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Coffee producers are latest targets of Colombian terrorist group.

Coffee producers are latest targets of Colombian terrorist group

For years, Colombia's feared Ejercito de Liberacion Nacional (National Liberation Army) has terrorized cattle ranchers, oil workers and others associated with so-called "imperialist" industries. Stories of guerillas slaughtering thousands of cows and pigs in acts of political violence abound in the Colombian press.

Now, for the first time, ELN leaders are threatening the nation's coffee producers as well - and most people are taking the threats seriously.

ELN's announcement May 1 that it would establish armed commando units to safeguard the "sovereignty" of the Viejo Caldes coffee-producing zone is "just another attempt to destabilize Colombia's economy, and has nothing to do with social justice," charges Andres Lloreda, spokesman for the country's 300,000-member Federacion Nacional de Cafeteros.

"If there's anywhere in the interior (of Colombia) that's been developed at all, it's thanks to coffee," he said in a telephone interview from Bogota. "The level of economic development in Viejo Caldas is much higher than in any other rural area in the country."

Lloreda insisted his organization has no plans to form vigilante or counter-terrorist squads, and added that coffee growers have complete confidence in the ability of Colombia's armed forces to protect them from attacks.

In an interview with the country's leading newspaper, El Espectador, Colombian Coffee Federation manager Jorge Cardonas said there's no justification for the threats, since "nobody gets rich from coffee production, there's no millionaires" and the industry doesn't exploit anyone. As Lloreda pointed out, "more than 80 percent of the country's coffee producers own no more than five hectares."

In the last 12 months, more than 11,000 Colombians have died in political and drug-related violence, including three presidential candidates who were brave enough to challenge the cocaine barons of Medellin - center of Colombia's multibillion-dollar narcotics industry. The newspaper El Espectador itself was destroyed by a terrorist bomb, for which the drug traffickers later claimed responsibility.

Up until now, Colombia's coffee producers have been relatively untouched by the violence, and there's nothing to suggest that the ELN threat will be carried out, or that it is in any way related to the drug trade. But the local Consejo Regional de Seguridad, a security branch of the government, says it'll keep a close tab on ELN activities in coffee-producing regions. At the same time, Colombian authorities are said to be investigating a possible link between the threats against coffee growers and a 27-year-old man from Manizales who was recently apprehended along with three stolen police uniforms, a military training manual, dynamite detonation devices, drugs and document outlining possible attacks against influential people in the Viejo Caldas region.

Indian coffee exports

said to rise sharply

India's coffee exports for 1989-90 (April-March) were 140,000 metric tons, up 42,000 tons from a year earlier (quoting official sources.

Exports for the first nine months of 1989-90 totalled 93,633 tons, valued at $157 million, and the figures for the last three months were an official estimate, the news agency said. Exports for April-December 1988 were 71,692 tons.

U.K. probe into

coffee prices

After a series of newspaper complaints that the retail price of instant coffee had failed to reflect the sharp decline in green prices, the British Mergers and Monopolies Commission is to investigate the market share which Nestle currently holds. The move, announced in April, was originally set in motion by the Ministry of Agriculture and Food, which referred the complaints to another governmental agency, the Office of Fair Trading, back in January. The OFT has now ordered a detailed, nine-month investigation into a market worth an estimated $920 million.

The initial complaints centered on the fact that while the prices of green coffees had declined by around 45 percent since January 1989, instant coffee prices had risen by six percent to around $10.25. Labor Members of Parliament also drew attention to Nestle's $42 million promotional budget.

Nestle's immediate response was to knock some 35 cents off the $2.50 tag on a 100g jar of its Gold Blend flagship brand, and rivals like Kraft General Foods (Maxwell House and Brooke Bond) were quick to follow suit. In January, Nestle was quick to defend previous price hikes by pointing out that British prices compared more than favorably with West German and French prices ($4.30 and $3.50 respectively).

Spokesman Alan Allbeury also insisted that falls in raw material costs took anything up to six months to filter through to store prices, and he also pointed out that the high-grade Arabicas which Nestle uses in its top brands have also fallen less sharply than the Robustas. He also blamed the fall in the [pounds]-$ exchange rate for accentuating the problem.

However, the National Consumers Council had called on shoppers to boycott any brand which failed to reflect the fall in green prices, acknowledged the news only grudgingly. "It's a step in the right direction," it sniffed.

Apart from the fact that some 90 percent of the British coffee market is held by instants, one of its outstanding features is the demand for the more expensive freeze-dried brands. This is, in many respects, due to Nestle's highly effective marketing strategy, which presents Gold Blend and the "Continental flavor" Blend 37 as the coffee for sophisticates, and in fact the OFT does concede that Nestle's domination of the market (50% is the figure quoted) could well be "due to the quality of its product."

Brazil: Coffee crop

estimated at 22M bags

Brazil is short of first-grade coffee for export. The 1990-91 crop, to be harvested from May onward. was previously estimated at 24.5 million, 60-kilo bags, barely enough to meet international demand at 18 million bags a year, as well as domestic demand. The Jan.-Feb. drought in producing regions, however, has driven the National Coffee Council (NCC) to revise its estimate down to 22 million bags or less.

Coffee growers are pressing the government for the immediate release of Cr$12 million to finance the coffee harvest. Beset by liquidity problems like most farmers, they have also proposed the government should make otherwise blocked new cruzados available for payroll purposes.

However, coffee prices on the world market have risen and the first three shipments have now been made under the new Trade Coordination Bureau (CIC) which has replaced Cacex as the federal foreign trade authority.

Australian roaster happy

with sales of domestic-grown

Cantarella Bros. reports that initial sales of its Vittoria Australian Breakfast Blend ground coffee have exceeded expectations, with the product moving well in both chain and independent stores.

Sales and marketing director Les Schirato said the product had achieved "phenomenal launch success," with the canister packs in great demand as Christmas gifts.

He said the launch had allowed Cantarella Bros. to move into outlets like gift shops and duty free stores where coffee would not normally be sold.

"I'm quite happy with the distribution to date, as weve achieved some major distribution gains. But I'm disappointed that some chains didn't accept it," Schirato said.

Some supermarket buyers, he said, were overly concerned with the price of the product. They were comparing it with standard 500g ground coffees and ignoring its unique features - most of the coffee is sourced from Queensland's Atherton Tablelands, and the product is presented in a limited edition collectible canister, the first of a series.

There was also a general skepticism about how good the coffee would be," he said.

Schirato added that many people had been surprised by the coffee's quality. The majority is Australian grown, but it is blended with some imported coffee to enhance its flavor.

While the company is disappointed that some retailers rejected the product, this could end up being a plus, as the demand is much higher than anticipated, and stock is limited until next year's coffee crop becomes available in April/May. A new canister will probably appear in early 1990.

Cantarella Bros. is now Australia's second alrgest suppliers of pure coffee, according to SAMI figures (volume).

Schirato said that while his company has worked to develop markets and niches for pure coffee, and has now launched a totally new product in Vittoria Australia Breakfast Blend, some retailers had been less than supportive.

"Retailers complain that manufacturers don't do enough to develop markets, but I'd like to put the onus back on retailers," he said.
COPYRIGHT 1990 Lockwood Trade Journal Co., Inc.
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Title Annotation:National Liberation Army
Author:Luxner, Larry
Publication:Tea & Coffee Trade Journal
Date:Jun 1, 1990
Previous Article:World tea production & price forecast.
Next Article:Successful gene-splicing for coffee.

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