Required Report - Public distribution

**Date:** 5/28/2008

**GAIN Report Number:** CS8010

CS8010

**Costa Rica**

**Coffee**

**Annual Report**

**2008**

**Approved by:**

![](media/image1.wmf)Justina Torry, Agricultural Attaché

U.S. Embassy

**Prepared by:**

Victor Gonzalez, Agricultural Specialist

**Report Highlights:**

Costa Rica\'s coffee 2007/2008 coffee production increased 5.3% as
compared to the 2006/2007 crop, primarily as a result of higher
productivity. Production is forecast to remain at a similar level during
the 2008/2009 crop year.

Includes PSD Changes: No

Includes Trade Matrix: No

Annual Report

San Jose \[CS1\]

\[CS\]

Table of Contents

[Executive Summary 3](#executive-summary)

[Production 3](#production)

[Table 1: Production, Supply and Distribution: Coffee, Green
3](#table-1-production-supply-and-distribution-coffee-green)

[Consumption 4](#consumption)

[Trade 4](#trade)

[Table 2: Export Trade Matrix, Coffee, Green
5](#table-2-export-trade-matrix-coffee-green)

[Stocks 5](#stocks)

# Executive Summary

As a result of higher international coffee prices during the last few
years, producers have been using more inputs and cultural practices such
as pruning, which has improved output of their plantations. Based on
preliminary data from the Costa Rican Coffee Institute (ICAFE), coffee
production increased 5.6% in 2007/2008 as compared to 2006/2007. Even
though the next crop (2008/2009) is supposed to be the lower year in the
coffee cycle, production is forecast to remain similar to this year's
level because producers have been able to provide better care to their
plantations.

# Production

Based on preliminary data from ICAFE (Costa Rican Coffee Institute),
production increased to 1,882,000 60 kg bags in 2007/2008 (Note: for the
purpose of this report bags refers to 60 kg bags) from 1,782,000 bags in
2006/2007. Better prices for coffee are allowing producers to improve
fertilization and cultural practices. Although it is still early in the
coffee cycle, the 2008/2009 forecast is for the crop to remain similar
to this year's given that farmers have been able to invest in the
maintenance of their plantations. Area planted is not expected to change
significantly over the next few years, as the downward trend has
apparently come to an end, at least under current conditions.

# Table 1: Production, Supply and Distribution: Coffee, Green

<table>
<colgroup>
<col style="width: 10%" />
<col style="width: 7%" />
<col style="width: 9%" />
<col style="width: 9%" />
<col style="width: 7%" />
<col style="width: 9%" />
<col style="width: 9%" />
<col style="width: 7%" />
<col style="width: 9%" />
<col style="width: 9%" />
<col style="width: 9%" />
</colgroup>
<tbody>
<tr class="odd">
<td colspan="11"><p><strong>Costa Rica</strong></p>
<p><strong>Coffee, Green</strong></p></td>
</tr>
<tr class="even">
<td></td>
<td><strong>2007</strong></td>
<td><strong>Revised</strong></td>
<td></td>
<td><strong>2008</strong></td>
<td><strong>Estimate</strong></td>
<td></td>
<td><strong>2009</strong></td>
<td><strong>Forecast</strong></td>
<td></td>
<td><strong>UOM</strong></td>
</tr>
<tr class="odd">
<td></td>
<td><strong>USDA<br />
Official</strong></td>
<td><strong>Post<br />
Estimate</strong></td>
<td><strong>Post<br />
Estimate<br />
New</strong></td>
<td><strong>USDA<br />
Official</strong></td>
<td><strong>Post<br />
Estimate</strong></td>
<td><strong>Post<br />
Estimate<br />
New</strong></td>
<td><strong>USDA<br />
Official</strong></td>
<td><strong>Post<br />
Estimate</strong></td>
<td><strong>Post<br />
Estimate<br />
New</strong></td>
<td></td>
</tr>
<tr class="even">
<td><strong>Market Year Begin</strong></td>
<td></td>
<td>10/2006</td>
<td>10/2006</td>
<td></td>
<td>10/2007</td>
<td>10/2007</td>
<td></td>
<td>10/2008</td>
<td>10/2008</td>
<td>MM/YYYY</td>
</tr>
<tr class="odd">
<td>Area Planted</td>
<td>100</td>
<td>100</td>
<td>98</td>
<td>100</td>
<td>100</td>
<td>98</td>
<td>0</td>
<td>0</td>
<td>98</td>
<td>(1000 HA)</td>
</tr>
<tr class="even">
<td>Area Harvested</td>
<td>93</td>
<td>93</td>
<td>93</td>
<td>93</td>
<td>93</td>
<td>93</td>
<td>0</td>
<td>0</td>
<td>93</td>
<td>(1000 HA)</td>
</tr>
<tr class="odd">
<td>Bearing Trees</td>
<td>384</td>
<td>384</td>
<td>384</td>
<td>384</td>
<td>384</td>
<td>384</td>
<td>0</td>
<td>0</td>
<td>384</td>
<td>(MILLION TREES)</td>
</tr>
<tr class="even">
<td>Non-Bearing Trees</td>
<td>46</td>
<td>46</td>
<td>46</td>
<td>46</td>
<td>46</td>
<td>46</td>
<td>0</td>
<td>0</td>
<td>46</td>
<td>(MILLION TREES)</td>
</tr>
<tr class="odd">
<td>Total Tree Population</td>
<td>430</td>
<td>430</td>
<td>430</td>
<td>430</td>
<td>430</td>
<td>430</td>
<td>0</td>
<td>0</td>
<td>430</td>
<td>(MILLION TREES)</td>
</tr>
<tr class="even">
<td>Beginning Stocks</td>
<td>1315</td>
<td>1315</td>
<td>89</td>
<td>1308</td>
<td>1308</td>
<td>77</td>
<td>0</td>
<td>0</td>
<td>170</td>
<td>(1000 60 KG BAGS)</td>
</tr>
<tr class="odd">
<td>Arabica Production</td>
<td>1792</td>
<td>1792</td>
<td>1782</td>
<td>1850</td>
<td>1850</td>
<td>1882</td>
<td>0</td>
<td>0</td>
<td>1880</td>
<td>(1000 60 KG BAGS)</td>
</tr>
<tr class="even">
<td>Robusta Production</td>
<td>0</td>
<td>0</td>
<td>0</td>
<td>0</td>
<td>0</td>
<td>0</td>
<td>0</td>
<td>0</td>
<td>0</td>
<td>(1000 60 KG BAGS)</td>
</tr>
<tr class="odd">
<td>Other Production</td>
<td>0</td>
<td>0</td>
<td>0</td>
<td>0</td>
<td>0</td>
<td>0</td>
<td>0</td>
<td>0</td>
<td>0</td>
<td>(1000 60 KG BAGS)</td>
</tr>
<tr class="even">
<td>Total Production</td>
<td>1792</td>
<td>1792</td>
<td>1782</td>
<td>1850</td>
<td>1850</td>
<td>1882</td>
<td>0</td>
<td>0</td>
<td>1880</td>
<td>(1000 60 KG BAGS)</td>
</tr>
<tr class="odd">
<td>Bean Imports</td>
<td>0</td>
<td>0</td>
<td>0</td>
<td>0</td>
<td>0</td>
<td>0</td>
<td>0</td>
<td>0</td>
<td>0</td>
<td>(1000 60 KG BAGS)</td>
</tr>
<tr class="even">
<td>Roast &amp; Ground Imports</td>
<td>0</td>
<td>0</td>
<td>0</td>
<td>0</td>
<td>0</td>
<td>0</td>
<td>0</td>
<td>0</td>
<td>0</td>
<td>(1000 60 KG BAGS)</td>
</tr>
<tr class="odd">
<td>Soluble Imports</td>
<td>0</td>
<td>0</td>
<td>0</td>
<td>0</td>
<td>0</td>
<td>0</td>
<td>0</td>
<td>0</td>
<td>0</td>
<td>(1000 60 KG BAGS)</td>
</tr>
<tr class="even">
<td>Total Imports</td>
<td>0</td>
<td>0</td>
<td>0</td>
<td>0</td>
<td>0</td>
<td>0</td>
<td>0</td>
<td>0</td>
<td>0</td>
<td>(1000 60 KG BAGS)</td>
</tr>
<tr class="odd">
<td>Total Supply</td>
<td>3107</td>
<td>3107</td>
<td>1871</td>
<td>3158</td>
<td>3158</td>
<td>1959</td>
<td>1303</td>
<td>1303</td>
<td>2050</td>
<td>(1000 60 KG BAGS)</td>
</tr>
<tr class="even">
<td>Bean Exports</td>
<td>1430</td>
<td>1430</td>
<td>1471</td>
<td>1480</td>
<td>1480</td>
<td>1451</td>
<td>0</td>
<td>0</td>
<td>1500</td>
<td>(1000 60 KG BAGS)</td>
</tr>
<tr class="odd">
<td>Rst-Grnd Exp.</td>
<td>0</td>
<td>0</td>
<td>0</td>
<td>0</td>
<td>0</td>
<td>0</td>
<td>0</td>
<td>0</td>
<td>0</td>
<td>(1000 60 KG BAGS)</td>
</tr>
<tr class="even">
<td>Soluble Exports</td>
<td>0</td>
<td>0</td>
<td>0</td>
<td>0</td>
<td>0</td>
<td>0</td>
<td>0</td>
<td>0</td>
<td>0</td>
<td>(1000 60 KG BAGS)</td>
</tr>
<tr class="odd">
<td>Total Exports</td>
<td>1430</td>
<td>1430</td>
<td>1471</td>
<td>1480</td>
<td>1480</td>
<td>1451</td>
<td>0</td>
<td>0</td>
<td>1500</td>
<td>(1000 60 KG BAGS)</td>
</tr>
<tr class="even">
<td>Rst,Ground Dom. Consum</td>
<td>364</td>
<td>364</td>
<td>318</td>
<td>370</td>
<td>370</td>
<td>333</td>
<td>0</td>
<td>0</td>
<td>335</td>
<td>(1000 60 KG BAGS)</td>
</tr>
<tr class="odd">
<td>Soluble Dom. Cons.</td>
<td>5</td>
<td>5</td>
<td>5</td>
<td>5</td>
<td>5</td>
<td>5</td>
<td>0</td>
<td>0</td>
<td>5</td>
<td>(1000 60 KG BAGS)</td>
</tr>
<tr class="even">
<td>Domestic Use</td>
<td>369</td>
<td>369</td>
<td>323</td>
<td>375</td>
<td>375</td>
<td>338</td>
<td>0</td>
<td>0</td>
<td>340</td>
<td>(1000 60 KG BAGS)</td>
</tr>
<tr class="odd">
<td>Ending Stocks</td>
<td>1308</td>
<td>1308</td>
<td>77</td>
<td>1303</td>
<td>1303</td>
<td>170</td>
<td>0</td>
<td>0</td>
<td>210</td>
<td>(1000 60 KG BAGS)</td>
</tr>
<tr class="even">
<td>Total Distribution</td>
<td>3107</td>
<td>3107</td>
<td>1871</td>
<td>3158</td>
<td>3158</td>
<td>1959</td>
<td>0</td>
<td>0</td>
<td>2050</td>
<td>(1000 60 KG BAGS)</td>
</tr>
<tr class="odd">
<td>Exportable Production</td>
<td>1423</td>
<td>1423</td>
<td>1459</td>
<td>1475</td>
<td>1475</td>
<td>1544</td>
<td>0</td>
<td>0</td>
<td>1540</td>
<td>(1000 60 KG BAGS)</td>
</tr>
</tbody>
</table>

# Consumption

Coffee consumption was 323,000 bags in 2006/2007. Consumption is
expected to increase to 339,000 bags during 2007/2008. The large number
of Nicaraguan immigrants who are gradually increasing their coffee
consumption is believed to be one of the factors behind the higher
consumption. Another factor is the increase in tourism over the last few
years. Many tourists purchase coffee during their visit to Costa Rica to
take home as gifts or for personal consumption. Costa Rica received over
2.0 million tourists in 2007. Per capita coffee consumption is
considered to be high at about 4.5 kg per person per year.

# Trade

Costa Rica exported 1,471,132 bags of coffee in 2006/2007, most of which
went to the United States (52.3%), Germany (11.1%), and Japan (7.8%).
Coffee exports to the United States as a percentage of total exports
have grown significantly in the past few years. Exports are expected to
reach 1,451,000 bags in 2007/2008.

Although coffee has declined to third place in terms of the export value
of agricultural products, it is still an important producer of foreign
exchange. In 2006/2007, the export value of coffee reached \$247.3
million, up from \$221.6 million in 2005/2006, only surpassed by bananas
and pineapples.

According to preliminary data from ICAFE, the average FOB export price
for the 2006/2007 coffee crop was \$169.52 per bag, as compared to
\$159.04 per bag for the 2005/2006 crop. The average export price has
improved since the 2001/2002 crop year.

# Table 2: Export Trade Matrix, Coffee, Green

+----------------------------------+-----------------------------------+
| **Costa Rica**                   |                                   |
|                                  |                                   |
| **Coffee, Green**                |                                   |
|                                  |                                   |
| **60 kg bags**                   |                                   |
+----------------------------------+-----------------------------------+
| Time Period                      | 2006/2007                         |
+----------------------------------+-----------------------------------+
| Exports for:                     |                                   |
+----------------------------------+-----------------------------------+
| U.S.                             | 799,799                           |
+----------------------------------+-----------------------------------+
| Others                           |                                   |
+----------------------------------+-----------------------------------+
| Germany                          | 164,163                           |
+----------------------------------+-----------------------------------+
| Japan                            | 114,275                           |
+----------------------------------+-----------------------------------+
| Belgium                          | 100,084                           |
+----------------------------------+-----------------------------------+
| Italy                            | 87,998                            |
+----------------------------------+-----------------------------------+
| Canada                           | 53,642                            |
+----------------------------------+-----------------------------------+
|                                  |                                   |
+----------------------------------+-----------------------------------+
|                                  |                                   |
+----------------------------------+-----------------------------------+
|                                  |                                   |
+----------------------------------+-----------------------------------+
|                                  |                                   |
+----------------------------------+-----------------------------------+
|                                  |                                   |
+----------------------------------+-----------------------------------+
| Total for Others                 | 520,162                           |
+----------------------------------+-----------------------------------+
| Others not Listed                | 151,171                           |
+----------------------------------+-----------------------------------+
| Grand Total                      | 1,471,132                         |
+----------------------------------+-----------------------------------+

# 

# Stocks

As a result of a methodological change reported by the ICAFE in the
accounting procedures for green coffee, the beginning and ending stock
numbers have been considerably reduced. The new numbers reflect a more
realistic value of the beginning and ending stocks at each particular
crop year.