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PCI: Coffee vs. Cocoa Infographic

COFFEE VS. COCOA Interestings facts & price correlation ARBUC COFFEE & COCOA are among the main agricultural products and are used daily Surely, everyone knows what coffee & cocoa are, as they use it in their daily lives, but a few know that coffee & cocoa are one of the most commonly traded agricultural commodities in the world. Let us have a look at the any part of the world. basic supply and demand trends for these two well-known products. Cocoa, in contrast, first ap- peared among Indians of Latin America, Mayans and Aztecs, several thousand years ago. Currently it is grown mainly in Africa. Its share in the world pro- duction is 74.5%. Latin America grows only 13% of the global cocoa harvest, the rest is grown in Asian countries. Coffee was first used in Africa, Latin America produces 53% of the world coffe Africa produces 74,5% of the world Cocoa Ethiopia in 16th century. Now its main producers are countries of Latin America: its share equals to 53% of the world crop. The second place belongs to the countries of Southeast Asia and Oceania with a share of 33%. 53% 74% The ancestress of coffee is Af- rica, which takes 12% of the world crop. Both crops are grown in the same humid tropical climate. Moreover, coffee first appeared in Africa, and it is now one of the main agricultural crops in Latin America - the birthplace of cocoa. I Coffee Production Cocoa Production I LATIN AMERICA LATIN AMERICA AFRICA AFRICA COFFEE COCOA Côte d'Ivoire 35,1% 000000000 Ghana 23,8% 0000000 Тop 5 Countries 000000000 33,7% Brazil 0000000 18,9% Vietnam 000 00 which produce Coffee & Cocoa Indonesia 10,2% 000 Nigeria 5,6% 00 Brazil 4,6% (0 8% Indoneșia 7,5% Columbia 4,5% Ethiopia The share of Indonesia in the world cocoa production is 10.2% and in global coffee production it is 8%. This confirms their theoretical interchangeability. Countries can produce both cultures, but specialize only in one of them Coffee THE AREA OF AGRICULTURAL CROPS IN THE WORLD Since 1960s coffee farms have been estimated from 9-11 million hectares. X 2,5 I Since 1960s cocoa fams have increased from 4 to 10 million hectares, i.e. by 2.5 times mainly due toA frican countries. WORLD PRODUCTION OF AGRICULTURAL CROPS COCOA PRODUCTION Increased times Over the past 50 years cocoa production has increased 5 times and coffee production - only 2. European share of world cocoa consumption is 50%, America's share share of the main cocoa producer Africa counts only 3% of the world consumption Arabica - 80% Robusta - 18% 33% and Asia's- 14%. The MOST POPULAR COFFEE TYPES Others 2% THE PRICES More than 50 years coffee has been experiencing significant fluctuations between $1- $6 per kg. $3 Polynomial average of the price is marked with black line on the chart. It has been about $3 per kg within the past 20 years. PER KG COCOA'S PRICE IS ONE - THIRD LOWER THAN THE COFFEE PRICE Cocoa has been experiencing fluctuations too. Polynomial average of the price is marked with the black line on the chart. It has been about $2 per kg. COFFEE / COCOA PRICE CORRELATION In the chart below there is the yearly chart for Cofee/Cocoa within the last 50 years, based on their average price per kg. The correlation coefficient has been fluctuating around 1.5, and since the 2000s it has shown a tendency to increase. COFFEE / COCOA 0.5 9e0 1963 1966 1909 1972 1975 1978 1981 1984 1967 1990 1903 1996 1909 2002 2005 2008 2011 2014 THE RISK FACTORS THAT MAY PREVENT OR DELAY COFFEE/COCOA PCI RETURN TO THE AVERAGE LEVE Consumption growth in African cocoa producing countries is possible in case of increasing incomes of the population. They grow almost two-thirds of the global harvest, and consume less than 5%. The coffee yield is 1.5 - 2 times higher than the one of Cocoa. One hectare can provide about 600-1000 kg of coffee or 400-500 kg of cocoa. While the coffee is still 1.5 times more expensive than the cocoa. Coffee/Cocoa PCI has been created through GeWorko Method. The price fluctuations are displayed on NetTradeX trading platform. The study of the instrument has been conducted by IFC Markets. Sources: The International Coffee Organization (ICO) The International Cocoa Organization (ICCÓ) Markets

PCI: Coffee vs. Cocoa Infographic

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The infographic shows the study of the Coffee/Cocoa PCI instrument, which has been developed by IFC Markets. Here you can see some interesting facts about these products and observe the interrelation ...

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