STiR coffee and tea magazine

12 STiR coffee and tea | 2026 Quarter 2 Summer (Jun/July/Aug) China Expands Coffee Processing and Free Trade Zones China continues to increase its investment in the coffee sector by opening several new processing facilities and coffee trade zones. On March 27, the Qingdao area of the China (Shandong) Pilot Free Trade Zone hosted an exchange event for Chinese and Brazilian coffee enterprises. This event marked the inauguration of two key facilities: the Brazilian Specialty Coffee China (Qingdao) Promotion Base and the Qingdao Free Trade Zone Coffee Industry International Expansion Base. These facilities serve as a hub for the display, distribution, and cultural promotion of Brazilian specialty coffee and help Chinese coffee companies expand into the Brazilian market, thereby promoting the development of the coffee industry in China and Brazil. In January 2026, the International Coffee Industry Park project in the Daxing area of Beijing's Airport Economic Zone was selected for imple- mentation. The Lingkong International Coffee Industrial Park aims to become Northern China's first international coffee transshipment and distribution center, a hub for exhibition, trade, and consumption, and Beijing's first specialty coffee industry cluster. Also, Kunshan city in Jiangsu province released an ambitious three-year action plan to position itself as the "Capital of the International Coffee Industry" from 2025 to 2027, targeting a trillion-yuan ($147 billion) scale and a strong cultural brand identity by leveraging its proximity to Shanghai. Kunshan managed to carve out nearly 50,000 square meters from almost saturated space to build the nation's most professional green coffee bean distribution center, attracting numerous well-known companies engaged in green coffee bean trading, including Louis Dreyfus of France and Mitsui & Co. of Japan. China seeks to become an international coffee capital by establishing several new industrial processing, roasting, and storage facilities, as well as additional free trade zones. On a larger scale, Yizheng Foods is building its second-phase factory in Kunshan, which is expected to increase roasting capacity by nearly 50,000 tons annually; Luckin Coffee has invested $120 million in Kunshan to build a second fully automated, intelligent roasting facility to match its Fujian center. To date, Kunshan accounts for nearly 60% of the nation's green bean roasting volume, with an annual roasting capacity of 63,000 tons. By Mainbayar Badarch Is Brazil's Specialty Coffee Sector on the Rise? While the bulk of Brazil's production is still commodity grade, quality is a growing focus for many farmers. A recent USDA report noted that the country's specialty coffee production has "experienced rapid growth" over the past few years, due to efforts by industry and government entities to promote Brazilian specialty coffee abroad. Growth in Brazil's specialty coffee market is also driven by increased interest among domestic coffee drinkers. "In the last 10 years, more farmers are worried about the quality of their beans because they receive a better price for quality," says Jonas Ferraresso, a coffee consultant and agronomist. "They are trying Despite high prices for commodity coffee, Brazil's domestic demand for specialty coffee continues to grow. Photo credit: Wikimedia Commons to produce better coffee, not only to match the needs of the international market, but [also] for the domestic market." As well as growing more coffee than any other country, Brazil is the world's second-largest consumer behind the United States. Demand dropped slightly in recent years, the Brazilian Coffee Industry Association reports, as high prices reached grocery store shelves. Between January and August 2025, roasted and ground coffee prices rose 38.39%, according to data from the Brazilian Supermarket Association. "The high international commodity prices the industry has seen in recent years can negatively impact specialty production in Brazil," Ferraresso says. "For example, traders can be less willing to pay a significant quality premium when the price baseline remains elevated." At the same time, it is more expensive and more compli- cated to produce specialty-grade coffee, which can dissuade farmers from focusing on it as much when commodity prices are high. However, specialty coffee production in Brazil is forecast to continue growing. The USDA report states, "The trend is for growth in the specialty coffee segment, with increasing international demand for quality, traceability, and sustainability." This growth, the report noted, will come from "strong international demand, quality improvements, and targeted promotion." Ferraresso anticipates that the domestic specialty market will also continue growing. "Rising supermarket prices have narrowed the gap between mainstream beans and specialty coffee," he says, "so it is less of a jump to higher-quality coffee now than it once was." By Fionn Pooler Coffee Report

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