October marked one of Colombia’s coffee sector worst months for sales with 13 consecutive days of price drops and an accumulated 7% dip in the New York stock exchange, according to a leading industry organization.
Luis Genaro Muñoz, the Manager of the National Federation of Coffee Growers, added that the coffee futures market also had problems, with a roughly 10% fall in prices.
Muñoz said that the problems in the markets are being caused in large part by the rise in production in other coffee producing countries such as Brazil.
“Our grain, as with other agricultural and financial products, does not escape the law of the market, but we will not abandon our serious and sustained efforts to provide a grain of higher quality, which is recognized, appreciated and increasingly coveted around the world.”
The coffee industry has had a mixed year in terms of success, often mired in controversy despite occasionally positive signs.
Mauricio Galindo, the head of operations at the International Coffee Organization (ICO), told Colombia Reports in May this year that Colombia was benefiting from “the dynamism of emerging markets and economies in the coffee trade,” particularly pointing to Asia as a new source of demand.
However, Colombian coffee growers have also suffered from low prices, a flooded market and disputes regarding a government subsidy program. At several points during the year, moreover massive industry strikes have threatened to impact coffee production.
Last month Muñoz spoke out against the country’s Coffee Farmer Income Protection Fund (PIC), claiming that it was being abused. He said: “What we have seen in recent days is an increase in fraudulent attempts to scam the resources of the PIC which are funds for the producers.”
The subsidy program Muñoz was referring to emerged as the result of nationwide protests organized by Colombia’s coffee workers, who sought guaranteed prices from the Colombian government, as well as improvements in transportation and reductions in the costs of fertilizers and pesticides. The workers also took part in national agricultural strikes toward the end of the summer.
Colombia’s coffee industry is recovering from a disastrous 2011-2012 year, in which a fungus ruined entire harvests throughout the country. During earlier protests this year, workers claimed the industry was making a slow recovery from crisis, and it’s unclear what effect another sustained period of sales losses or price drops could have on civil order in the coffee region.