Production for MY 2012/13 is estimated to be a good crop at about 843,000 bags, compared to the 613,000 bags of MY 2011/12.
THIS REPORT CONTAINS ASSESSMENTS OF COMMODITY AND TRADE ISSUES MADE BY
USDA STAFF AND NOT NECESSARILY STATEMENTS OF OFFICIAL U.S. GOVERNMENT
Required Report - public distribution
GAIN Report Number: VE1206
David W. Cottrell
Production for MY 2012/13 is estimated to be a good crop at about 843,000 bags, compared to the
613,000 bags of MY 2011/12. Imports of coffee are expected to continue. Estimated imports for
2012/13 are 604,000 bags.
The implementation of price controls in 2003 hastened the decline of the coffee sector in Venezuela,
which had already been under pressure from low output prices, difficult weather and challenging
government economic policies. Recent increases in prices and the new ability to have 30 percent of
production for non-price controlled products should help remaining producers fare better. Production
for MY 2012/13 is estimated to be a good crop at 843,000 bags, compared to the 613,000 bags last MY
2011/12 (due to excessive rains in the coffee areas). Venezuela began importing large amounts of
coffee in 2009 and it now imports more than half of the coffee that it consumes. Estimated imports for
MY 2012/13 are 604,000 bags. The government raised prices in November 2011 to encourage
producers to increase production.
Most of the coffee is grown in the west and northern mountains area (Andean range and Cost range),
particularly in the states of Táchira, Merida, Trujillo, Lara, Portuguesa, Monagas and Sucre. Planted
area remains at about 200,000 hectares but productivity has been decreasing. Coffee plantations are
distributed over a wide range of altitudes and regions and so coffee can be harvested during ten months
of the year.
Coffee harvests are done by hand between October and late March. The lack of labor availability is a
major problem and contributes directly to decreases in production and yields. Many producers without
labor switch to another crop if possible or try raising animals.
Other factors that constrain production are the farm-gate and retail price controls, lack of access to
fertilizers, lack of investment due to inability to make profits and a fear of government takeovers.
According to the National Producers Federation (Fedeagro), heavy and excessive rains in certain coffee
areas reduced the October 2010-March 2011 harvest to a record low 613,000 bags (800,000 quintals).
Fedeagro projects that the MY 2011/12 crop could reach about 843,000 bags (1,100,000 quintals) if rain
does not damage the flowering. This crop year also corresponds to the high productivity year in
Venezuela’s biennial cycle. Production for MY 012/13 is forecasted at 881,000 bags (1,150,000
quintals) assuming timely and appropriate public financing, fair price reviews, and good weather
The expropriation of the company Café Fama de América in 2009 and the acquisition of a 50 percent of
the stakes in Marcelo & Rivero (Café Madrid) in 2010 put the Venezuelan Government in control of 80
percent of the coffee processing industry, with the remaining 20 percent in the hands of small private
Total domestic coffee consumption for 2010/11 was 1,280,000 bags. Fedeagro estimates MY 2011/12
consumption to slightly increase to 1,285,000 bags and then again increase to 1,290,000 bags in MY
2012/13. This increase in consumption is linked to better access of the low-income people to the basic
food basket products through the government food commercial chains, which commercialize food
products at lower prices. Coffee is included in the basic food basket.
Since 2009, production has failed to meet demand and the Government has had to import large amounts
of coffee. There is also a shortage of soluble and decaffeinated coffee in the grocery stores, most of
which has always been imported. This is only a small niche market because Venezuelans prefer roasted
The Bolivarian Government is the sole importer of coffee. Since 2009, Venezuela has had to import
large quantities of green coffee to supply both coffee roasters and the domestic market.
Fedeagro believes the price controls on coffee continue to undermine the sector's viability. They
estimate that during MY 2010/11, over 622,000 bags (811,000 quintals) were imported (mainly from
Brazil and Nicaragua). They report that the imported coffee is of poor quality with small and uneven
grain size and low in aroma.
Coffee imports are expected to continue and should start in June after the domestic crop is fully
collected. Imports in MY 2011/12 may decrease to 604,000 bags (787,000 quintals). The Government
recently announced a “Socialist Coffee Plan” designed to expand production capacity and lower
imports. If successful implemented, imports for MY 2012/2013 could further drop to 398,000 bags.
The Venezuelan coffee market is now largely domestic and no significant exports have been recorded
since 2009. There are unofficial shipments to Colombia because of higher prices available there and we
understand that shipments of both green coffee beans and roasted ground coffee have increased.
Estimates are that about 100,000 bags moved out in MY 2010/2011 and another 100,000 bags are
expected to leave the country in MY 2011/2012.
Coffee, like many other food products in Venezuela, is under a controlled price regime established in
2003. Farm-gate prices for green coffee and the retail prices for ground coffee were raised in November
2011 (the first time in almost 2 years). According to the Official Gazette N° 39.058, the price of both
coffee beans and ground coffee is now fixed at 18.45 bolivars per kilo (compared to the former price of
11.85 bolivars per kilo).
The price of the Good Washed “A” went from to 1,200 bolivars (from 747 bolivars) per quintal. The
price of green coffee Good Washed “B” rose to 1,080 bolivars (from 691 bolivars) and Good Washed
“C” increased to 980 bolivars (from 623 bolivars).
Many small farmers and processors still claim that the prices set by the government are not high enough
to cover production costs or provide an adequate return. A new regulation recently published at the
Official Gazette allows the coffee industry to have up to 30 percent of their production in non-regulated
products. This could represent a better return for the industry members that want to make gourmet or
flavored coffees that are not price controlled.
Production, Supply and Demand Data Statistics:
Coffee, Green Venezuela 2010/2011 2011/2012 2012/2013
Market Year Begin: Oct 2010 Market Year Begin: Oct 2011 Market Year Begin: Oct 2012
USDA Official New Post USDA Official New Post USDA Official New Post
Area Planted 0 200 0 200 200
Area Harvested 0 180 0 180 180
Bearing Trees 0 500 0 500 500
Non-Bearing Trees 0 30 0 30 30
Total Tree Population 0 530 0 530 530
Beginning Stocks 380 380 315 210 242
Arabica Production 690 613 800 843 881
Robusta Production 0 0 0 0 0
Other Production 0 0 0 0 0
Total Production 690 613 800 843 881
Bean Imports 390 620 250 598 383
Roast & Ground Imports 0 1 0 1 5
Soluble Imports 75 1 100 5 10
Total Imports 465 622 350 604 398
Total Supply 1,535 1,615 1,465 1,657 1,521
Bean Exports 0 100 0 100 80
Rst-Grnd Exp. 0 0 0 0 0
Soluble Exports 0 0 0 0 0
Total Exports 0 100 0 100 80
Rst,Ground Dom. Consum 1,120 1,280 1,000 1,285 1,290
Soluble Dom. Cons. 100 25 125 30 30
Domestic Use 1,220 1,305 1,125 1,315 1,320
Ending Stocks 315 210 340 242 121
Total Distribution 1,535 1,615 1,465 1,657 1,521
1000 HA, MILLION TREES, 1000 60 KG BAGS