12 Countries That Produce the Best Coffee in the World
In this piece, we will take a look at the twelve countries that produce the best coffee in the world. For more companies, head on over to 5 Countries That Produce the Best Coffee in the World.
Coffee is one of the most popular beverages in the world, and one with a long history, with the first mention of the drink tracing its way back to the tenth century CE. Since then, it has been used for its medicinal properties that helped with concentration and as a social activity to allow people to congregate at coffee shops. Global coffee consumption is booming, and according to estimates by the International Coffee Organization (ICO) consumption in the twelve months that ended in September 2022 is slated to sit at a whopping 170.3 million bags. However, despite this, a global coffee shortfall will continue, with a production of 167.2 million bags expected to stay behind the consumption.
Automation and industrial engineering are changing the way farmers plant, monitor, and harvest their products, and the coffee industry is no exception. For instance, coffee farmers in Brazil are employing automation throughout the planting and harvesting processes. The machines that harvest coffee use the global positioning system (GPS) to allow farmers to keep track of the equipment and cameras to analyze the plant. Of course, this is just rudimentary technology compared to today's standards, and leading edge research into coffee production is now studying hyperspectral imaging for a variety of purposes. For instance, researchers have shown that a visible near (VIS-NIR) infrared sensor can be used to map out coffee plants to inspect them for insect damage.
What's more is that this research also uses algorithms to let computers pick out the relevant damage patterns through just three image bands, with the initial subset of bands being selected through principle component analysis (PCA) - a basic type of machine learning. The same imaging processes can also be used to map out different coffee bean varieties, removing a large burden from farmers who previously had to crush the bean to find out its type and kind. In fact, coffee bean spectral imaging has been shown to achieve an 80% accuracy in identifying the right kind of bean. The use of technology to aid farmers with their quality gauging needs has also been commercialized, with Colombian firm Demetria providing farmers the tools to map out their bean profile with infrared light and then determine which bean they have come across through using an artificial intelligence platform. The company also provides technology that allows farmers to sift out high quality coffee bean stems by using handheld gadgets. The firm raised $3 million in 2021 to allow it to develop an automated platform for mapping out coffee beans based on acidity, flavor, and aroma by creating digital footprints.
As far as the overall market goes, ICO estimates that global coffee exports stood at 9.7 million bags in October this year, marking a drop from the 9.87 bags exported in October 2021. According to Expert Market Research, the global coffee market was worth $114 billion in 2020 and it will grow at a compounded annual growth rate (CAGR) of 4.8% between 2018 to 2022. Out of the different product categories, the research firm estimates that instant coffee will hold the greatest market share, not only because it is easy and less time consuming to prepare, but also because it is good for metabolism and contains relatively lower amounts of caffeine. The research firm further outlines that increasing awareness of coffee's health benefits and a shift toward sustainable innovations for delivery will stimulate growth. Leading coffee producers and sellers are Starbucks Corporation (NASDAQ:SBUX), Monster Beverage Corporation (NASDAQ:MNST), McDonald’s Corporation (NYSE:MCD), The Kraft Heinz Company (NASDAQ:KHC), The J.M. Smucker Company (NYSE:SJM), and Nestlé S.A. (SWX:NESN.SW).
Our Methodology
We used global trade data segregated on the basis of the harmonized tariff schedule to see which countries export the best coffee. Overall, this data agrees with the ICO's assessment that coffee exports are declining, with the $36 billion of exports in 2021 falling by $144 million annually.
Countries That Produce the Best Coffee in the World
12. Netherlands
Coffee Exports in 2021: $906 million
The Netherlands is a European country with a $10.6 billion coffee market in 2020. The largest portion of the Dutch coffee market is the filtered coffee market with coffee capsules coming in second place. Additionally, the Dutch coffee market is expected to grow to $13 billion in 2027. The country is also known for its popular coffee shops, which are known globally for allowing visitors to legally consume cannabis in addition to coffee as well. Perhaps the most famous Dutch coffee brand is JDE Peet's N.V. (AMS:JDEP.AS)'s Douwe Egberts coffee. Douwe Egberts is one of the oldest coffee brands in the world, as it was initially set up in 1753 in the Netherlands. The Dutch have also played a vital role in the globalization of coffee, as they were one of the first to sell it out of the Middle East despite governments trying their best to prevent exports. The Netherlands exported $906 million of coffee in 2021, for 127,077 tons.
11. Republic of Guatemala
Coffee Exports in 2021: $928 million
The Republic of Guatemala is a Central American country that is also the most populous in the region. Coffee plays a vital role in the country's economy, as it often ranks as its second largest export. The industry itself consists mostly of small farmers so much so that large growers often find themselves squeezed out due to poor profit margins. 96% of Guatemalan production in 2021 was of Arabica coffee beans. Some top coffee producing regions in the country are Nueva Oriente, San Marcos, and Huehuetenango - with the last being one of the highest coffee producing regions in the world at an altitude of 6,500 feet. Guatemalan coffee is used by big brands such as Starbucks Corporation (NASDAQ:SBUX) at its locations, particularly in the United States.
10. Kingdom of Belgium
Coffee Exports in 2021: $1 billion
The Kingdom of Belgium, or simply Belgium, is one of the most prosperous nations in the world with high standards of living. According to research from the European Union, the country was Europe's third largest importer of green coffee as of 2021. This is coffee that is an extract from unroasted coffee beans. Belgium's Port of Antwerp is capable of storing a whopping 250,000 tons of coffee - unsurprising since Belgium alone exported 296,050 tons of coffee in 2021. The country's coffee industry was worth $3.5 billion in 2022, and it is expected to grow at a CAGR of 8.34% by 2025. One of Belgium's largest and oldest coffee companies is the Miko NV (EBR:MIKO.BR), which traces its roots back to the 1900s and is headquartered in Turnhout.
As coffee consumption in Europe grows, companies like Starbucks Corporation (NASDAQ:SBUX), Monster Beverage Corporation (NASDAQ:MNST), McDonald’s Corporation (NYSE:MCD), The Kraft Heinz Company (NASDAQ:KHC) and The J.M. Smucker Company (NYSE:SJM) are set to profit from this segment of the industry.
9. Federal Democratic Republic of Ethiopia
Coffee Exports in 2021: $1.19 billion
The Federal Democratic Republic of Ethiopia is a landlocked Eastern European country that is often called the 'motherland' of coffee. This is due to the fact that the popular Arabica coffee bean is thought to have originated in the country. Coffee is grown in Ethiopia in primarily four regions. These are the Harrar, Sidama, Yirgacheffe, and Southwest regions. Out of these, Sidama is often called the birthplace of coffee. Ethiopian coffee beans include Longberry, Shortberry, and Mocha - with Longberry being the highest quality bean. Like other African coffee producers, Ethiopia is known for its private distributors instead of brands that sell the drink to consumers. Coffee from these companies is used by Starbucks, Forest Coffee, and others. Some top Ethiopian coffee distributors are Ambassa Enterprises, Shecha Coffee, and Garden of Coffee.
8. Republic of Honduras
Coffee Exports in 2021: $1.29 billion
The Republic of Honduras is a Central American country with a $49 billion economy and one that is rich in mineral resources. Agriculture is the backbone of the Honduran economy, with coffee exports often accounting for a large chunk of its foreign currency earnings. The country has six coffee growing regions, which are Opalaca, Comayagua, Montecillos, Agalta, El Paraiso, and Copan. Honduran coffee packaging often features pictures of the region where it was grown, and some coffee companies are Beneficio De Cafe Montecristo S.A., Cafes Finos De Exportacion S. De R.L., Beneficio De Cafe Inloher S. De, and Lurvin Radames Ventura Sagastume.
7. French Republic
Coffee Exports in 2021: $1.4 billion
The French Republic is a European country that is one of the most prosperous nations in the world. The French coffee industry is worth $12 billion in 2022, and it is expected to grow at a 4.4% CAGR between 2022 to 2025. Since France was one of the old colonial powers, it also played a central role in spreading coffee all over the world. Additionally, one of the first coffee makers was invented in France in the 1800s. Some well known French coffee roasters are Café Lomi, Hexagone Café, Partisan Café Artisanal, and The Beans on Fire.
6. Italian Republic
Coffee Exports in 2021: $2 billion
The Italian Republic is another European country with a large economy and one that is known for a strong food industry. Like Italian wine and cheese, Italian coffee has also made its mark on the world. The country's coffee industry was worth $3.7 billion in 2020, and it is expected to grow and sit at $4.4 billion in 2024. Italy is also home to one of the oldest and largest coffee companies in the world, Luigi Lavazza S.p.A. Like other Italian businesses, Lavazza is also a family run enterprise. Some famous Italian coffee roasters are His Majesty the Coffee and Picapau Coffee Roastery. Due to a rise in coffee consumption, coffee sellers like Starbucks Corporation (NASDAQ:SBUX), Monster Beverage Corporation (NASDAQ:MNST), McDonald’s Corporation (NYSE:MCD), The Kraft Heinz Company (NASDAQ:KHC) and The J.M. Smucker Company (NYSE:SJM) are seeing high coffee sales all over the world.
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Disclosure: None. 12 Countries That Produce the Best Coffee in the World is originally published on Insider Monkey.