inCameroo n 226 8.1 Background 226 8.2 Ecology 10 230 8.3 The coffee sector 230 8.3.1 History 230 8.3.2 Recent developments 231 8.3.3 Organization 233 8.4 Production 233 8.4.1 Production unitsan dfarmin g systems 234 8.4.2 Production stagesan d production costs 237 8.4.3 Yieldsan d returns 238 8.5 Processing 240 8.6 Marketing 240 8.6.1 Marketing channels and functions 242 8.6.2 The roleo f coffee cooperatives 243 8.6.3 Marketing costsan d margins 246 8.6.4 Export and domestic consumption 247 8.7 Supporting services 247 8.7.1 Research and extension services 248 8.7.2 Input supply and credit 249 8.8 Summary and economic parameters 250 References 252 9 Coffee inIvor yCoas t 252 9.1 Background 252 9.2 Ecology 255 9.3 Thecoffe e sector 255 9.3.1 History 256 9.3.2 Recent developments 258 9.3.3 The organization 259 9.4 Production 259 9.4.1 Production unitsan d farming systems 261 9.4.2 Production stagesan d production costs 264 9.4.3 Yields and returns 264 9.5 Processing 266 9.6 Marketing 266 9.6.1 Marketing channels 266 9.6.2 Marketing functions 267 9.6.3 Marketing marginsan d taxations 269 9.6.4 Export and domestic consumption 270 9.7 Supporting services 270 9.7.1 Research 271 9.7.2 Extension services 272 9.7.3 Credit andinpu t supply 272 9.8 Summary and economic parameters 273 References 11 275 10 Coffee inIndonesi a 275 10.1 Background 277 10.2 Ecology 278 10.3 The coffee sector 278 10.3.1 History 279 10.3.2 Recent developments 281 10.3.3 Organization 282 10.4 Production 282 10.4.1 Production unitsan dfarmin g systems 283 10.4.2 Production stages 284 10.4.3 Production costsan d returns 286 10.5 Processing 286 10.6 Marketing 286 10.6.1 Marketing channels 287 10.6.2 Marketing functions 288 10.6.3 Pricing and taxation 288 10.6.4 Marketing costsan d margins 289 10.6.5 Export and domestic consumption 291 10.7 Supporting services 292 10.8 Summary and economic parameters 293 References Foreword In 1982, the Department of Development Economics of the Agricultural Uni­ versity in Wageningen embarked upon a project aimed at the production of a se­ ries of monographs on the economics of tropical and subtropical crops.
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