STiR coffee and tea magazine

Volume 5, Number 2

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34 STiR tea & coffee industry international / Issue 2, 2016 (April/May) By Thomas Schmid YUNNAN, China Coffee plants were first introduced to China in the late 19th century but large-scale cultivation never really took off. French missionaries found the mountainous south- western province of Yunnan's high-altitude terrain favorable for growing coffee with its prevailing micro climate of cool nights and mild days throughout the year. Coffee thrived but China remained a predominantly tea-drinking nation. It was European coffee companies that first expanded production. Today North American buyers and global traders consider Yunnan to be one of the most promising coffee growing regions in the world. Yunnan's coffee business could well have languished if it not for the Chinese gov- ernment. In 1988, recognizing coffee's potential as a cash crop, China initiated a proj- ect to regenerate the sector. The resulting collaboration with the World Bank and the United Nations Development Program (UNDP) gradually revived cultivation. Initially success proved elusive but in the past two decades coffee cultivation has consistently expanded as farmers switch from other crops. Yunnan, which exclusively grows arabica varietals, currently accounts for more than 95% of China's entire coffee output. The remaining 5% is made up of very minor arabica harvests produced else- where, and similarly small amounts of robusta grown in the province of Fujian and the subtropical island province of Hainan, both located along China's southern seaboard. Although Chinese consumers are developing a taste for coffee (both Starbucks and Nescafé are experiencing record growth rates particularly in the larger cities such as Bei- jing and Shanghai), the bulk of Yunnan-grown arabica is today exported, helping to ease a chronic global shortage. A hodgepodge of players Yunnan is now "the new kid on the block" in the arabica-hungry world attracting many of the better known multinational coffee companies and a slew of international coffee commodity traders that have established a presence in the Chinese province. As the global market experiences a chronic shortage of quality arabica coffee, cultivation in southwestern China's Yunnan province is rapidly expanding, attracting international buyers and the support of investors. But will it be enough to ease the bottle neck? Yunnan: Arabica Supplier to the World? Cupping Chinese arabica at the Louis Dreyfus' coffee facility in Yunnan Drying coffee at Louis Dreyfus' processing facility in Yunnan images courtesy of Louis Dreyfus Commodities Photos courtesy of Louis Dreyfus Commodities

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