INDONESIAN SPECIALTY COFFEE GOES GLOBAL

CATUR SUGIYANTOAGRICULTURE ATTACHEE-BRUSSELS

Outline

• Coffee market in EU

• Challenges to enter the EU market

• Indonesian Specialty Coffee as Opportunity

• Marketing strategy

Coffee market in the EU

• 28 member states• 1 Regulation• 505 Million people• 30,000 US$/capita• 90 % food product

needs: Import

Coffee market in the EU

• EU consumes roasted coffee 4 kg per capita/year: 2,000,000 tons

• Indonesia consumes 1.03 kg per capita/year: 250.000 tons

• 50% world coffee import

10 largest coffee consumersNO COUNTRY KG PER CAP CUPS/DAY

1 FINLAND 9.6 2.64

2 NORWAY 7.2 1.98

3 NETHERLAND 6.7 1.68

4 SLOVENIA 6.1 1.51

5 AUSTRIA 5.5 1.51

6 SERBIA 5.4 1.49

7 DENMARK 5.3 1.46

8 GERMANY 5.2 1.43

9 BELGIUM 4.9 1.35

10 BRAZIL 4.8 1.32

World Coffee Imports 2015 (May)

Source: ICO Sept 2015

61%

25%

6%

3%2%

1% 1% 0%

EUUSAJapanRussian FederationSwitzerlandTurkeyNorwayTunisia

10 Largest EU members Coffee Importers (percent)

Germany; 30.1

Italy; 14.2France; 9.2

Spain; 7.8

Belgium; 7.3

Netherlands; 5.9

United Kingdom; 4.7

Sweden; 3.0Poland; 3.0 Finland; 1.8

EU Coffee Importers (percentage)

Source: ITC 2014

2009 2010 2011 2012 2013

Brazil 37,7 40,3 41,5 35,4 33,6

Viet Nam 15,9 13,5 13,4 18,5 20,7

Honduras 7,1 7,8 8,1 9,1 7,7

Colombia 7,8 5,8 6,5 5,7 6,8

Peru 7,1 8,6 7,8 7,6 6,4

Indonesia 5,4 4,1 3,0 3,4 5,2 India 3,2 3,6 4,8 4,7 4,7

Uganda 4,6 3,3 3,3 3,1 4,1

Ethiopia 3,9 5,1 5,1 4,5 4,0

Guatemala 2,6 3,0 2,5 2,7 1,9

Coffee Market Segment in the EU• At home consumption (70%)

– Supermarket– Specialty coffee seller– Organic coffee seller– Online selling, etc. l

• Out of home consumption (30%)– Restaurant– Café– Coffee Bar– Office

Out of Home 30 %

At home 70 %

Coffee Preference in EU

Sumber: CBI 2013

•High-end and high quality coffee

• Specialty Coffee (Specialty Coffee Association Europe)

•Coffee grown with sustainable practices

•Arabica (except France and Southern Europe)

Unilateral Standard

•Booming of “Coffee Production Standards”:

• Fair Trade: minimum price guarantee for farmers •Organic: organic system of coffee growing•Rainforest Alliance: tropical forest sustainability•UTZ Certified: improvement in business practices and

GAP global• Starbucks (C.A.F.E. practices)•Nespresso (AAA sustainable criteria)

10 Exclusive coffee-single origin cup• Luwak Coffee, Indonesia: €252 per kg. • Hacienda La Esmeralda, Boquete, Panama: €164 per kg. • St. Helena Coffee from St. Helena Coffee Company – St. Helena:

€125 per kg. • El Injerto – Huehuetenango, Guatemala: €79 per kg. • Fazenda Santa Ines, Minas Gerais, Brazil: €79 per kg. • Blue Mountain Coffee, Wallenford Estate, Jamaica: €77 per kg. • Los Planes Coffee, Citala, El Salvador: €63 per kg. • Hawaiian Kona Coffee: €54 per kg. • Starbucks Rwanda Blue Bourbon, Gatare/Karengera, Rwanda: €38

per kg. • Coffee Yauco Selecto AA, Puerto Rico: €38 per kg.

Challenges to enter EU market– Strong competition

– Market Driven Standard

Buyers CertificationBuyers Requirements

Strategy to enter the EU market

• GI cooperation between Indonesia-EU• Promotion of Specialty Coffee• Direct Link between Market and Farmers– Farm Visit of Buyers

• Global Brand Exchange– Special Lobbying to Major Global Brand

Producer: Nestle etc

Indonesian Specialty Coffee as opportunity

Source: Ministry of Agriculture 2014

Map of geographic indication coffee

GI cooperation, Indonesia-EU

•Ministerial meeting (between Indonesia Minister for Justice and Legal Affair and EU Commissioner for Agriculture, Brussels, 30 January 2014)• First exploratory talks, Brussels, late May 2014Results: agree to establish stand-alone agreement, broader scope of IPR protection, relation between trademark and GI,• Second exploratory talks was held last November

2014• Establish Working Group on IPR

Participate in Specialty Coffee Exhibition, engage consumers directly

Cup testing during the World of Coffee Expo 2015 -Gothenburg

Provided funding for National Barista Champion to compete in International event

SELLING AT THE INTERNATIONAL COFFEE EXPO

Bring Indonesian coffee farmers to meet face to face with consumers, traders and distributors

Bisnis Visit to the Coffee Plantation

Introduces the role of coffee to Indonesian economy

Establish direct link between farmers and international buyersJava Republic, turn over 12 million Euro (216 miliar rupiah)

Establish direct link between farmers and international buyers. Bewleys, turn over 97 million Euro (1,5 triliun rupiah)

Indonesian coffee was tested for quality in international coffee events

Introduces Indonesian specialty coffee at exclusive coffee/chocolate boutique……

Cup testing at the local Cafe

KBRI BrusselBoulevard de la Woluwe 38Brussels 1200, BelgiaTelp. +32 27720120Email: kbri.brussel@skynet.be; agriculture.attachee@embassyofindonesia.eu

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