DTI: Rising global demand to revive Phl coffee industry

CEBU, Philippines - With market opportunities abound for the coffee industry today, the Philippines may have to look again at becoming a top coffee producer or exporter.

The Department of Trade and Industry said the Philippines used to be the world's fourth biggest coffee exporter until market conditions changed from 1989 to 2002 when the country's output went down from 70,000 tons a year to just 23,000 tons.

There is currently an increasing demand for coffee which, DTI said, cannot be met by the current local supply.

Out of the 65,000 metric tons (MT) yearly consumption of coffee, only 30,000 MT come from local supply while the rest is imported from countries such as Indonesia and Vietnam.

Nelia Navarro, new assistant regional director of the Department of Trade and Industry in Region 7, said coffee is one of the priority sectors identified for development under the National Industry Cluster Capacity Enhancement Program, funded by the Japan International Cooperation Agency.

An investment forum on coffee industry was done in Cebu City yesterday, gathering government officials and private sector representatives to discuss the investment opportunities in the industry.

In her presentation, Navarro said the Philippines imports between 75,000 MT to 100,000 MT of coffee from Vietnam and Indonesia annually at a cost of P7-P10 billion.

Local farmers are only capable of producing 25,000 MT of coffee annually. Local demand is now at 75,000 MT and is seen to rise to 100,000 MT in the coming years.

Navarro explained that the declining local coffee production is due to factors such as low buying price, outdated production practices, unproductive coffee trees, diversification into other crops and lack of post-harvest production and processing facilities.

DTI said that one way to support existing and future coffee entrepreneurs is by encouraging farmers to go into coffee production.

The local coffee industry currently employs at least 200,000 Filipinos.

Navarro cited that global coffee consumption has grown at an average 2.4% growth rate since 2011.

Other market opportunities in the sector include the increasing demand for ready-to-drink coffee and herbal coffee mixes, fresh coffee beans among coffee specialty shops and convenience stores and supermarkets becoming channels for coffee consumption.

In 2014, worldwide coffee consumption stood at 149.26 million bags or 8,955 million kilograms of coffee.

Coffee is the world's second most consumed beverage (after water) and the second most traded commodity (after petroleum).

In world trade, it is first among the non-staple and is rated as the fifth most important agricultural product. (FREEMAN)