The price that coffee growers can sell their crops for can be very unstable, in fact recently the price has dropped near to the lowest in 13 years. Despite this, farmers in Brazil have found ways to invest in the future of their coffee industry by expanding their operations and vastly improving efficiency, keeping them profitable in even the current challenging market.
How is this possible?
Brazilian farmers have been focussing their efforts on mechanising their processes and using fertilisation and water irrigation to manage increasingly larger areas with more efficiency, aiming to make themselves as cost effective as possible. For example, Rodrigo de Freitas Silva’s coffee farm has increased to 220 hectares from 12.5 and has managed to double his yields. By maximising yield whilst minimising production costs, Silva has been able to remain profitable, and has plans for further expansion and improving yields even more. He predicts that his farm will collect 10,000 bags of arabica beans in 2020, which is close to triple this year’s number.
How will this impact the global market?
Not everywhere in the world is in as good a position as Brazil however, with many coffee growing regions failing to make a profit. Without being able to streamline their production processes, they are forced to sell their beans at a price that doesn’t meet the cost of production. Many of these coffee farmers also have limited access to credit to allow them to get through the tougher periods as well, which could result in them being forced out of the market altogether.
As Brazil keeps reinvesting in improving efficiency and maximising yields, if the rest of the world struggles to keep up we may find that sourcing coffee from other regions becomes more and more difficult to do. Brazil produces some of the very best coffees on the planet, but one of the things that makes coffee truly special is the wide array of different flavours available from different regions around the world. If the price of coffee remains this volatile and farmers struggle to turn a profit, the whole coffee industry could end up suffering.
This just goes to show how vital it is in any industry to focus on optimising the efficiency of your product to maximise profits. That’s why WMF develops coffee machines with cutting edge automation technology, helping you to serve customers quickly and keep production costs down. From bean-to-cup machines like the WMF 9000 S+ which has a maximum output of 350 coffees per hour, to the WMF espresso which combines automated grinding and tamping with classic hand made beverages, there’s something to suit any business.
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