**<u>Table II.1 Estimated Shares of Global Coffee Production of Selected Countries</u>**

||1997|1998|1999|2000|2001|2002|
|---|---|---|---|---|---|---|
|Total Production<br>‘000 bags|96,213|106,055|114,418|112,404|111,282|117,689|
|Brazil|23.6%|32.6%|28.3%|28.6%|30.9|40.1%|
|Columbia|12.7%|10.4%|8.3%|9.4%|10.8%|9.6%|
|VietNam|7.2%|7.0%|10.2%|13.2%|11.7%|7.6%|
|Indonesia|8.1%|8.0%|4.7%|6.0%|6.9%|5.0%|
|México|5.0%|4.8%|5.4%|4.3%|3.8%|3.4%|
|Guatemala|4.4%|4.6%|4.4%|4.4%|3.3%|2.7%|
|CostaRica|2.6%|2.3%|2.1%|2.0%|2.0%|1.8%|
|Honduras|2.7%|2.1%|2.6%|2.4%|4.5%|4.0%|
|Nicaragua|1.1%|1.0%|1.3%|1.4%|1.0%|0.7%|
|**Domincan Republic**|**1.0%**|**0.4%**|**0.6%**|**0.4%**|**0.4%**|**0.6%**|

Source: ICO website. Note : This is only a list of « selected countries.

To demonstrate the ever changing conditions in international coffee markets, here is an excerpt from a market update report on the international coffee situation in February 2003: The March contract for coffee rose 1.35 cents to 65.30 cents a pound (US$65.30/qq), as traders focused on a smaller Central American crop and estimates that Brazil's 2003-04 crop, to be harvested June through August, will be at least a third smaller than the last giant crop of 51.7 million 60-kilogram (132-pound) bags. The ICO said that combined 2002-03 output in Mexico and Central America will be down 21%-24% on the year. Vietnam's 2002-03 crop is at least 25% smaller, and Indonesia's is off 24%. Brazilian coffee from the huge 2002-03 crop is ample, but of mostly lesser quality. Quality beans needed by roasters in North America and Europe for blends and to meet upscale demand are already in short supply. Because of crop problems in Guatemala, Costa Rica and Ethiopia, specialty-coffee roasters are seeking out quality supplies. The new Central American crops were reduced by adverse weather and less attention from growers because of recent low prices. (Buchanan, 2003) Flat prices and increasing competition in specialty markets makes the future of the coffee industry uncertain. International market prospects for Dominican coffee producers and the entire coffee sector should improve (from a very bad situation) in the short term, but long-run prospects for a return to conditions of the mid-1990s are not expected. An opportunity exists to expand exports to markets demanding higher quality coffee, but these markets are becoming more saturated as competition increases.

# **B. Recent Cocoa Prices, Production and Exports**<sup>24</sup>

Like international coffee markets, the international cocoa market is experiencing a “crisis”, however the “cocoa crisis” is characterized by 30-year high prices (about $1880/MT) and significant declines in global supply. The latter is due to political turmoil in Cote d’Ivoire, the world’s major producer and exporter<sup>25</sup> , and to outbreaks of diseases, such as witch’s broom. In

> 24 This section is drawn mostly from the FAO’s Cocoa Commodity Notes, which was last updated March 2003. see the FAO website: fao.org

> 25 Cote d’Ivoire accounted for about 45% of global cocoa production during the 1990s.  For sake of comparison, during the 1990s, Dominican Republic’s share of global cocoa production was less than 2%, and the average production was about 50,000 MT

26