Coffee Industry

The coffee industry is a major economic activity of several Latin American countries, with consequent influence on patterns of land use, population distribution, and social relations. Native to northeast Africa, coffee was introduced into the Caribbean and the Guianas in the eighteenth century, but it became a major commercial crop only in the nineteenth century, as demand grew in Europe and North America and transportation technology connected remote producing areas to seaports. Coffee requires a frost-free, temperate climate with well-distributed rainfall and fairly rich soils—conditions met by the interior uplands of southeast Brazil as well as the highland areas of Colombia, Central America, southern Mexico, and the larger Caribbean islands. While it is a perennial shrub with a normal life span of twenty to forty years, yields can vary markedly from one year to the next. Aggregate world demand changes only slowly, but abrupt fluctuations in supply, and consequently prices, make coffee a risky business. Nations heavily dependent on coffee for foreign exchange earnings and government revenue have gone through cycles of boom and bust, mitigated somewhat since World War II by a series of international coffee agreements intended to regulate production levels and even out price swings.

In Brazil coffee replaced sugar as the most important export by 1830, holding that position until superseded by soybeans in about 1980. When leaf-rust disease decimated coffee groves in Ceylon and Java in the 1870s, Brazil became the world's primary producer. Coffee spread south and west from Rio de Janeiro, with African slaves providing the labor force on large plantations. That pattern extended into western São Paulo with the construction of railroads connecting the port of Santos to the interior. In the late 1880s, during a decade of high prices and rapid growth, European immigrants replaced slaves as the mainstay of the labor force in São Paulo, just before the final abolition of slavery in 1888. In the first two decades of the twentieth century, Brazil produced three-quarters of the world's coffee, with the state of São Paulo accounting for fully half the world's supply. A bumper crop in 1906 of 20 million 132-pound bags, the highest recorded in Brazil for many years, prompted a government program of price supports and market controls that became a recurring feature of Brazilian coffee policy. During the 1930s such policies included the purchase and destruction of large quantities in the face of depressed world prices. The coffee trade brought mass immigration from Europe, high government revenues, and complementary economic activity—all fundamental in the eventual emergence of São Paulo as South America's largest industrial center.

Colombia first exported small quantities of coffee in 1835, and by the early twentieth century was exporting about 500,000 bags per year (at a time when Brazilian exports averaged some 12 million bags annually). The formation of the National Federation of Coffee Growers in 1927 institutionalized a system whereby the coffee of many medium and small farms was marketed through what became a powerful political and financial organization controlling the country's principal export. By specializing in higher-quality varieties and astute marketing, Colombia's production expanded steadily after World War II, so that by the 1980s the aggregate value of its coffee exports rivaled that of Brazil (whose large internal market absorbs about half of its total production).

Cultivation began in the highland areas of Central America also in the nineteenth century, as newly consolidating national elites encroached on indigenous village lands through privatization laws and usurpation, and many formerly autonomous peasants were forced or drawn into the labor force of the new export sector. German planters and trading firms were important from the 1870s to World War I in some areas of Guatemala and Chiapas, Mexico. Costa Rica's coffee sector, like that of Colombia, has had a greater proportion of small and medium-sized producing units than was the case in Guatemala and El Salvador, where larger plantations have been the norm. Although coffee became dominant in the profile of exports in several countries, none rivaled Brazil in total production, and the vagaries of Brazil's annual crop continued to influence world price levels. Since World War II, production in central Africa also expanded, led by Ivory Coast, Uganda, and Kenya, so that by the 1980s Latin America accounted for 55 to 60 percent of world exports, down from nearly 90 percent in the early 1900s.

Since the 1980s, increased competition from African and Asian producers has brought down the prices paid to growers. One of the ways coffee estates have combated low prices is through specialization and quality. The fair trade movement, an effort to guarantee workers a fair wage and producers a fair price, has brought a higher premium and better quality. Increasingly, coffee marketers are creating brands based on the unique qualities of coffees grown in particular regions.

See alsoCoffee, Valorization of (Brazil); Colombia, Organizations: National Federation of Coffee Growers.

BIBLIOGRAPHY

Bergad, Laird. Coffee and the Growth of Agrarian Capitalism in Nineteenth-Century Puerto Rico (1983).

Bergquist, Charles. Coffee and Conflict in Colombia (1986).

Fisher, Bart S. The International Coffee Agreement: A Study in Coffee Diplomacy (1972).

Holloway, Thomas H. Immigrants on the Land: Coffee and Society in São Paulo, 1886–1934 (1980).

Palacios, Marco. Coffee in Colombia, 1850–1970 (1980).

Roseberry, William. Coffee and Capitalism in the Venezuelan Andes (1983).

Stein, Stanley. Vassouras, a Brazilian Coffee County, 1850–1900 (1957).

Wickizer, Vernon D. The World Coffee Economy, with Special Reference to Control Schemes (1943).

Winson, Anthony. Coffee and Democracy in Modern Costa Rica (1989).

                                Thomas H. Holloway