The Rising Sun in Africa – Where Next?

Jul 27, 2012

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Our Far Eastern friends are now taking more than a passing interest in the investment opportunity presented by the African green and finished coffee trade… 

A little like the adventures of Monkey and his comrades – the new money is finding no shortage of new and unusual low fruit investment opportunities and escapades!

I suppose the move makes complete sense…Chinese investment in both African and Australasian traditional industries and mining etc has not only clearly signalled an intent for the new money, but also flagged the imminent rise of a wave of insatiable demand, as billions of Chinese workers suddenly become western style consumers

Hence, the move into coffee… we here in the west drink bucket loads of it a year…. As is well documented, our Nordic friends drink 12 > 14 kilo of the stuff per year…imagine therefore if the Chinese populous were to follow suit in just the smallest most insignificant way… a Tsunami of consumption!!

Current Chinese consumption has reached the trade identified ‘tipping point’ of 1 m bags of green pa…what happens next? Of course… the Chinese and Vietnamese invest in other origin territories…both in anticipation of demand driving value and of course to ensure on going and uninterrupted supply channels of great quality coffee

So Vietnam is now working with Angolan Coffee Board on a programme of rejuvenation…promising to re stock up to 100,000 hectares of land in the Angolan country side, which was ravaged by war between 1975 and 2002

Prior to the civil melt down Angola was the world No.4 and shipped nearly 5 m bags pa… and all excellent, superb quality Robusta!

Today, Africa produces 16.69m bags of coffee….12.7% of the world’s coffee…Angola currently accounts for some 4,000 tonnes of this….Ethiopia  390,000 t and Uganda 193,000t…

Meanwhile, the other big boy on the continent Kenya has approached Chinese investors to fund joint processing ventures….as it reassesses its focus on Europe and looks to the Far East

The processing ventures would aim to ‘add value’ to raw coffee – at the moment the vast majority of all coffee exported from Kenya is unprocessed….. the next steps would be to establish Robusta cultivation in non traditional coffee growing areas….and eventually to rival (non producer) Germanyas the global ‘hub’ of coffee export

So exciting times…. Times of change…Times of investment… and reading between the lines continued focus on coffee as ‘agrimoney’… A commodity subject to the vagaries of venture capital and speculation…  buckle up and prepare for an interesting journey to 2020 my fellow caffeine addicts!

Guru ( Andy Grelak) writes for Aromo Coffee – They are coffee experts focussed on providing convenient and tasty ways for the caffeine addict to take their medicine. Aromo supplies excellent ESE Coffee pods and superlative Senseo pods,  both of which offer the espresso and filter connoisseur  a no mess, no fuss,  super fresh and environmentally conscious method to make stunning coffee… the guys at Aromo also have a range of Dualit branded capsules which make a brilliant and economic alternative to nespresso capsules