XXII. THE PRODUCTION AND CONSUMPTION OF COFFEE…

XXII. THE PRODUCTION AND CONSUMPTION OF COFFEE

A statistical study of world production of coffee by countries--Per capita figures of the leading consuming countries--Coffee-consumption figures compared with tea-consumption figures in the United States and the United Kingdom--Three centuries of coffee trading--Coffee drinking in the United States, past and present--Reviewing the 1921 trade in the United States

The world's yearly production of coffee is on the average considerably more than one million tons. If this were all made up into the refreshing drink we get at our breakfast tables, there would be enough to supply every inhabitant of the earth with some sixty cups a year, representing a total of more than ninety billion cups. In terms of pounds the annual world output amounts to about two and a quarter billions--an amount so large that if it were done up in the familiar one-pound paper packages; and if these packages were laid end to end in a row; they would form a line long enough to reach to the moon. If this average yearly production were left in the sacks in which the coffee is shipped, the total of 17,500,000 would be enough to form a broad six-foot pavement reaching entirely across the United States, upon which a man could walk steadily for more than five months at the rate of twenty miles a day. This vast amount of coffee comes very largely from the western hemisphere; and about three-fourths of it, from a single country. The production, shipment, and preparation of this coffee, directly and indirectly support millions of workers; and many countries are entirely dependent on it for their prosperity and economic well-being.

During the crop year that ended June 30, 1921, this million-ton average was considerably exceeded, though it did not approach the record yield of all time in the crop year 1906-07, when the total amounted to almost 24,000,000 sacks; or, in round numbers, 3,000,000,000 pounds.

As indicated by the Statistical Record table, on page 274, Brazil produces more than all the rest of the world put together. Coffee growing, however, is general throughout tropical countries, and in most of them constitutes one of the leading industries. Yet in most cases, the actual production of these countries can only be estimated, as accurate figures, showing the exact output, are seldom kept. But the contribution which each country makes to the total world traffic in coffee can be determined by its export figures, which are obtainable in reasonably accurate and up-to-date form. The table on page 276 gives the coffee export figures, in pounds, for practically every country that produces coffee for sale outside its own borders. Figures are given for the latest available year, and also for the average of the last five years for which statistics are to be obtained. The figures are taken from official statistics, from the publications of the International Institute of Agriculture of Rome, and from other authoritative sources.

STATISTICAL RECORD FOR THIRTY-EIGHT YEARS

Crops /---------------------------------\ Fiscal Rio and Other Total Year Santos Countries (Bags) (July 1 to (Bags)[I] (Bags) June 30)

1883-84 5,047,000 4,526,000 9,573,000 1884-85 6,206,000 4,004,000 10,210,000 1885-86 5,565,000 3,505,000 9,070,000 1886-87 6,078,000 4,106,000 10,184,000 1887-88 3,033,000 3,214,000 6,247,000 1888-89 6,827,000 3,672,000 10,499,000 1889-90 4,260,000 3,965,000 8,225,000 1890-91 5,358,000 2,886,000 8,244,000 1891-92 7,397,000 4,453,000 11,850,000 1892-93 6,203,000 4,887,000 11,090,000 1893-94 4,309,000 5,307,000 9,616,000 1894-95 6,695,000 5,069,000 11,764,000 1895-96 5,476,000 4,901,000 10,377,000 1896-97 8,680,000 5,238,000 13,918,000 1897-98 10,462,000 5,596,000 16,058,000 1898-99 8,771,000 4,985,000 13,756,000 1899-00 8,959,000 4,842,000 13,801,000 1900-01 10,927,000 4,173,000 15,100,000 1901-02 15,439,000 4,296,000 19,735,000 1902-03 12,324,000 4,340,000 16,664,000 1903-04 10,408,000 5,575,000 15,983,000 1904-05 9,968,000 4,480,000 14,448,000 1905-06 10,227,000 4,565,000 14,792,000 1906-07 19,654,000 4,160,000 23,814,000 1907-08 10,283,000 4,551,000 14,834,000 1908-09 12,419,000 4,499,000 16,918,000 1909-10 14,944,000 4,181,000 19,125,000 1910-11 10,548,000 3,976,000 14,524,000 1911-12 12,491,000 4,918,000 17,409,000 1912-13 11,458,000 4,915,000 16,373,000 1913-14 13,816,000 5,796,000 19,612,000 1914-15 12,867,000 5,019,000 17,886,000 1915-16 14,992,000 4,764,000 19,756,000 1916-17 12,112,000 4,579,000 16,691,000 1917-18 15,127,000 3,720,000 18,847,000 1918-19 9,140,000 4,500,000 13,640,000 1919-20 6,700,000 8,463,000 15,163,000 1920-21 13,816,000 6,467,000 20,283,000

Deliveries /---------------------------------\

Fiscal United Year Europe States Total (July 1 to (Bags) (Bags) (Bags) June 30)

1883-84 6,774,000 2,635,000 9,409,000 1884-85 7,388,000 3,169,000 10,557,000 1885-86 7,198,000 2,938,000 10,136,000 1886-87 7,363,000 2,672,000 10,035,000 1887-88 5,888,000 2,164,000 8,052,000 1888-89 6,589,000 2,659,000 9,249,000 1889-90 6,716,000 2,704,000 9,420,000 1890-91 6,046,000 2,673,000 8,719,000 1891-92 6,392,000 4,412,000 10,804,000 1892-93 6,457,000 4,389,000 10,945,000 1893-94 6,272,000 4,298,000 10,570,000 1894-95 6,816,000 4,396,000 11,212,000 1895-96 6,803,000 4,339,000 11,142,000 1896-97 7,155,000 5,080,000 12,244,000 1897-98 8,535,000 6,036,000 14,571,000 1898-99 7,798,000 5,682,000 13,480,000 1899-00 8,937,000 6,035,000 14,972,000 1900-01 8,486,000 5,843,000 14,329,000 1901-02 8,853,000 6,663,000 15,516,000 1902-03 9,118,000 6,847,000 15,966,000 1903-04 9,280,000 6,853,000 16,133,000 1904-05 9,475,000 6,687,000 16,163,000 1905-06 9,934,000 6,806,000 16,741,000 1906-07 10,502,000 7,042,000 17,544,000 1907-08 10,481,000 7,043,000 17,525,000 1908-09 11,129,000 7,519,000 18,649,000 1909-10 10,811,000 7,287,000 18,098,000 1910-11 10,492,000 7,015,000 17,507,000 1911-12 10,712,000 6,762,000 17,474,000 1912-13 10,144,000 6,675,000 16,820,000 1913-14 11,027,000 7,545,000 18,573,000 1914-15 13,368,000 8,010,000 21,378,000 1915-16 11,050,000 8,834,000 19,884,000 1916-17 5,171,000 9,046,000 14,217,000 1917-18 6,209,000 8,624,000 14,833,000 1918-19 6,073,000 8,994,000 15,067,000 1919-20 7,047,000 9,683,000 16,730,000 1920-21 6,397,000 9,701,000 16,099,000

Spot Fiscal Visible Quotations, Year Supply Rio No. 7 (July 1 to July 1. New York, June 30) (Bags) July 1.

1883-84 1884-85 5,398,000 8-1/4 1885-86 5,051,000 7-1/8 1886-87 3,985,000 8-1/4 1887-88 4,134,000 16-7/8 1888-89 2,329,000 13-1/2 1889-90 3,579,000 14-1/2 1890-91 2,384,000 17-1/2 1891-92 1,909,000 17-3/8 1892-93 2,955,000 17-7/8 1893-94 3,100,000 16-5/8 1894-95 2,146,000 16-1/2 1895-96 3,115,000 15-3/4 1896-97 2,588,000 13 1897-98 3,975,000 7-3/8 1898-99 5,435,000 6-1/4 1899-00 6,200,000 6-1/8 1900-01 5,840,000 8-15/16 1901-02 6,867,000 6 1902-03 11,261,000 5-1/4 1903-04 11,900,000 5-3/16 1904-05 12,361,000 7-1/8 1905-06 11,265,000 7-3/4 1906-07 9,636,000 7-15/16 1907-08 16,400,000 6-3/8 1908-09 14,126,000 6-1/4 1909-10 12,841,000 7-3/4 1910-11 13,719,000 8-3/8 1911-12 11,070,000 13-1/8 1912-13 11,048,000 14-3/4 1913-14 10,285,000 9-5/8 1914-15 11,302,000 8-3/4 1915-16 7,523,000 7-1/2 1916-17 7,328,000 9-1/8 1917-18 7,793,000 9-1/2 1918-19 8,783,000 8-1/2 1919-20 7,173,000 22-1/4 1920-21 6,909,000 13-1/4

[I] 1 Bag=132.27 lbs.

For the most part, these figures of exportation are the only ones available to indicate the actual coffee production in the countries named. The following additional data, however, will serve to show the extent to which the coffee-raising industry has developed in most of these countries, and in a few places of minor importance not named in the table:

BRAZIL. The coffee industry of Brazil, which has furnished seventy percent of the world's coffee during the last ten years, has developed in a century and a half. Brazilian soil first made the acquaintance of the coffee plant at Para in 1723. A small export trade to Europe had developed by 1770, the year when the first plantation was established in the state of Rio de Janeiro, and from which the country's great industry really dates. Development at first was apparently slow, as no exports are recorded until the beginning of the nineteenth century; so that the history of Brazil's coffee trade is a matter entirely of the nineteenth and twentieth centuries. Once started, however, the new line of export made rapid progress. In 1800, the amount of coffee exported was 1720 pounds, contained in thirteen bags. Twenty years later, 12,896,000 pounds were shipped, the number of bags being 97,498. Ten years later, in 1830, this amount had increased to 64,051,000 pounds; and in 1840, to 137,300,000 pounds. In 1852-53, the receipts for shipment at the ports were double that amount, 284,592,000 pounds; in 1860-61 they were 420,420,000 pounds; in 1870-71 they had increased to 427,416,000 pounds; in 1880-81 they were 764,945,000 pounds; in 1890-91, 739,654,000 pounds; and at the beginning of this century, 1900-01, they were 1,504,424,000 pounds, having passed the one billion-pound mark in 1896-97. The highest point of coffee receipts in the country's history was reached in 1906-07 with 2,699,644,694 pounds; and since that year, the amount has staid at about one and one-half billion pounds. Further expansion in the last fifteen years has been closely regulated to prevent overproduction.

EXPORTS OF COFFEE FROM THE COFFEE-PRODUCING COUNTRIES OF THE WORLD

Country Five-Year Average South America: Year Pounds Pounds Brazil 1920 1,524,382,650 1,469,949,180 Colombia 1920 190,961,953[c] 172,862,121 Venezuela 1920 73,726,632 110,174,946 Guiana, Br. 1917 267,344 257,152 Guiana, Fr. 1918 1,100 970 Guiana, D. 1918 3,856 923,644[d] Ecuador 1919 3,729,413 5,843,033 Peru 1919 370,655 455,212 Central America: Salvador 1920 82,864,668 78,953,339 Nicaragua 1920 15,345,398 23,243,865 Costa Rica 1921[a] 29,401,683 28,667,262 Guatemala 1920 94,205,569 88,213,080 Honduras 1920[b] 1,091,977 646,574 Mexico 1918 30,172,065 47,555,514[d] West Indies: Haiti 1920[b] 61,970,694[e] 54,308,959[d] Dominican Republic 1920 1,361,666 3,497,866 Jamaica 1919 8,246,672 7,918,781 Porto Rico 1921 29,967,879[f] 30,033,471[d][f] Trinidad & Tobago 1920 73,201 19,639 Martinique 1918 10,358 17,219 Guadeloupe 1918 2,144,855 1,594,146 Dutch East Indies 1920 99,020,453[i] 103,701,297[h] Pacific Islands: Br. North Borneo 1918 1,984 6,618 New Caledonia 1916 1,248,024 784,176 New Hebrides 1917 625,224 608,410[g] Hawaii 1921 4,979,121[f] 4,244,479[d][f] Reunion 1918 3,527 26,455 Asia: Aden (Arabia) 1921[b] 9,463,104 10,837,893 Br. India 1920[b] 30,526,832 23,767,744 French Indo-China 1918 79,145 516,978 Africa: Eritrea 1918 728,840 315,698 Somaliland, Fr. 1917 11,222,736 9,321,930 Somaliland, Br. 1918 440,272 233,908 Somaliland, It. 1918 3,747 3,306 Abyssinia 1917 17,324,223 12,744,406 German East Africa (former) 1913 2,334,450 2,649,047[d] Br. East African Protectorate 1918 18,735,572 8,397,541 Uganda 1918 9,999,845 5,076,091 Nyasaland 1918 122,796 92,593 Mayotte (including Comoro Is.)1914 3,306 660 Madagascar 1918 707,676 981,047 Angola 1913 10,655,934 10,459,724 Belgian Congo 1919 347,588 186,432[h] Fr. Equatorial Africa 1916 48,060 47,046 Nigeria 1916 3,527 19,180 Ivory Coast 1918 66,358 49,162 Gold Coast 1917 660 220 French Guinea 1918 1,320 1,320 Spanish Guinea 1918 8,150 3,968[h] St. Thomas & Prince's Is. 1916 484,350 1,125,448 Liberia 1917 761,300 Cape Verde Islands 1916 1,442,910 1,100,095

[a] Crop year.

[b] Fiscal year.

[c] Including small proportion of unhusked coffee.

[d] Four-year average.

[e] Not including 6,322,167 pounds "triage" or waste coffee.

[f] Including shipments to continental United States.

[g] Two-year average.

[h] Three-year average.

[i] Java and Madura only

It is estimated that the area in the coffee-growing section suitable for coffee raising covers 1,158,000 square miles, or more than one-third the area of continental United States. The state of Sao Paulo is the chief producing state, and supplies practically half the world's annual output. Most of this Sao Paulo coffee is exported through the port of Santos, which is consequently the leading coffee port of the world. Besides Santos, the ports of Rio de Janeiro and Victoria are of much importance in the coffee trade, although some twenty or thirty million pounds are exported each year through the port of Bahia, and smaller amounts through various other ports. The crop year of Brazil runs from July 1 to June 30, the heaviest receipts for shipment coming as a rule in the months of August, September, and October of each year. One-third of the season's crop is usually received at ports of shipment before the last of October, sometimes as early as the latter part of September; one-half comes in by the middle or last of November; and two-thirds is usually received, by the end of January.

VENEZUELA. The coffee plant was introduced into Venezuela in 1784, being brought from Martinique; and the first shipment abroad, consisting of 233 bags, was made five years later. By 1830-31, production had increased to 25,454,000 pounds; and in the next twenty years, it more than trebled, amounting to 83,717,000 pounds in 1850-51. Since then, however, the increase has been much more gradual. In 1881-82, 94,369,000 pounds were produced; and about the same amount, 95,170,000 pounds, in 1889-90. Twentieth-century production has apparently exceeded the hundred-million mark on the average, although there are no definite statistics beyond export figures. These showed 86,950,000 pounds sent abroad in 1904-05; 103,453,000 pounds in 1908-09; and 88,155,000 pounds in 1918; the trade in the last-named year being cut down by war conditions. In 1919, the extraordinary amount of 179,414,815 pounds was exported, the high figure being due to the release of coffee stored from previous years. It has been estimated that domestic consumption of coffee would amount to a maximum of 25,000,000 pounds yearly, but may be much less than that. The United States and France have in the past been Venezuela's best customers.

COLOMBIA. Prior to 1912, the total production of coffee in Colombia was around 80,000,000 pounds annually, of which some 3,000,000 or 4,000,000 pounds were consumed in the country itself. But in the last decade production has been advancing rapidly, and the present production is the heaviest in the history of the country. The industry has practically grown up in the last seventy years, the exports for the decade 1852-53 to 1861-62 averaging only about 940,000 pounds; in the decade following, about 5,700,000 pounds; and, in the ten years from 1872-73 to 1881-82, about 12,600,000 pounds, according to an unofficial compilation. Exportations had advanced to about 47,000,000 pounds by 1895; and to 80,000,000 pounds by 1906. As large quantities of Colombian coffee are shipped out through Venezuela, and because of the lack of detailed statistics in Colombia, the actual exportation each year is not easy to determine; but the following figures, obtained by a trade commissioner of the United States, may be taken as a fairly accurate estimate of exports from 1906 to 1918:

COLUMBIAN COFFEE EXPORTS Year Sacks (138 lbs.)

1906 605,705 1907 541,300 1908 577,900 1909 673,350 1910 543,000 1911 601,600 1912 888,800 1913 972,000 1914 983,000 1915 1,074,600 1916 1,153,000 1917 1,093,000 1918 1,102,000

ECUADOR. Annual production in Ecuador runs from 3,000,000 to 8,000,000 pounds, most of which is exported. The greater part of the production is sent to Chile and the United States. Production has shown only a gradual increase since the middle of the nineteenth century, when planters began to give some attention to coffee cultivation. Exports were about 87,000 pounds in 1855; 296,000 pounds in 1870; and 985,000 pounds in 1877. By the beginning of the present century, production had reached 6,204,000 pounds; in 1905, it was estimated at 4,861,000 pounds; and in 1910, at 8,682,000 pounds. Exports in 1912 were 6,101,700 pounds; and 7,671,000 pounds in 1918; but there was a falling off to 3,729,000 pounds in 1919. Several years ago it was estimated that the coffee trees numbered 8,000,000, planted on 32,000 acres.

PERU. Coffee is one of the minor products of Peru, and the country does not occupy a place of importance in the international coffee trade. The larger part of the production is apparently consumed in the country itself. Export figures indicate that the industry is steadily declining. Exports amounted to 2,267,000 pounds in 1905; to 1,618,000 pounds in 1908; and in the five years ending with 1918, exports averaged only 529,000 pounds; while figures for 1919 show that in that year they fell still lower, to 370,000 pounds. Production is mainly in the coast lands.

BRITISH GUIANA. The Guianas are the site of the first coffee planting on the continent of South America; and according to some accounts, the first in the New World. The plants were brought first into Dutch Guiana, but there was no planting in what is now British Guiana (then a Dutch colony) until 1752. Twenty-six years later, 6,041,000 pounds were sent to Amsterdam from the two ports of Demarara and Berbice; and after the colony fell into the hands of the English in 1796, cultivation continued to increase. Exports amounted to 10,845,000 pounds in 1803; and to more than 22,000,000 pounds in 1810. Then there was a falling off, and the production in 1828 was 8,893,500 pounds and 3,308,000 pounds in 1836. In 1849 British Guiana exported only 109,600 pounds. For a long period thereafter there was little production, and practically no exportation; exports in 1907, for instance, amounting to only 160 pounds. With the next year, however, a revival of exportation began, and it has continued to grow since then. In 1908, exports were 88,700 pounds; and for the succeeding years, up to 1917, the following amounts are recorded: 1909, 96,952 pounds; 1910, 108,378 pounds; 1911, 136,420 pounds; 1912, 144,845 pounds; 1913, 89,376 pounds; 1914, 238,767 pounds; 1915, 172,326 pounds; 1916, 501,183 pounds; 1917, 267,344 pounds. In the last-named year 4,953 acres were in coffee plantations.

FRENCH GUIANA. This colony raises a small amount of coffee for local consumption, and exports a few hundred pounds; but it is really an importing and not an exporting colony. Coffee cultivation was never of much importance, although in 1775 some 72,000 pounds were exported. One hundred and eighty thousand pounds were harvested in 1860; and 132,000 pounds in 1870, mostly for local consumption.

DUTCH GUIANA. Regular shipments of coffee from Dutch Guiana have been made for two centuries, beginning--a few years after the plant was introduced--with a shipment of 6,461 pounds to the mother country in 1723. Seven years later, 472,000 pounds were shipped; and in 1732-33 exportation reached 1,232,000 pounds. Exports were averaging 16,900,000 pounds a year by 1760; and reached almost 20,600,000 pounds in 1777. At the beginning of the nineteenth century, they amounted to about 17,000,000 pounds; but a few years later fell off to some 7,000,000 pounds, where they remained until about 1840; after which they began again to decline. Exportation had practically ceased by 1875, only 1,420 pounds going out of the country, although cultivation still continued, as evidenced by a production of 82,357 pounds in that year. In 1890, production was only 15,736 pounds, and exports only 476 pounds; but since then there has been a considerable increase. In 1900, production amounted to 433,000 pounds, and exports to 424,000 pounds. In 1908, 1,108,000 pounds were grown, of which 310,000 pounds were sent abroad; and in 1909, the figures were 552,000 pounds produced and 405,000 pounds exported. No figures are available for production in recent years; but the exportation of 1,600,000 pounds in 1917 indicates that plantings have been steadily growing.

OTHER SOUTH AMERICAN COUNTRIES. Of the other South American countries, Argentina, Chile, and Uruguay are coffee-importing countries; and the coffee-raising industry of Paraguay, although more or less promising, has yet to be developed. In Argentina, a few hundred acres in the sub-tropical provinces of the north have been planted to coffee; but coffee-growing will always necessarily remain a very minor industry. Many attempts have been made to establish the industry in Paraguay, where favorable conditions obtain, but only a few planters have met with success. Their product has all been consumed locally. Bolivia has much land suitable for coffee raising; and it is estimated that production has reached as high as 1,500,000 pounds a year, but transportation conditions are such as to hold back development for an indefinite time. Small amounts are now exported to Chile.

SALVADOR. Coffee was introduced into Salvador in 1852, and immediately began to spread over the country. Exports were valued at more than $100,000 in 1865; and by 1874-75 the amount exported had reached 8,500,000 pounds. The first large plantation was established in 1876; and since then planting has continued, until now practically all the available coffee land has been taken up. The area in plantations has been estimated at 166,000 acres, and the annual production at 50,000,000 to 75,000,000 pounds, of which some 5,000,000 pounds are consumed in the country. Since the beginning of the present century, exports have in general shown a considerable increase, the figures for 1901 being 50,101,000 pounds; for 1905, 64,480,000 pounds; for 1910, 62,764,000 pounds; for 1915, 67,130,000 pounds; and for 1920, 82,864,000 pounds.

GUATEMALA. Cultivation of coffee in Guatamala became of importance between 1860 and 1870. In 1860, exports were only about 140,000 pounds; by 1863, they had increased to about 1,800,000 pounds; and by 1870, to 7,590,000 pounds. In 1880-81, they amounted to 28,976,000 pounds; and in 1883-84, to 40,406,000 pounds. Twenty years later, they had doubled. In recent years, exports have ranged between 75,000,000 and 100,000,000 pounds; the years from 1909 to 1918 showing the following results, according to a consular report:

GUATEMALA'S COFFEE EXPORTS

Cleaned Unshelled Year (pounds) (pounds)

1900 92,639,800 23,654,600 1910 50,717,600 19,671,700 1911 60,689,500 20,959,500 1912 14,329,800 60,837,500 1913 70,749,100 20,980,700 1914 71,136,800 14,999,600 1915 69,649,500 9,892,000 1916 85,057,000 3,015,800 1917 89,259,600 1,410,200 1918 77,842,800 511,500

COSTA RICA. Coffee raising in Costa Rica dates from 1779, when the plant was introduced from Cuba. By 1845, the industry had grown sufficiently to permit an exportation of 7,823,000 pounds; and twenty years later, 11,143,000 pounds were shipped. Thereafter, production increased rapidly; so that in 1874, the total exports were 32,670,000 pounds, and in 1884 they were more than 36,000,000 pounds. In recent years, the average production has been around 35,000,000 pounds. For the crop years 1916-17 to 1920-21 exports have been:

COSTA RICA'S COFFEE EXPORTS

Year Pounds

1916-17 27,044,550 1917-18 25,246,715 1918-19 30,784,184 1919-20 30,860,634 1920-21 29,401,683

NICARAGUA. Production of coffee in Nicaragua began between 1860 and 1870; and in 1875, the yield was estimated at 1,650,000 pounds. By 1879-80, this had increased to 3,579,000 pounds; and by 1889-90, to 8,533,000 pounds. In 1890-91 production was 11,540,000 pounds; and in 1907-08 it was estimated at more than 20,000,000 pounds. Ten years later, 25,000,000 pounds were produced; and the crop of 1918-19 was estimated at about 30,000,000 pounds. Lack of transportation, and excess of political troubles, have been important factors in holding back development.

HONDURAS. The coffee of Honduras is of very good quality; but production is small, and the country is not an important factor in international trade. Exports usually run less than 1,000,000 pounds. The chief obstacle to expansion is said to be lack of transportation facilities.

BRITISH HONDURAS. This colony grows a little coffee for its own use, but imports most of what it needs. Production had reached almost 50,000 pounds in 1904; but the present average is only about 10,000 pounds, raised on scattering trees over about 1,000 acres.

PANAMA. A small amount of coffee, of which occasionally as much as 200,000 or 250,000 pounds a year are exported, is raised in the uplands of Panama, or is gathered from wild trees. The industry is not of great importance, and the country imports considerable supplies, mostly from the United States.

MEXICO. A very good grade of coffee is produced in Mexico; and it is said that there is sufficient area of good coffee land to take care of the demand of the world outside of that supplied by Brazil. Production, however, is limited, and to a large extent goes to satisfy home needs, leaving only about 50,000,000 pounds for export. In spite of much government encouragement in past years, coffee cultivation has not made rapid progress, when we remember that the country became acquainted with the plant as early as 1790. Not until about 1870 did the country begin to become important in the list of coffee-exporters; but by 1878-79, shipments amounted to about 12,000,000 pounds. This steadily increased to 29,400,000 pounds in 1891-92. Exports in recent years have averaged about 50,000,000 pounds; but in 1918 were only 30,000,000. Production has fluctuated greatly. In the years preceding the troubled revolutionary period, the total output was estimated as follows: 1907, 45,000,000 pounds; 1908, 42,000,000 pounds; 1909, 81,000,000 pounds; 1910, 70,000,000 pounds. In the ten years preceding 1907, production dropped as low as 22,000,000 pounds in 1902; and rose to 88,500,000 pounds in 1905. Next to the United States, Germany was the chief buyer of Mexican coffee before the war; although France and Great Britain also took several million pounds each.

HAITI. For well over a century Haiti has been shipping tens of millions of pounds of coffee annually; and the product is the mainstay of the country's economic life. In all that time, however, shipments have maintained much the same level. The country has been a coffee producer from the early years of the eighteenth century, when the plants began to spread from the original sprigs in Guiana or Martinique. After half a century of growth, exports had risen to 88,360,000 pounds in 1789-90, a mark that has never again been reached. Since then, exports have ranged between 40,000,000 and 80,000,000 pounds, keeping close to the lower mark in recent years because of European conditions. They were 38,000,000 pounds in 1856; 55,750,000 pounds in 1866; and 52,300,000 pounds in 1876. They had reached 84,028,000 pounds in 1887-88; but fell back to 67,437,000 pounds in 1897-98; and ten years later, were 63,848,000 pounds. In 1917-18, they were only about two-thirds that amount, or 42,100,000 pounds. Some 8,000,000 pounds are consumed yearly in the country itself. The coffee plantations cover about 125,000 acres.

DOMINICAN REPUBLIC. Coffee production in the Dominican Republic ranges between 1,000,000 and 5,000,000 pounds, exports in recent years averaging about 3,500,000 pounds. The quality of the coffee is good; but the plantations are not well cared for. Until fifty years ago, the industry was in a state of decline from a condition of former importance; but it was revived, and by 1881 it supplied 1,400,000 pounds for export. The amount was 1,480,000 pounds in 1888; 3,950,000 pounds in 1900; 1,540,000 pounds in 1909; and 4,870,000 pounds in 1919. Blight, and disturbed political conditions, have hampered development. In normal times, Europe takes most of the export.

JAMAICA. Jamaica began to raise coffee about 1730; and from that time on there was a steady but slow increase in production. Shipments amounted to about 60,000 pounds in 1752, and to about 1,800,000 pounds in 1775. At the beginning of the new century, in 1804, exports of 22,000,000 pounds are recorded; and in 1814 the figure was 34,045,000 pounds. Then exports gradually fell off, and in 1861 were only 6,700,000 pounds. They were 10,350,000 pounds in 1874; and since then, have not varied much from 9,000,000 or 10,000,000 pounds a year. They were 9,363,000 pounds in 1900; 7,885,000 pounds in 1909; and 8,246,000 pounds in 1919. The acreage in coffee remains fairly constant, being 24,865 in 1900; 22,275 in 1911; and 20,280 in 1917. It is said that there are 80,000 acres of good coffee land still uncultivated.

PORTO RICO. The cultivation of coffee in Porto Rico dates back to the middle of the eighteenth century; but exportation does not seem to have been much more than a million pounds a year until the first years of the nineteenth century. Between 1837 and 1840, the average exportation was about 10,000,000 pounds; and by 1865, this had risen to 24,000,000 pounds. Ten years later, it was 25,700,000 pounds. In recent years, it has averaged about 37,000,000 pounds; the 1921 figure, including shipments to continental United States, being 29,968,000 pounds. Production since 1881 has been between 30,000,000 and 50,000,000 pounds; the heaviest being in 1896 when the total output was 62,628,337 pounds--the largest figure in the island's history. The industry was greatly damaged by a disastrous storm in 1900, and was also adversely affected by the European War, as a large part of Porto Rico's crop goes to Europe. Porto Rican coffee has not been popular in the United States, which takes only limited amounts. Cuba is one of the island's best customers.

GUADELOUPE. Coffee production in Guadeloupe reached its highest point in the latter part of the eighteenth century, when more than 8,000,000 pounds were raised. The figure was about 6,000,000 in 1808; but the output declined during the succeeding decades, and forty years later was only 375,000 pounds. The amount produced in 1885 was 986,000 pounds; and there has been a gradual increase, so that the crop has been large enough to permit the exportation of 1,000,000 to 2,000,000 pounds, or more, since the beginning of the present century. Exports in 1901 were 1,449,000 pounds; in 1908, 2,266,000 pounds; and in 1918, 2,144,000 pounds.

OTHER WEST INDIAN ISLANDS. Some little coffee is gathered for home consumption in many other West Indian islands, but little is exported. The island of Martinique, which is said to have seen the introduction of the coffee plant into the western hemisphere, does not now raise enough for its own use. Cuba was formerly one of the important centers of production; but for various reasons the industry declined, and for many years the country has imported most of its coffee supply. A century ago, the plantations numbered 2,067; and the annual exportation amounted to 50,000,000 pounds. When the island became independent, steps were taken to revive coffee planting; and in 1907 there were 1,411 plantations and 3,662,850 trees, producing 6,595,700 pounds of coffee. The Cubans, however, now find it convenient to obtain their coffee from the neighboring island of Porto Rico and from other sources; and importations have remained around 20,000,000 pounds a year. In Trinidad and Tobago, exports have reached as high as 1,000,000 pounds a year; but in recent times they have fallen off heavily. St. Vincent exported 485 pounds in 1917, and Grenada, 251 pounds in 1916. The Leeward Islands exported 1,415 pounds in 1917, and 2,946 pounds in 1916, the acreage being 274, the same as for many years past.

ARABIA. The home of the famous Mocha coffee still produces considerable quantities of that variety, although the output, comparatively speaking, is not large. The chief district is the vilayet of Yemen; and the product reaches the outside world mainly through the port of Aden, although before the war much of this coffee was exported through Hodeida. The port of Massowah, in the last two or three years, has been drawing some of the supply of Mocha for export. No statistics are available to show the production of Mocha coffee; but an estimate made by the oldest coffee merchant in Aden places the average annual output at 45,000 bags of 176 pounds each, or 7,920,000 pounds. Although this is the only district in the world that can produce the particular grade of coffee known as Mocha, there is little systematic cultivation, and large areas of good coffee land are planted to other crops to provide food for the natives. When transportation facilities are provided, so that this food can be imported, it is predicted that the output of Mocha coffee will be doubled.

Aden is a great transhipping port for coffee from Asia and Africa, and more than half its exports are re-exports from points outside of Arabia. The following figures will show the proportion of Arabian coffee coming into Aden for export as compared with that from other producing sections:

ADEN'S COFFEE RECEIPTS FOR RE-EXPORT

Imports 1916-17 1917-18 1918-19 from (pounds) (pounds) (pounds)

Abyssinia (via Jibuti) 4,529,280 6,174,896 4,337,760 Mocha and Ghizan 3,555,104 6,562,752 3,075,024 Somaliland (British) 394,128 396,592 245,840 Straits Settlements 672,224 Zanzibar and Pemba 92,512 795,312 764,288 All other countries 162,064 307,104 323,616 --------- ---------- --------- Total 9,405,312 14,236,656 8,746,528

BRITISH INDIA. Cultivation of coffee was begun systematically in India in 1840; and twenty years later, the country exported about 5,860,000 pounds. For the next eight years the exports remained at about that figure; but in 1859 they amounted to 11,690,000 pounds; and by 1864 they had doubled, rising in that year to 26,745,000 pounds. They have continued at between 20,000,000 and 60,000,000 pounds ever since, reaching their highest point in 1872 with 56,817,000 pounds. In recent years, production and exportation have declined; the exports in 1920 being only 30,526,832 pounds. The area under coffee has been between 200,000 and 300,000 acres for fifty years or more, reaching its highest point in 1896, with 303,944 acres. Recently the area has been slowly decreasing.

CEYLON. The island of Ceylon was formerly one of the important producers of coffee; and the industry was a flourishing one until about 1869, when a disease appeared that in ten or fifteen years practically ruined the plantations. Production has gone on since then, but at a steadily declining rate. In late years, the island has not produced enough for its own use, and is now ranked as an importer rather than as an exporter. It is said that systematic cultivation was carried on in Ceylon by the Dutch as early as 1690; and shipments of 10,000 to 90,000 pounds a year were made all through the eighteenth century, exports in one year, 1741, going as high as 370,000 pounds. The English took the island in 1795, and thirty years later, they began to expand cultivation. Exports had risen to 12,400,000 pounds in 1836; and they continued to increase to a high point of 118,160,000 pounds in 1870; but in the next thirty years they declined, until they were only 1,147,000 pounds in 1900. The total acreage in coffee at one time reached as high as 340,000; but as the coffee trees were affected by the leaf disease, this land was turned to tea; and in 1917 there were only 810 acres left in coffee.

DUTCH EAST INDIES. The year 1699 saw the importation from the Malabar coast of India to Java of the coffee plants which were destined to be the progenitors of the tens of millions of trees that have made the Dutch East Indies famous for two hundred years. Twelve years afterward, the first trickle of the stream of coffee that has continued to flow ever since found its way from Java to Holland, in a shipment of 894 pounds. About 216,000 pounds were exported in 1721; and soon thereafter, shipments rose into the millions of pounds.

From 1721 to 1730 the Netherlands East India Co. marketed 25,048,000 pounds of Java coffee in Holland; and in the decade following, 36,845,000 pounds. Shipments from Java continued at about the latter rate until the close of the century, although in the ten years 1771-80 they reached a total of 51,319,000 pounds. The total sales of Java coffee in Holland for the century were somewhat more than a quarter of a billion pounds, which represented pretty closely the amount produced.

With the beginning of the nineteenth century, coffee production soon became much heavier; and in 1825 Java exported, of her own production, some 36,500,000 pounds, besides 1,360,000 pounds brought from neighboring islands to which the cultivation had spread. In 1855, the amount was 168,100,000 pounds of Java coffee, and 4,080,000 pounds of coffee from the other islands. This is the highest record for the half-century following the beginning of the regular reports of exports in 1825. From 1875 to 1879 the average annual yield was 152,184,000 pounds. In 1900, production in Java was 84,184,000 pounds; in 1910, it was 31,552,000 pounds, and in 1915 it had jumped to 73,984,000 pounds.

On the west coast of Sumatra coffee was regularly cultivated, according to one account, as early as 1783; but it was not until about 1800, that exportation began, with about 270,000 pounds. By 1840, exports were averaging 11,000,000 to 12,250,000 pounds per year. Official records of production date from 1852, in which year the figures were 16,714,000 pounds. Five years later the recorded yield was 25,960,000 pounds, the high-water mark of Sumatra production. The total output in 1860 was 21,400,000 pounds; and 22,275,000 pounds in 1870. The average from 1875 to 1879 was 17,408,000 pounds; and from 1895 to 1899, it was 7,589,000 pounds. The yield was 5,576,000 pounds in 1900; 1,360,000 in 1910; and 7,752,000 in 1915.

In Celebes, the first plants were set out about 1750; but seventy years later production was only some 10,000 pounds. This soon increased to half a million pounds; and from 1835 to 1852 the yield ran between 340,000 and 1,768,000 pounds. From 1875 to 1879, production averaged 2,176,000 pounds; from 1885 to 1889, 2,747,000 pounds; and from 1895 to 1899, 707,000 pounds. In 1900, it was 680,000 pounds; in 1910, 272,000 pounds; and in 1915, 272,000 pounds.

Planting under government control, largely with forced labor, has been the special feature of coffee cultivation in the Dutch East Indies. At first the government exercised what was practically a monopoly; but private planting was more and more permitted; and in the latter part of the nineteenth century, the amount of coffee produced on private plantations exceeded that raised by the government. The government has now entirely given up the business of coffee production.

The total production of coffee in Java, Sumatra, and Celebes, in 1920, in piculs of 136 pounds, was as follows:

DUTCH EAST INDIES' COFFEE PRODUCTION

Kind of Quantity Produced in Coffee Java Sumatra Celebes Total and Bali (piculs) (piculs) (piculs) (piculs) Liberica 14,972 6,243 2,074 23,289 Java 16,312 24,291 70,621 111,224 Robusta 411,235 256,645 4,998 672,878 ------- ------- ------ ------- Total 442,519 287,179 77,693 807,391

STRAITS SETTLEMENTS. Trade in coffee is a transhipping trade, Singapore acting as a clearing center for large quantities of coffee from the neighboring islands. In 1920, the imports were 25,914,267 pounds; and the exports, 26,856,000 pounds.

FEDERATED MALAY STATES. The acreage in coffee in the Federated Malay States is steadily declining. In 1903, coffee plantations covered 22,700 acres; in 1913, 7,695 acres; and in 1916, 4,312 acres. There was formerly a considerable export; but apparently local production is now required for home consumption, as in 1920 exports were practically nothing, and about 9,800 pounds were imported.

BRITISH NORTH BORNEO. Total exports of coffee have reached as high as 50,000 pounds, which was the figure in 1904; but they are much less now; being 5,973 pounds in 1915; 15,109 pounds in 1916; and 1,980 pounds in 1918.

SARAWAK. Previous to 1912, the exportation of coffee from Sarawak, was 20,000 to 45,000 pounds annually. In 1912, a coffee estate of 300 acres was abandoned, and since that time there have been no exports.

PHILIPPINES. Coffee raising was formerly one of the chief industries of the Philippines; but it has now greatly declined, partly because of the blight. Exports reached their highest point in 1883, when 16,805,000 pounds were shipped. Since then, they have fallen off steadily to nothing; and the islands are now importers, although still producing considerable for their own use. The area still under cultivation in 1920 was 2,700 acres; and the production in that year was given as 2,710,000 pounds, as compared with 1,580,000 pounds in 1919, and an average of 1,500,000 pounds for the previous five years.

GUAM. Coffee is a common plant on the island but is not systematically cultivated. There is no exportation, but a Navy Department report says that the possible export is not less than seventy-five tons annually.

HAWAII. A certain amount of coffee has been produced in the Hawaiian Islands for many years, exports being recorded as 49,000 pounds in 1861; as 452,000 pounds in 1870; and as 143,000 pounds in 1877. The trees grow on all the islands; but nearly all the coffee produced is raised on Hawaii. The trees are not carefully cultivated; but the coffee has an excellent flavor. The amount of land planted to coffee is about 6,000 acres. The exports go mostly to continental United States. The exports are increasing, the figures up to 1909 ranging usually between 1,000,000 and 2,000,000 pounds, and now usually running between 2,000,000 and 5,000,000 pounds. Including shipments to continental United States, Hawaii exported 5,775,825 pounds in 1918; 3,649,672 pounds in 1919; 2,573,300 pounds in 1920; and 4,979,121 pounds in 1921.

AUSTRALIA. Queensland is the only state of the Commonwealth in which coffee growing has been at all extensively tried; and here the results have, up to the present time, been far from satisfactory. The total area devoted to this crop reached its highest point in the season 1901-02 when an area of 547 acres was recorded. The area then continuously declined to 1906-07, when it was as low as 256 acres. In subsequent seasons the area fluctuated somewhat; but, on the whole, with a downward tendency. In 1919-20, only 24 productive acres were recorded, with a yield of 16,101 pounds. The country is now listed among the consuming rather than the producing countries.

ABYSSINIA. This country, usually credited with being the original home of the coffee plant, still has, in its southern part, vast forests of wild coffee whose extent is unknown, but whose total production is believed to be immense. It is of inferior grade, and reaches the market as "Abyssinian" coffee. There is also a large district of coffee plantations producing a very good grade called "Harari", which is considered almost, if not quite, the equal of the Arabian Mocha. This is usually shipped to Aden for re-export. Abyssinia's coffee reaches the outside world through three different gateways; and as the neighboring countries, through which the produce passes, also produce coffee, no accurate statistics are available to show the country's annual export. The total probably ranges from 10,000,000 to 20,000,000 pounds a year. Coffee was shipped from Abyssinia to the extent of 6,773,800 pounds in 1914, over the Franco-Ethiopian railroad; 10,054,000 pounds in 1915; and 9,064,000 pounds in 1916. Export figures of the port of Massowah include a large amount of Abyssinian coffee, but the proportion is unknown. At this port 108,680 pounds of coffee were exported in 1914; and 1,221,880 pounds in 1915. Abyssinian coffee exported by way of the Sudan amounted to 232,616 pounds in 1914; to 140,461 pounds in 1915; and to 4,164,600 pounds in 1916.

BRITISH EAST AFRICAN PROTECTORATE. The acreage in coffee has greatly increased in recent years. It was estimated at 1,000 acres in 1911; and by 1916, it had grown to 22,200 acres. Production, as shown by the exports, has likewise increased greatly; and exports in recent years have averaged about 8,000,000 pounds a year. They were 10,984,000 pounds in 1917; and were 18,735,000 pounds in 1918.

UGANDA PROTECTORATE. The acreage in coffee has been steadily increasing, as shown by the following figures: 1910, 697 acres; 1914, 19,278 acres; 1916, 23,857 acres; 1917, 22,745 acres. In 1909, 33,440 pounds of coffee were produced; and by 1918, this had grown to 10,000,000 pounds. The average for the five years, 1914-18, was 5,076,000 pounds.

NYASALAND PROTECTORATE. Twenty-five years ago, this colony exported coffee in amounts ranging from 300,000 to more than 2,000,000 pounds. Production has now so declined, that only 122,000 pounds were exported in 1918; and the average for recent years has been about 92,000 pounds. The acreage in bearing in 1903 was 8,234; and in 1917 it was 1,237.

NIGERIA. Production has been falling off in recent years. Exports were 35,000 pounds in 1896; 57,000 pounds in 1901; and 70,000 pounds in 1909. In 1916 and 1917, however, they were only about 3,000 pounds.

GOLD COAST. This colony formerly produced considerable coffee, exporting 142,000 pounds in 1896. There have been no exports in recent years, except about 440 pounds in 1916, and 660 pounds in 1917.

SOMALILAND PROTECTORATE. Exports of coffee were more than 7,500,000 pounds in 1897, indicating a very extensive production. But since then, there has been a steady decline; and in 1918 only about 440,000 pounds were shipped.

SOMALI COAST (FRENCH). Exports of coffee from this colony amounted to more than 5,000,000 pounds in 1902; and since then, they have remained fairly steadily at that figure, showing considerable increase in late years. Total exports in 1917 were 11,200,000 pounds.

ITALIAN SOMALILAND. Some coffee appears to be grown in this colony; but exports have been inconsiderable for many years.

SIERRA LEONE. Production has been steadily declining for twenty years. Exports were 33,376 pounds in 1903; 17,096 pounds in 1913; and 8,228 pounds in 1917.

MAURITIUS. In former times this island was an important coffee producer, exports in the early part of the nineteenth century running as high as 600,000 pounds. Today there is practically no export, and only about 30 acres are in bearing, producing 4,000 to 8,000 pounds a year.

REUNION. This island also was once a notable grower of coffee. A century ago, production was estimated as high as 10,000,000 pounds; and this rate of output continued well through the nineteenth century. In the present century, production has fallen off; and only about 530,000 pounds were exported in 1909. The decrease has continued, so that the average in recent years has been only about 25,000 pounds.

Coffee Consumption

Of the million or more tons of coffee produced in the world each year, practically all--with the exception of that which is used in the coffee-growing countries themselves--is consumed by the United States and western Europe, the British dominions, and the non-producing countries of South America. Over that vast stretch of territory beginning with western Russia, and extending over almost the whole of Asia, coffee is very little known. In the consuming regions mentioned, moreover, consumption is concentrated in a few countries, which together account for some ninety percent of all the coffee that enters the world's markets. These are, the United States, which now takes more than one-half, and Germany, France, Spain, Italy, Holland, Belgium, Switzerland, and Scandinavia.

The United Kingdom stands out conspicuously among the nations of western Europe as a small consumer of coffee, the per capita consumption in that country being only about two-thirds of a pound each year. France and Germany are by far the biggest coffee buyers of Europe so far as actual quantity is concerned; although some of the other countries mentioned drink much more coffee in proportion to the population. The Mediterranean countries and the Balkans are of only secondary importance as coffee drinkers. Among the British dominions, the Union of South Africa takes much the largest amount, doubtless because of the Dutch element in its population; while Canada, Australia, and New Zealand show the influence of the mother country, consumption per head in the last two being no greater than in England.

In South America, Brazil, Bolivia, and all the countries to the north, are coffee producers. Of the southern countries, Argentina is the chief coffee buyer, with Chile second. In the western hemisphere, however, the largest per capita coffee consumer is the island of Cuba, which raises some coffee of its own and imports heavily from its neighbors.

The list of coffee-consuming countries includes practically all those that do not raise coffee, and also a few that have some coffee plantations, but do not grow enough for their own use. These countries are listed on page 287. Consumption figures can be determined with fair accuracy by the import figures; although in some countries, where there is a considerable transit trade, it is necessary to deduct export from import figures to obtain actual consumption figures. The import figures given are the latest available for each country named.

GENERAL COFFEE CONSUMPTION TABLE

Country Year Imports Exports Consumption (pounds) (pounds) (pounds)

United States 1921[j] 1,345,366,943[k] 41,813,197[k] 1,303,553,746 Canada 1921[l] 17,517,353 20,349 17,497,004 Newfoundland 1920[l] 46,813[m] 46,813 United Kingdom 1921[j] 34,363,728[m] 34,360,128 France 1921[j] 322,419,884 1,154,769 321,265,115 Spain 1920 48,518,854 5,033 48,513,821 Portugal 1919[j] 6,926,575 1,258,271 5,668,304 Belgium 1921[j] 105,365,586 21,541,049 83,824,537 Holland 1921[j] 135,566,943 66,567,702 69,999,241 Denmark 1921[j] 46,571,954 3,449,537 43,122,417 Norway 1921[j] 29,835,544 169,921 29,665,623 Sweden 1921[j] 89,660,766 89,660,766 Finland 1921[j] 27,968,355 27,968,355 Russia 1916 9,801,014 9,801,014 Austria-Hungary 1917 17,966,167 56,217 17,909,950 (former) Austria 1921[n] 5,128,781 79,365 5,049,416 Germany (former) 1913 371,130,520 1,783,521 369,346,999 Germany (present) 1921[o] 167,675,258 210,535 167,464,723 Poland 1920 7,612,526 26,781 7,585,745 Bulgaria 1914 1,300,493 1,300,493 Rumania 1919 5,134,198 66,757 5,067,441 Greece 1920[p] 13,118,626 13,118,626 Switzerland 1921[j] 31,582,879 47,619 31,535,260 Italy 1920 66,509,255 14,330 66,494,925 Algeria 1920 17,273,041 17,273,041 Tunis 1920 3,458,018 3,458,018 Egypt 1921[j] 20,939,542 218,938 20,720,604 Union of S. Africa 1920 28,752,538 954,181[q] 27,798,357 Northern Rhodesia 1920 43,880 8,263 35,617 Southern Rhodesia 1920 325,900 10,064 315,836 Mozambique 1919 111,614 78,973 32,641 Ceylon 1920 1,853,537 2,240 1,851,297 China 1920 613,217 297,663 315,554 Japan 1920 684,826 684,826 Philippines 1920 3,475,530 26 3,475,504 Canary Islands 1917 529,104 529,104 Cyprus 1918 451,880 451,880 Australia 1920[l] 2,502,429 263,430[r] 2,238,999 New Zealand 1920 304,737 21,104 283,633 Cuba 1920[l] 39,983,001 1,305 39,981,696 Martinique 1918 335,099 10,362 324,737 Panama 1920 216,923 518 216,405 Argentina 1919 37,541,020 37,541,020 Chile 1920 12,357,929 12,357,929 Uruguay 1921[p] 4,896,507 4,896,507 Paraguay 1920 262,737 262,737

[j] Preliminary figures.

[k] Figures are for continental U.S. Imports include both foreign coffee and coffee from our Island possessions. Exports Include both foreign and domestic exports from continental U.S. and also exports to our island possessions.

[l] Fiscal year.

[m] Entered for home consumption.

[n] First six months. Imports in 1920 were 6,042,808 pounds; exports 93,034 pounds.

[o] Eight months, May-December.

[p] First eleven months.

[q] Exports of foreign coffee. Domestic exports were 48,463 pounds.

[r] Exports of foreign coffee. Domestic exports were 208,445 pounds.

On account of the very wide fluctuations in imports during the war and the period following the war, per capita figures of consumption are of only relative value, as they have naturally changed radically in recent years. For the most part, however, the trade has about swung back to normal; and per capita figures based on the amounts retained for consumption, as given in the General Coffee Consumption Table, are fairly close to those for the years before the war. As per capita calculations must take into account population as well as amounts of coffee consumed; and as population figures are usually estimates, the results arrived at by different authorities are likely to vary slightly, although usually they are not far apart. In figuring the per capita amounts in the table on page 288, latest available estimates of population have been used. The figures show that the following are the ten leading countries in the per capita consumption of coffee in pounds:

1. Sweden 15.25 6. Norway 10.95 2. Cuba 13.79 7. Holland 10.22 3. Denmark 13.19 8. Finland 8.25 4. United States 12.09 9. Switzerland 8.17 5. Belgium 11.06 10. France 7.74

The per capita consumption of the most important coffee-consuming countries, based on the large table, is given with the 1913 per capita figures for comparison:

PER CAPITA COFFEE CONSUMPTION TABLE

Country Year Pounds Pds., 1913

United States 1921 12.09 8.90[t] Canada 1921[s] 1.93 2.17[u] Newfoundland 1920[s] 0.19 0.19[t] United Kingdom 1921 0.72 0.61[t] France 1921 7.74 6.41 Spain 1920 2.33 1.64 Portugal 1919 0.86 1.16 Belgium 1921 11.06 12.27 Holland 1921 10.22 18.80 Denmark 1921 13.19 12.85 Norway 1921 10.95 12.29 Sweden 1921 15.25 13.41 Finland 1921 8.25 8.85 Russia 1916 0.05 0.16 Austria-Hungary 1917 0.34 2.54 Germany 1921 4.10 5.43 Roumania 1919 0.29 1.04 Greece 1920 2.97 1.19 Switzerland 1921 8.17 6.48 Italy 1920 1.84 1.79 Egypt 1921 1.53 1.15 Union of So. Africa 1920 3.80[v] 4.19[v] Ceylon 1920 0.43 0.36 China 1920 0.001 0.01 Japan 1920 0.01 0.004 Cuba 1920[s] 13.79 10.00 Argentina 1919 4.40 3.74 Chile 1920 3.06 3.04 Uruguay 1921 3.61 [w] Paraguay 1920 0.26 [w] Australia 1920[s] 0.42 0.64 New Zealand 1920 0.24 0.29

[s] Fiscal year.

[t] Fiscal year 1913.

[u] Fiscal year ending March 31, 1914.

[v] Including both white and colored population.

[w] Not available.

Tea and Coffee in England and the U. S.

The rise of the United States as a coffee consumer in the last century and a quarter has been marked, not only by steadily increased imports as the population of the country increased, but also by a steady growth in per capita consumption, showing that the beverage has been continually advancing in favor with the American people. Today it stands at practically its highest point, each individual man, woman, and child having more than 12 pounds a year, enough for almost 500 cups, allotted to him as his portion. This is four times as much as it was a hundred years ago; and more than twice as much as it was in the years immediately following the Civil War. In general it is fifty percent more than the average in the twenty years preceding 1897, in which year a new high level of coffee consumption was apparently established, the per capita figure for that year being 10.12 pounds, which has been approximately the average since then.

Since the advent of country-wide prohibition in the United States on July 1, 1919, about two pounds more coffee per person, or 80 to 100 cups, have been consumed than before. Part of this increase is doubtless to be charged to prohibition; but it is yet too early to judge fairly as to the exact effect of "bone-dry" legislation on coffee drinking. The continued growth in the use of coffee in the United States has been in decided contrast to the per capita consumption of tea, which is less now than half a century ago.

In the United Kingdom, the reverse condition prevails. Tea drinking there steadily maintains a popularity which it has enjoyed for centuries; while coffee apparently makes no advance in favor. In this respect, the country is sharply distinguished from its neighbors of western Europe, in many of which coffee drinking has been much heavier, considering the population, even than in the United States. The contrast between the tastes of the two countries in beverages is shown clearly by the per capita figures of tea and coffee consumption for half a century, as they appear in the table, next column.

TEA AND COFFEE CONSUMPTION PER CAPITA

Year United States United Kingdom Coffee Tea Coffee Tea pounds pounds pounds pounds 1866 4.96 1.17 1.02 3.42 1867 5.01 1.09 1.04 3.68 1868 6.52 .96 1.00 3.52 1869 6.45 1.08 .94 3.63 1870 6.00 1.10 .98 3.81 1871 7.91 1.14 .97 3.92 1872 7.28 1.46 .98 4.01 1873 6.87 1.53 .99 4.11 1874 6.59 1.27 .96 4.23 1875 7.08 1.44 .98 4.44 1876 7.33 1.35 .99 4.50 1877 6.94 1.23 .96 4.52 1878 6.24 1.33 .97 4.66 1879 7.42 1.21 .99 4.68 1880 8.78 1.39 .92 4.57 1881 8.25 1.54 .89 4.58 1882 8.30 1.47 .89 4.69 1883 8.91 1.30 .89 4.82 1884 9.26 1.09 .90 4.90 1885 9.60 1.18 .91 5.06 1886 9.36 1.37 .87 4.92 1887 8.53 1.49 .80 5.02 1888 6.81 1.49 .83 5.03 1889 9.16 1.25 .76 4.99 1890 7.77 1.32 .75 5.17 1891 7.94 1.28 .76 5.36 1892 9.59 1.36 .74 5.43 1893 8.23 1.32 .69 5.40 1894 8.01 1.34 .68 5.51 1895 9.24 1.39 .70 5.65 1896 8.08 1.32 .69 5.75 1897 10.04 1.56 .68 5.79 1898 11.59 .93 .68 5.83 1899 10.72 .97 .71 5.95 1900 9.84 1.09 .71 6.07 1901 10.43 1.12 .76 6.16 1902 13.32 .92 .68 6.07 1903 10.80 1.27 .71 6.04 1904 11.67 1.31 .68 6.02 1905 11.98 1.19 .67 6.02 1906 9.72 1.06 .66 6.22 1907 11.15 .96 .67 6.26 1908 9.82 1.03 .66 6.24 1909 11.43 1.24 .67 6.37 1910 9.33 .89 .65 6.39 1911 9.29 1.05 .62 6.47 1912 9.26 1.04 .61 6.49 1913 8.90 .96 .61 6.68 1914 10.14 .91 .63 6.89 1915 10.62 .91 .71 6.87 1916 11.20 1.07 .66 6.56 1917 12.38 .99 1.02 6.03 1918 10.43 1.40 1.19 6.75 1919 9.13 .87 .76 8.43 1920 12.78 .84 .74 8.51

Figures for all except most recent years are taken from the Statistical Abstract publications of the two countries. For the United States the figures given apply to fiscal years ending June 30, and for the United Kingdom to calendar years.

Coffee Consumption in Europe

On the continent of Europe, however, coffee enjoys much the same sort of popularity that it does in the United States. The leading continental coffee ports are Hamburg, Bremen, Copenhagen, Amsterdam, Rotterdam, Antwerp, Havre, Bordeaux, Marseilles, and Trieste; and the nationalities of these ports indicate pretty well the countries that consume the most coffee. The northern ports are transhipping points for large quantities of coffee going to the Scandinavian countries, as well as importing ports for their own countries; and these countries have been among the leading coffee drinkers, per head of population, for many decades. Norway, for instance, in 1876 was consuming about 8.8 pounds of coffee per person; Sweden, 5 pounds; and Denmark, 5.2 pounds. The per capita consumption of various other countries at about the same period, 1875 to 1880, has been estimated as follows: Holland, 17.6 pounds; Belgium, 9.1 pounds; Germany, 5.1 pounds; Austria-Hungary, 2.2 pounds; Switzerland, 6.6 pounds; Prance, 3 pounds; Spain, 0.2 pounds; Portugal, 0.7 pounds; and Greece, 1.6 pounds.

Today, the leading country of the world in point of per capita consumption is Sweden (15.25 pounds); but Holland held that position for a long while. During the World War the disturbance of trade currents, and the high price of coffee, greatly reduced the amount of coffee drinking; and the Dutch took to drinking tea in considerable quantities.

FRANCE. Second only to the United States, in the total amount of coffee consumed, is France; although that country before the war occupied third place, being passed by Germany. Havre is one of the great coffee ports of Europe; and has a coffee exchange organized in 1882, only a short time after the Exchange in New York began operations. France draws on all the large producing regions for her coffee; but is especially prominent in the trade in the West Indies and the countries around the Caribbean Sea. Imports in 1921 (preliminary) amounted to 322,419,884 pounds; exports to 1,154,769 pounds; and net consumption, to 321,265,115 pounds.

GERMANY. Hamburg is one of the world's important coffee ports; and in normal times coffee is brought there in vast amounts, not only for shipment into the interior of Germany, but also for transhipment to Scandinavia, Finland and Russia. Up to the outbreak of the war, Germany was the chief coffee-drinking country of Europe. During the blockade, the Germans resorted to substitutes; and after the war because of high prices, there was still some consumption of them. German coffee imports since the war have not quite climbed back to their former high mark; and the per capita consumption, judged by these figures is still somewhat low. Importations amounted to 90,602,000 pounds in 1920. The amount of total imports was 371,130,520 pounds in 1913; total exports, 1,783,521 pounds; and net imports, 369,346,999 pounds.

NETHERLANDS. Netherlands is one of the oldest coffee countries of Europe, and for centuries has been a great transhipping agent, distributing coffee from her East Indian possessions and from America among her northern neighbors. Before sending these coffee shipments along, however, she kept back enough plentifully to supply her own people, so that for many years before the war she led the world in per capita consumption. As far back as 1867-76, coffee consumption was averaging more than 13 pounds per capita. In the year before the war, the average was 18.8 pounds. The blockade, and other abnormal conditions during the war, threw the trade off; and it is still sub-normal. In 1920 the net imports were about 96,000,000 pounds, which would give a per capita consumption of about 14 pounds if it all went into consumption. But part of it was probably stored for later exportation, as indicated by the figures for 1921, which show heavy exports and a consequent lower figure for consumption. Eighty percent of the Netherlands coffee trade is handled through Amsterdam.

Consumption of coffee is now slowly going back to normal, but the change in source of imports--which before the war came largely from Brazil but which war conditions turned heavily toward the East Indies--is still in evidence. Per capita consumption of coffee in Holland up to the outbreak of the war was as follows:

COFFEE CONSUMPTION PER CAPITA IN HOLLAND

Year Pounds Year Pounds 1847-56 9.6 1907 14.9 1857-66 7.1 1908 14.3 1867-76 13.3 1909 16.7 1877-86 16.7 1910 15.7 1887-96 12.8 1911 15.8 1897-1906 16.7 1912 12.3 1906 17.2 1913 18.8

OTHER COUNTRIES OF EUROPE. Denmark, Norway, and Sweden are all heavy coffee drinkers. In 1921 Sweden had the highest per capita consumption in the world, 15.25 pounds. Before the war, these three countries each consumed about as much per capita as the United States does today, 12 to 13 pounds. The 1921 imports for consumption[317] were as follows: Denmark, 43,122,417 pounds; Norway, 29,665,623 pounds; Sweden, 89,660,766 pounds. Austria-Hungary was formerly an important buyer of coffee, large quantities coming into the country yearly through Trieste. Imports in 1913 totaled 130,951,000 pounds; and in 1912, 124,527,000 pounds. In 1917 the war cut down the total to 17,910,000 pounds net consumption. Finland shares with her neighbors of the Baltic a strong taste for coffee, importing, in 1921, 27,968,000 pounds, about 8.25 pounds per capita. In the same year, Belgium had a net importation of 83,824,000 pounds.

Spain, in 1920, consumed 48,513,821 pounds. Portugal, in 1919, imported 6,926,575 pounds; and exported 1,258,271 pounds, leaving 5,668,304 pounds for home consumption. Coffee is not especially popular in the Balkan States and Italy; importations into the last-named country in 1920 amounting to 66,494,925 pounds net. Switzerland is a steady coffee drinker, consuming 31,535,260 pounds in 1921. Russia was never fond of coffee; and her total imports in 1917, according to a compilation made under Soviet auspices, were only 4,464,000 pounds.

OTHER COUNTRIES. The Union of South Africa, in 1920, imported 27,798,000 pounds net, or about 3.8 pounds per capita. Cuba purchased 39,981,696 pounds in the fiscal year 1920; Argentina, 37,541,000 pounds in 1919; Chile, 12,358,000 pounds in 1920; Australia, 2,239,000 pounds in 1920; and New Zealand, 283,633 pounds in that year.

Three Centuries of Coffee Trading

The story of the development of the world's coffee trade is a story of about three centuries. When Columbus sailed for the new world, the coffee plant was unknown even as near its original home as his native Italy. In its probable birthplace in southern Abyssinia, the natives had enjoyed its use for a long time, and it had spread to southwestern Arabia; but the Mediterranean knew nothing of it until after the beginning of the sixteenth century. It then crept slowly along the coast of Asia Minor, through Syria, Damascus, and Aleppo, until it reached Constantinople about 1554. It became very popular; coffee houses were opened, and the first of many controversies arose. But coffee made its way against all opposition, and soon was firmly established in Turkish territory.

In those deliberate times, the next step westward, from Asia to Europe, was not taken for more than fifty years. In general, its introduction and establishment in Europe occupied the whole of the seventeenth century.

The greatest pioneering work in coffee trading was done by the Netherlands East India Company, which began operations in 1602. The enterprise not only promoted the spread of coffee growing in two hemispheres; but it was active also in introducing the sale of the product in many European countries.

Coffee reached Venice about 1615, and Marseilles about 1644. The French began importing coffee in commercial quantities in 1660. The Dutch began to import Mocha coffee regularly at Amsterdam in 1663; and by 1679 the French had developed a considerable trade in the berry between the Levant and the cities of Lyons and Marseilles. Meanwhile, the coffee drink had become fashionable in Paris, partly through its use by the Turkish ambassador, and the first Parisian cafe was opened in 1672. It is significant of its steady popularity since then that the name cafe, which is both French and Spanish for coffee, has come to mean a general eating or drinking place.

Active trading in coffee began in Germany about 1670, and in Sweden about 1674.

Trading in coffee in England followed swiftly upon the heels of the opening of the first coffee house in London in 1652. By 1700, the trade included not only exporting and importing merchants, but wholesale and retail dealers; the latter succeeding the apothecaries who, up to then, had enjoyed a kind of monopoly of the business.

Trade and literary authorities[318] on coffee trading tell us that in the early days of the eighteenth century the chief supplies of coffee for England and western Europe came from the East Indies and Arabia. The Arabian, or--as it was more generally known--Turkey berry, was bought first-hand by Turkish merchants, who were accustomed to travel inland in Arabia Felix, and to contract with native growers.

It was moved thence by camel transport through Judea to Grand Cairo, via Suez, to be transhipped down the Nile to Alexandria, then the great shipping port for Asia and Europe. By 1722, 60,000 to 70,000 bales of Turkish (Arabian) coffee a year were being received in England, the sale price at Grand Cairo being fixed by the Bashaw, who "valorized" it according to the supply. "Indian" coffee, which was also grown in Arabia, was brought to Bettelfukere (Beit-el-fakih) in the mountains of southwestern Arabia, where English, Dutch, and French factors went to buy it and to transport it on camels to Moco (Mocha), whence it was shipped to Europe around the Cape of Good Hope.

In the beginning, "Indian" coffee was inferior to Turkish coffee; because it was the refuse, or what remained after the Turkish merchants had taken the best. But after the European merchants began to make their own purchases at Bettelfukere, the character of the "Indian" product as sold in the London and other European markets was vastly improved. Doubtless the long journey in sailing vessels over tropic seas made for better quality. It was estimated that Arabia in this way exported about a million bushels a year of "Turkish" and "Indian" coffee.

The coffee houses became the gathering places for wits, fashionable people, and brilliant and scholarly men, to whom they afforded opportunity for endless gossip and discussion. It was only natural that the lively interchange of ideas at these public clubs should generate liberal and radical opinions, and that the constituted authorities should look askance at them. Indeed the consumption of coffee has been curiously associated with movements of political protest in its whole history, at least up to the nineteenth century.

Coffee has promoted clear thinking and right living wherever introduced. It has gone hand in hand with the world's onward march toward democracy.

As already told in this work, royal orders closed the coffee houses for short periods in Constantinople and in London; Germany required a license for the sale of the beverage; the French Revolution was fomented in coffee-house meetings; and the real cradle of American liberty is said to have been a coffee house in New York. It is interesting also to note that, while the consumption of coffee has been attended by these agitations for greater liberty for three centuries, its production for three centuries, in the Dutch East Indies, in the West Indies, and in Brazil, was very largely in the hands of slaves or of forced labor.

Since the spread of the use of coffee to western Europe in the seventeenth century, the development of the trade has been marked, broadly speaking, by two features: (1) the shifting of the weight of production, first to the West Indies, then to the East Indies, and then to Brazil; and (2) the rise of the United States as the chief coffee consumer of the world. Until the close of the seventeenth century, the little district in Arabia, whence the coffee beans had first made their way to Europe, continued to supply the whole world's trade. But sprigs of coffee trees were beginning to go out from Arabia to other promising lands, both eastward and westward. As previously related, the year 1699 was an important one in the history of this expansion, as it was then that the Dutch successfully introduced the coffee plant from Arabia into Java. This started a Far Eastern industry, whose importance continues to this day, and also caused the mother country, Holland, to take up the role of one of the leading coffee traders of the world, which she still holds. Holland, in fact, took to coffee from the very first. It is claimed that the first samples were introduced into that country from Mocha in 1616--long before the beans were known in England or France--and that by 1663, regular shipments were being made. Soon after the coffee culture became firmly established in Java, regular shipments to the mother country began, the first of these being a consignment of 894 pounds in 1711. Under the auspices of the Netherlands East India Co. the system of cultivating coffee by forced labor was begun in the East Indian colonies. It flourished until well into the nineteenth century. One result of this colonial production of coffee was to make Holland the leading coffee consumer per capita of the world, consumption in 1913, as recorded on page 290, having reached as high as 18.8 pounds. It has long been one of the leading coffee traders, importing and exporting in normal times before the war between 150,000,000 and 300,000,000 pounds a year.

The introduction of the coffee plant into the new world took place between 1715 and 1723. It quickly spread to the islands and the mainland washed by the Caribbean. The latter part of the eighteenth century saw tens of millions of pounds of coffee being shipped yearly to the mother countries of western Europe; and for decades, the two great coffee trade currents of the world continued to run from the West Indies to France, England, Holland, and Germany; and from the Dutch East Indies to Holland. These currents continued to flow until the disruption of world trade-routes by the World War; but they had been pushed into positions of secondary importance by the establishing of two new currents, running respectively from Brazil to Europe, and from Brazil to the United States, which constituted the nineteenth century's contribution to the history of the world's coffee trade.

The chief feature of the twentieth century's developments has been the passing by the United States of the half-way mark in world consumption; this country, since the second year of the World War, having taken more than all the rest of the world put together. The world's chief coffee "stream," so to speak, is now from Santos and Rio de Janeiro to New York, other lesser streams being from these ports to Havre, Antwerp, Amsterdam, and (in normal times) Hamburg; and from Java to Amsterdam and Rotterdam. It is said that a movement, fostered by Belgium and Brazil, is under way to have Antwerp succeed Hamburg as a coffee port.

The rise of Brazil to the place of all-important source of the world's coffee was entirely a nineteenth century development. When the coffee tree found its true home in southern Brazil in 1770, it began at once to spread widely over the area of excellent soil; but there was little exportation for thirty or forty years. By the middle of the nineteenth century Brazil was contributing twice as much to the world's commerce as her nearest competitor, the Dutch East Indies, exports in 1852-53 being 2,353,563 bags from Brazil and 1,190,543 bags from the Dutch East Indies. The world's total that year was 4,567,000 bags, so that Brazilian coffee represented about one-half of the total. This proportion was roughly maintained during the latter half of the nineteenth century, but has gradually increased since then to its present three-fourths.

The most important single event in the history of Brazilian production was the carrying out of the valorization scheme, by which the State of Sao Paulo, in 1906 and 1907, purchased 8,474,623 bags of coffee, and stored it in Santos, in New York, and in certain European ports, in order to stabilize the price in the face of very heavy production. At the same time, a law was passed limiting the exports to 10,000,000 bags per year. This law has since been repealed. The story of valorization is told more fully in chapter XXXI. The coffee thus purchased by the state was placed in the hands of an international committee, which fed it into the world's markets at the rate of several hundred thousand bags a year. Good prices were realized for all coffee sold; and the plan was successful, not only financially, but in the achievement of its main object, the prevention of the ruin of planters through overproduction.

Another valorization campaign was launched by Brazil in 1918, and a third in 1921. Early in 1918, the Sao Paulo government bought about 3,000,000 bags. Subsequent events caused a sharp advance in prices, and at one time it was said that the holdings showed a profit of $60,000,000. The Brazil federal government appointed an official director of valorization, Count Alexandre Siciliano. A federal loan of L9,000,000, with 4,535,000 bags of valorized coffee as collateral, was placed in London and New York in May, 1922.

European consumption during the last century has been marked by the growth of imports into France and Germany; these being the two leading coffee drinkers of the world, aside from the United States. Germany held the lead in European consumption during the whole of the nineteenth century, and also in this century until all imports were stopped by the Allied navies; although, in actual imports, Holland for many years showed higher figures. Both Holland and England have acted as distributers, re-exporting each year most of the coffee which entered their ports. In the last half-century, the chief consumers, in the order named, have been Germany, France, Holland, Austria-Hungary, and Belgium. However, with the removal of the duty on coffee in the last-named country in 1904, imports trebled; and Belgium took third place. The table at the top of this page shows the general trend of the trade for the last seventy years.

TREND OF EUROPEAN COFFEE CONSUMPTION FOR SEVENTY YEARS

Year Germany France Holland Aus.-Hung. Belgium (pounds) (pounds) (pounds) (pounds) (pounds) 1853 104,049,000 48,095,000 46,162,000 44,716,000 41,270,000 1863 146,969,000 87,524,000 30,299,000 44,966,000 39,305,000 1873 215,822,000 98,841,000 79,562,000 71,111,000 49,874,000 1883 251,706,000 150,468,000 130,380,000 74,145,000 62,846,000 1893 269,381,000 152,203,000 75,562,000 79,438,000 52,046,000 1903 403,070,000 246,122,000 78,328,000 104,200,000 51,859,000 1913 369,347,000 254,102,000 116,749,000 130,951,000 93,250,000

Most of the coffee for these countries has for many years been supplied by Brazil, even Holland bringing in several times as much from Brazil as from the Dutch East Indies. Special features of the European trade have been the organization, in 1873, and successful operation, in Germany, of the world's first international syndicate to control the coffee trade; and the opening of coffee exchanges in Havre in 1882, in Amsterdam and Hamburg, in 1887: in Antwerp, London, and Rotterdam, in 1890; and in Trieste in 1905.

The advance of coffee consumption in the United States, the chief coffee-consuming country in the world, has taken place through about the same period as the advance of production in Brazil, the chief producing country; but it has been far less rapid. From 1790 to 1800, coffee imports for consumption ranged from 3,500,000 to 32,000,000 pounds. The figures in the next column show the net importations of coffee into this country since the beginning of the nineteenth century.

The chief source of supply, of course, has been Brazil; and the commercial and economic ties created by this immense coffee traffic has knit the two countries closely together. Brazil is probably more friendly to the United States than any other South American country, as shown by her action in following this country into the World War against Germany. She also grants the United States certain tariff preferentials as a recognition of the continued policy of this country of admitting coffee free of duty. The chief port of entry of coffee into the United States is New York, which for decades has recorded entries amounting from sixty to ninety percent of the country's total. Since 1902, New Orleans has shown a big advance, and in 1910 imported some thirty-five percent of the total. The only other port of importance is San Francisco, where imports have been increasing in recent years because of the growth of the trade in Central American coffee.

COFFEE IMPORTS, UNITED STATES, FOR 120 YEARS Net Imports

Year Pounds Year Pounds 1800[x] 8,792,472 1906 804,808,594 1811[x] 19,801,230 1907 935,678,412 1821[x] 11,886,063 1908 850,982,919 1830[x] 38,363,687 1909 1,006,975,047 1840[x] 86,297,761 1910 813,442,972 1850 129,791,466 1911 869,489,902 1860 182,049,527 1912 880,838,776 1870 231,173,574 1913 859,166,618 1880 440,128,838 1914 991,953,821 1890 490,161,900 1915 1,051,716,023 1900 748,800,771 1916 1,131,730,672 1901 809,036,029 1917 1,267,975,290 1902 1,056,541,637 1918 1,083,480,622 1903 867,385,063 1919 968,297,668 1904 960,878,977 1920 1,364,252,073 1905 991,160,207 1921 1,309,010,452

[x] Fiscal year ending Sept. 30; all other years end June 30.

Throughout the century and a third of steady increase of importations of coffee, Congress has for the most part permitted its free entry; as a rule, resorting to taxation of "the poor man's breakfast cup" only when in need of revenue for war purposes. At times, the free entry has been qualified; but for the most part, coffee has been free from the burden of customs tariff.

The country's coffee trade before the Civil War was without special incident; but since that time, the continued growth has brought about manipulations that have often resulted in highly dramatic crises; organizations to exercise some sort of regulation in the trade; the development of a trade in substitutes; the advance of the sale of branded package coffee; the institution of large advertising campaigns; and other interesting features. These are treated more in detail in chapters that follow.

Coffee Drinking in the United States

Is the United States using more coffee than formerly, allowing for the increase in population? Of course there are sporadic increases, in particular years and groups of years, and they may indicate to the casual observer that our coffee drinking is mounting rapidly. And then there is the steadily growing import figure, double what it was within the memory of a man still young.

But the apparent growth in any given year is a matter of comparison with a nearby year, and there are declines as well as jumps; and, as for the gradual growth, it must always be remembered that, according to the Census Bureau, some 1,400,000 more people are born into this country every year, or enter its ports, than are removed by death or emigration. At the present rate this increase would account for about 17,000,000 pounds more coffee each year than was consumed in the year before.

The question is: Do Mr. Citizen, or Mrs. Citizen, or the little Citizens growing up into the coffee-drinking age, pass his or her or their respective cups along for a second pouring where they used to be satisfied with one, or do they take a cup in the evening as well as in the morning, or do they perhaps have it served to them at an afternoon reception where they used to get something else? In other words, is the coffee habit becoming more intensive as well as more extensive?

There are plenty of very good reasons why it should have become so in the last twenty-five or thirty years; for the improvements in distributing, packing, and preparing coffee have been many and notable. It is a far cry these days from the times when the housewife snatched a couple of minutes amid a hundred other kitchen duties to set a pan over the fire to roast a handful of green coffee beans, and then took two or three more minutes to pound or grind the crudely roasted product into coarse granules for boiling.

For a good many years, the keenest wits of the coffee merchants, not only of the United States but of Europe as well, have been at work to refine the beverage as it comes to the consumer's cup; and their success has been striking. Now the consumer can have his favorite brand not only roasted but packed air-tight to preserve its flavor; and made up, moreover, of growths brought from the four corners of the earth and blended to suit the most exacting taste. He can buy it already ground, or he can have it in the form of a soluble powder; he can even get it with the caffein element ninety-nine percent removed. It is preserved for his use in paper or tin or fiber boxes, with wrappings whose attractive designs seem to add something in themselves to the quality. Instead of the old coffee pot, black with long service, he has modern shining percolators and filtration devices; with a new one coming out every little while, to challenge even these. Last but not least, he is being educated to make it properly--tuition free.

It would be surprising, with these and dozens of other refinements, if a far better average cup of coffee were not produced than was served forty years ago, and if the coffee drinker did not show his appreciation by coming back for more.

As a matter of fact, the figures show that he does come back for more. We do not refer to the figures of the last two years, which indeed are higher than those for many preceding years, but to the only averages that are of much significance in this connection; namely, those for periods of years going back half a century or more. Five-year averages back to the Civil War show increasing per capita consumption for continental United States (see table).

FIVE-YEAR PER CAPITA CONSUMPTION FIGURES

_Five-year Per capita Five-year Per capita Period Pounds Period Pounds_

1867-71 6.38 1897-1901 10.52 1872-76 7.03 1902-06 11.50 1877-81 7.53 1907-11 10.21 1882-86 9.09 1912-16 10.02 1887-91 8.07 1917-21 11.39 1892-96 8.63

It will be seen that the gain has been a decided one, fairly steady, but not exactly uniform. In the fifty years, John Doe has not quite come to the point where he hands up his cup for a second helping and keeps a meaningful silence. Instead, he stipulates, "Don't fill it quite full; fill it about five-sixths as full as it was before." That is a substantial gain, and one that the next fifty years can hardly be expected to duplicate, in spite of the efforts of our coffee advertisers, our inventors, and our vigorous importers and roasters.

The most striking feature of this fifty-year growth was the big step upward in 1897, when the per capita rose two pounds over the year before and established an average that has been pretty well maintained since. Something of the sort may have taken place again in 1920, when there was a three-pound jump over the year before. It will be interesting to see whether this is merely a jump or a permanent rise; whether our coffee trade has climbed to a hilltop or a plateau.

In this connection it should be noted that the government's per capita coffee figures apply only to continental United States, and that in computing them all the various items of trade of the non-contiguous possessions (not counting the Philippines, whose statistics are kept entirely separate from those of the United States proper) are carefully taken into account.

But for the benefit of students of coffee figures it should be added that this method does not result in a final figure except for one year in ten. The reason is that between censuses the population of the country is determined only by estimates; and these estimates (by the U.S. Bureau of the Census) are based on the average increase in the preceding census decade. The increase between 1910 and 1920, for instance, is divided by 120, the number of months in the period, and this average monthly increase is assumed to be the same as that of the current year and of other years following 1920. Until new figures are obtained in 1930, the monthly increase will continue to be estimated at the same rate as the increase from 1910 to 1920, or about 118,000. This figure will be used in computing the per capita coffee consumption. But when the 1930 figures are in, it may be found that the estimates were too low or too high, and the per capita figures for all intervening years will accordingly be subject to revision. This will not amount to much, probably five-hundredths of a pound at most; but it is evident that between 1920 and 1930 all per capita consumption figures issued by the government are to be considered as provisional to that extent at least.

In the 1920 Statistical Abstract the government has revised its per capita coffee and tea figures to conform to actual instead of estimated population figures between 1910 and 1920, with the result that these figures are slightly different from those published in previous editions of the Abstract. Figures from 1890 to 1910 have also been slightly changed, as they were originally computed by using population figures as of June 1, whereas it is desirable to have computations based on July 1 estimates to make them conform to present per capita figures.

Reviewing the 1921 Trade in the United States

According to the latest available foreign trade summaries issued by the government, the United States bought more coffee in 1921 than in any previous calendar year of our history, although the total imports did not quite reach the highest fiscal-year mark. Our purchases passed the 1920 mark by more than 40,000,000 pounds and were higher than those of two years ago by 3,500,000 pounds.

But this record was made only in actual amounts shipped, as the value of imported coffee was far below that of immediately preceding years. Coffee values, however, fell off less than the average values for all imports, the decrease for coffee being forty-three percent and for the country's total imports fifty-two percent.

Exports of coffee were somewhat less in quantity than in 1920, and about the same as in 1919; although the value, like that of imports, was considerably less than in either previous year.

Re-exports of foreign coffee were considerably below the 1920 mark, in both quantity and value, and indeed were less than in several years. The amount of tea re-exported to foreign countries was only about half that shipped out in 1920, showing a continuation of the tendency of the United States to discontinue its services as a middleman, which raised the through traffic in tea several million pounds during the dislocation of shipping.

Actual figures of amounts and values of gross coffee imports for the three calendar years, 1919-1921, have been as follows:

Pounds Value 1921 1,340,979,776 $142,808,719 1920 1,297,439,310 252,450,651 1919 1,337,564,067 261,270,106

This represents a gain of three and three-tenths percent over 1920 in quantity and of only about one-fifth of one percent over 1919. The decrease in value in 1921 was forty-three percent from the figures for 1920 and forty-five percent from those of 1919.

Domestic exports of coffee, mostly from Hawaii and Porto Rico, amounted to 34,572,967 pounds valued at $5,895,606, as compared with 36,757,443 pounds valued at $9,803,574 in the calendar year 1920, or a decrease of six percent in quantity and forty percent in value. In 1919 domestic exports were 34,351,554 pounds, having a value of $8,816,581, practically the same in quantity, but showing a falling off of thirty-three percent in value.

Re-exports of foreign coffee amounted to 36,804,684 pounds in 1921, having a value of $3,911,847, a decline of twenty-five percent from the 49,144,691 pounds of 1920 and of fifty-four percent from the 81,129,691 pounds of 1919; whereas in point of value there was a decrease of fifty-six percent from 1920, which was $9,037,882, and of eighty-eight percent from that of 1919, which was $16,815,468.

The average value per pound of the imported coffee, according to these figures, works out at little more than half that of either 1920 or 1919, illustrating the precipitate drop of prices when the depression came on. The pound value in 1921 was 10.6c.; for 1920, 19.4c.; and for 1919, 19.5c. These values are derived from the valuations placed on shipments at the point of export, the "foreign valuation" for which the much discussed "American valuation" is proposed as a substitute. They accordingly do not take into account costs of freight, insurance, etc.

It is interesting to note that the average valuation of 10.6c. a pound for coffee shipped during the calendar year is a substantial drop from the 13.12c. a pound that was the average for the fiscal year 1921, showing that the decline in values continued during the last half of the calendar year.

Coffee imports in 1921 continued to run in about the same well-worn channels as in previous years, according to the figures showing the trade with the producing countries. The United States, as heretofore, drew almost its whole supply from its neighbors on this side of the globe; the countries to the south furnishing ninety-seven percent of the total entering our ports. The three chief countries of South America contributed eighty-five percent; and the share of Brazil alone was sixty-two and five-tenths percent.

Brazil's progress to her normal pre-war position in our coffee trade is rather slow, although she continues to show a gain in percentage each year. Formerly we obtained seventy percent to seventy-five percent of our coffee from that country; but war conditions, diverting nearly all of Central America's production to our ports, reduced the proportion to almost half. In 1919 this had risen to fifty-nine percent, in 1920 it was somewhat over sixty percent, and in 1921 it attained a mark of sixty-two and five-tenths percent. The actual amount shipped, which was 839,212,388 pounds having a value of $77,186,271, was about seven percent higher than in 1920, which was 785,810,689 pounds valued at $148,793,593; and about the same percent higher than that of 1919--787,312,293 pounds valued at $160,038,196. Although the actual poundage showed an increase, it will be noted that the value fell off almost one-half as compared with 1920, and more than one-half as compared with the year before.

The real feature of the year, and perhaps the most interesting development in the coffee trade of this country in recent years, is the steady advance of Colombian coffee.

In the year before the war, we obtained from our nearest South American neighbor 87,176,477 pounds of coffee valued at $11,381,675, which was about ten percent of our total imports. In 1919, the first year after the war, this amount was almost doubled, being 150,483,853 pounds with a value of $30,425,162. In 1920, there was a further increase to 194,682,616 pounds valued at $41,557,669, and in 1921 the high mark of 249,123,356 pounds valued at $37,322,305 was reached. This was a gain of twenty-eight percent over 1920 shipments; and, although the value was less than in the year before, the decrease was only ten percent in a year when the average fall in value was forty-three percent.

It will be news to many people interested in the coffee trade that the value of Colombian coffee now imported into the United States is almost half the value of the Brazilian coffee--$37,000,000 as compared with $77,000,000. The number of pounds imported is a little less than one-third the Brazilian contribution; but at the present rate of increase, it will pass the half mark in a few years.

Colombia and Venezuela together now supply considerably more than half as much coffee as Brazil in value, and more than one-third as much in quantity. The average value of Colombian coffee in 1921 was about fifteen cents a pound, as compared with eleven cents for Venezuelan, nine cents for Brazilian, ten cents for Central American, and ten and six-tenths cents for total coffee imports.

Shipments from Venezuela showed a drop in quantity of nine percent as compared with 1920 imports, being 59,783,303 pounds valued at $6,798,709; in 1920 they were 65,970,954 pounds valued at $13,802,995; and in 1919, they were 109,777,831 pounds valued at $23,163,071.

The figures relating to imports from Central America are of interest as showing to what extent we are continuing to hold the trade of the war years, when nearly all coffee shipped from that region came to the United States. Although there has probably been a considerable swing back to the trade with Europe, the 1921 figures show that a large percent of the trade that this country gained during the war is being retained. Imports in 1921 were considerably lower than in 1920 or in 1919, but were still more than three times as heavy as in 1913, the last year of normal trade.

The displacement of Central America's trade by the war, and the extent to which it has so far returned to old channels, are illustrated in the table of Imports into the United States from Central America in the last nine years on page 301.

As Germany was very prominent in pre-war trade, it is likely that more and more coffee will be diverted from the United States as German imports gradually increase to their old level.

IMPORTS INTO THE UNITED STATES FROM CENTRAL AMERICA

Year Pounds Value 1913 36,326,440 $4,635,359 1914 44,896,856 5,465,893 1915 71,361,288 8,093,532 1916 111,259,125 12,775,921 1917 148,031,640 15,751,761 1918 195,259,628 19,234,198 1919 131,638,695 19,375,179 1920 159,204,341 30,388,567 1921 118,607,382 12,308,250

Imports from Mexico in 1921 were greater by thirty-eight percent than in 1920, but were less than in 1919, and were still much below the normal trade before the war. The total was 26,895,034 pounds having a value of $3,475,122, as compared with 19,519,865 pounds valued at $3,873,217 in the year before, and with 29,567,469 pounds valued at $5,434,884 in 1919. The imports in 1913 were more than 40,000,000 pounds, in 1914 more than 43,000,000 pounds, and in 1915 more than 52,000,000 pounds.

West Indian coffees showed a gradual settling back to pre-war figures, which ranged from 3,000,000 to 12,000,000 pounds annually, but which in 1918, the last year of the war, leaped to 52,000,000 pounds. In 1919 they amounted to 42,013,841 pounds valued at $7,575,051; and in 1920, fell to 29,204,674 pounds valued at $5,711,993. In 1921 they continued to drop, the total being 15,398,073 pounds valued at $1,518,784, a decrease of forty-seven and three-tenths percent in quantity.

The year under review showed practically a return to normal for importations from Aden, which up to 1917 ran about 3,000,000 pounds a year. In that year the full effects of the war were felt in the Aden district, and shipments of coffee to this country dropped to 187,817 pounds. They rose to 432,000 pounds in 1918; and in 1919, to 681,290 pounds valued at $141,391. In 1920 there was a further rise to 889,633 pounds valued at $200,505; and in 1921 they amounted to 2,799,824 pounds valued at $476,672. But this trade is of little importance compared with that of the producing countries of this hemisphere, being less than one percent of our total imports.

Imports from the Dutch East Indies continued to decline, being fifty-five percent less than in 1920. The total of 12,438,016 pounds, however, valued at $1,771,602, is still two or three times the normal pre-war importations.

Exports of coffee in 1921--33,389,805 pounds of green coffee valued at $5,590,318 and 1,183,162 pounds of roasted valued at $305,288--were about the same as those of the year before in quantity, although much lower in value. The 1920 shipments were 34,785,574 pounds valued at $9,223,966 of green coffee and 1,971,869 pounds of roasted valued at $579,608.

In the re-export trade, shipments of coffee were lower than in several years, total amounts for 1921, 1920, and 1919 being 36,804,684 pounds, 49,144,091 pounds, and 81,129,641 pounds, and total values $3,911,847, $9,037,882, and $16,815,468.

PERCENTAGE OF TOTAL COFFEE IMPORTS INTO UNITED STATES

Percentage of increase (+) or decrease (-) of 1921 imports compared 1919 1920 1921 with 1920. / \ / \ / \ From Quantity Value Quantity Value Quantity Value Quantity Value Central America 9.80 7.40 12.30 12.00 8.80 8.60 -25.50 -50.00 Mexico 2.20 2.10 1.50 1.50 2.00 2.40 +37.80 -10.30 West Indies 3.10 2.90 2.20 2.20 1.10 1.00 -47.30 -73.40 Brazil 58.80 61.30 60.50 58.90 62.50 54.00 +6.80 -48.10 Colombia 11.20 11.60 15.00 16.40 18.50 26.10 +28.00 -10.20 Venezuela 8.20 8.90 5.10 5.10 4.40 4.80 -9.30 -50.70 Aden 0.05 0.05 0.07 0.08 0.20 0.30 214.80 +137.70 Dutch East Indies 4.20 3.80 2.10 2.00 0.90 1.20 -55.70 -65.40 Other countries 2.45 1.95 1.23 1.52 1.60 1.60 ... ... ------ ------ ------ ------ ------ ------ ------- ------- Total 100.00 100.00 100.00 100.00 100.00 100.00 +3.40 -43.40

Re-exports to France fell off from 16,760,977 pounds in 1920 to 11,429,952 in 1921. Mexico took 3,236,245 pounds as compared with 9,892,639 in the previous year, and Cuba also reduced her purchases from 6,319,105 pounds to 2,831,109. Shipments to Denmark, 4,099,403 pounds, were practically the same as in 1920, 3,951,166 pounds, as were also those to Germany, 3,200,158 pounds as compared with 2,917,773 in 1920.

In the trade of the two coffee-exporting possessions of the United States, Hawaii and Porto Rico, the 1921 figures show a considerable increase in shipments from Hawaii to continental United States and to foreign countries, while exports from Porto Rico fell off slightly.

Hawaii in 1921 sent 803,905 pounds valued at $123,347 to foreign countries, which compared with 687,597 pounds valued at $200,180 in the year before, and 4,183,046 valued at $650,036 to continental United States, as against 1,885,703 pounds valued at $476,033 in the previous year.

Porto Rico's crop, as usual, furnished the bulk of the domestic exports of the United States to foreign countries--29,546,348 pounds valued at $5,027,741, as against 1920 exports of 31,321,415 pounds valued at $8,455,908. Shipments from Porto Rico to continental United States amounted to 211,531 pounds valued at $35,780, as against 418,127 pounds valued at $118,663 in 1920.

Following are the figures of re-exports of coffee by countries in the calendar year 1921:

RE-EXPORTS OF COFFEE FROM UNITED STATES, 1921

Country Pounds Belgium 2,717,949 Denmark 4,099,403 France 11,429,952 Germany 3,200,158 Greece 539,933 Netherlands 920,855 Norway 237,155 Sweden 1,935,641 Canada 1,037,628 Mexico 3,236,245 Cuba 2,831,109 Other Countries 4,618,656 ---------- Total 36,804,684

Per capita consumption of coffee in continental United States showed a slight increase during the calendar year 1921 over that of 1920, the figure being 12.09 pounds as against 11.70 for the previous year. This calendar-year figure compares with the fiscal-year figure of 12.21 pounds, indicating that imports during the last half of 1920 were somewhat heavier than during the last half of 1921.

The various items for the two calendar years 1920 and 1921 are shown as follows:

1921 1920 Calendar year, Calendar year, (pounds) (pounds) (a) Total imports into U.S. 1,340,979,776 1,297,439,310 (b) Imports into non-contiguous territory from foreign countries 7,410 27 ------------- ------------- (c) (a) minus (b) 1,340,972,366 1,297,439,283 (d) Total exports from U.S. 34,572,967 36,757,443 (e) Exports from non-contiguous territory to foreign countries 30,363,098 32,028,832 ---------- ---------- (f) (d) minus (e) 4,209,869 4,728,611 (g) Total re-exports from U.S. 36,804,684 49,144,691 (h) Re-exports from non-contiguous territory to foreign countries ... 20,008 --------- ---------- (i) (g) minus (h) 36,804,684 49,124,683 (j) Imports into continental U.S. from non-contiguous territory 4,394,577 2,303,830 (k) Exports to non-contiguous territory from continental U.S. 798,644 972,303 ---------- --------- (l) (j) minus (k) 3,595,933 1,331,527 Net consumption, continental U.S.: (c) minus (f) minus (i) plus (l) 1,303,553,746 1,244,917,516 Population, July 1 107,833,279 106,418,170 Per capita consumption, 1921 12.09 11.70

XXIII. HOW GREEN COFFEES ARE BOUGHT AND SOLD

Buying coffee in the producing countries--Transporting coffee to the consuming markets--Some record coffee cargoes shipped to the United States--Transport over seas--Java coffee "ex-sailing vessels"--Handling coffee at New York, New Orleans, and San Francisco--The coffee exchanges of Europe and the United States--Commission men and brokers--Trade and exchange contracts for delivery--Important rulings affecting coffee trading--Some well known green coffee marks

In moving green coffee from the plantations to the consuming countries, the shipments pass through much the same trade channels as other foreign-grown food products. In general, the coffee goes from planter to trader in the shipping ports; thence to the exporter, who sells it to an importer in the consuming country; he in turn passing it on, to a roaster, to be prepared for consumption. The system varies in some respects in the different countries, according to the development of economic and transportation methods; but, broadly considered, this is the general method.

Buying Coffee in the Producing Countries

The marketing of coffee begins when the berries are swept up from the drying patios, put in gunny sacks, and sent to the ports of export to be sampled and shipped. In Brazil, four-wheeled wagons drawn by six mules, or two-wheeled carts carry it to the nearest railroad or river.

Brazil, as the world's largest producer of coffee, has the most highly developed buying system. Coffee cultivation has been the chief agricultural pursuit in that country for many years; and large amounts of government and private capital have been invested in growing, transportation, storage, and ship-loading facilities, particularly in the state of Sao Paulo.

The usual method in Brazil is for the fazendeiro (coffee-grower) or the commisario (commission merchant) to load his shipments of coffee at an interior railroad station. If his consignee is in Santos, he generally deposits the bill of lading with a bank and draws a draft, usually payable after thirty days, against the consignee. When the consignee accepts the draft, he receives the bill of lading, and is then permitted to put the coffee in a warehouse.

Storing at Santos

At Santos most of the storing is done in the steel warehouses of the City Dock Company, a private corporation whose warehouses extend for three miles along the waterfront at one end of the town. Railroad switches lead to these warehouses, so that the coffee is brought to storage in the same cars in which it was originally loaded up-country. The warehouses are leased by commisarios. There are also many old warehouses, built of wood, still operated in Santos, and to these the coffee is transferred from the railroad station either by mule carts or by automobile trucks.

At the receiving warehouses, samples of each bag are taken; the tester, or sampler, standing at the door with a sharp tool, resembling a cheese-tester, which he thrusts into the center of the bag as the men pass him with the bags of coffee on their heads, removing a double handful of the contents. The samples are divided into two parts; one for the seller, and one that the commisario retains until he has sold the consignment of coffee covered by that particular lot of samples.

The Disappearing Ensaccador

In the old days it was the custom every morning for the ensaccadores, or baggers, and the exporters or their brokers, to visit the commisarios' warehouses and to bargain for lots of coffee made up by the commisario.

In the Santos market, until recent years, the ensaccador, or coffee-bagger, often stood between the commisario and exporter. When American importing houses began to establish their own buying offices in the Brazilian ports (about 1910) to deal direct with the fazendeiro and the commisario, the gradual elimination of the ensaccador was begun. Today he has entirely disappeared from the Santos market, and is disappearing from Rio de Janeiro, Bahia, and Victoria.

Coffee reaches Santos in a mixed condition; that is, it has not been graded, or separated according to its various qualities. This is the work of the commisario, who puts each shipment into "lots" in new "official" bags, each of which bears a mark stating that the contents are Sao Paulo growth. If the coffee is offered for sale by the owner, the commisario will then put it on the "street," the section of Santos given over to coffee trading.

The commisario works with samples of the coffee he has to offer and only puts out one set at a time. He names his "asking" price, known locally as the pedido, which is the maximum rate he expects to get, but seldom receives. A set of samples may be shown to twenty-five or thirty exporting houses in a day, one at a time. When the sample is in the hands of a firm for consideration, no other exporter has the right to buy the lot even at the pedido price, and the commisario can not accept other offers until he has refused the bid. On the other hand, if a house refuses to give up the samples, it is understood that it is willing to pay the pedido price. The firm first offering a price acceptable to the commisario's broker gets the lot, even though other houses have offered the same price.

When a lot is sold, the samples are turned over to the successful bidder, and he then asks the commisario for larger samples for comparison with the first set.

Commisarios Make as High as Nine Percent

Having sold the coffee of a given planter, the commisario often gets as much as nine percent for his share of the transaction. Unless the bags have been furnished to the planter at a good rental, the coffee must be transferred to the commisario's bags; and for this the planter pays a commission.

Formerly the coffee, being rebagged by the ensaccador, was manipulated in what is called ligas; that is, mixing several neutral grades from various lots to create an artificial grade; or, more properly speaking, a "type," desirable for trading on the New York market.

Grading and Testing in Brazil

Having bought a lot of coffee, the exporter's next step is to grade and to test it. Grading is generally done in the morning and late afternoon, the hours from one to half-past four being devoted to making offers. The afternoon grading is done by sight. The morning examinations are more thorough, some progressive exporting houses even cup-testing the samples. Samples are compared with house standards, and with the requirements that have been cabled from the home office in the consuming country. Some of the coffee is roasted to obtain a standard by which all "chops" (varieties) are then graded and marked according to quality--fine, good, fair, or poor. Quality is further classified by the numerals from two to eight, which standards have been established on the New York Coffee and Sugar Exchange, and are described farther on in this chapter. Some traders also use the terms large or small bean; fair, good, or poor roasters; soft or hard bean; light or dark; and similar descriptive terms.

When a lot is ready for shipment overseas, the commisario stamps each bag with his identifying mark, to which the buyer or exporter adds his brand. If the commisario is ordered before eleven in the morning to ship a lot of coffee, he must be paid before three in the afternoon of the same day; if he receives the order after eleven, payment need not be made before three in the afternoon of the following day. Generally the terms of sale are full settlement in thirty days, less discount at the rate of six percent per annum for the unexpired time, if paid before the period of grace is up.

Dispatching and Capitazias

The exporter collects his money by drawing a draft against his client on deposit of bill of lading, cashing the draft through an exchange broker who deducts his brokerage fee. The exporter must obtain a consular invoice, a shipping permit from both federal and state authorities, and pay an export tax, before the coffee goes aboard the ship. This process is known as "dispatching," while the dock company's charges are known as capitazias.

In practically all coffee-growing sections the small planter is helped financially by the owners of processing plants or by the exporting firms. The larger planters may even obtain advances on their crops from the importing houses in New York, Havre, Hamburg, or other foreign centers.

The Exchange at Santos

A new coffee exchange began business at Santos on May 1, 1917, sitting with the Coffee Brokers Board of Control. This Board consists of five coffee brokers, four elected annually at a general meeting of the brokers of Santos, and one chosen annually by the president of the state of Sao Paulo. Among the duties of the Board are the classification and valuation of coffee, adjustment of differences, etc.

Transporting Coffee to Points of Export

Transportation methods from plantation to shipside naturally vary with local topographical and economic conditions. In Venezuela, the bulk of the coffee is transported by pack-mule from the plantations and shipping towns to the head of the railroad system, and thence by rail to the Catatumbo River, where it is carried in small steamers down the river and across Lake Maracaibo to the city of Maracaibo. In Colombia, coffee is sent down the Magdalena River aboard small steamers direct to the seaboard. In Central America, transportation is one of the most serious problems facing the grower. The roads are poor, and in the rainy season are sometimes deep with mud; so much so that it may require a week to drive a wagon-load of coffee to the railroad or the river shipping point.

Buying Coffee in Abyssinia

Coffee is generally grown in Abyssinia by small farmers, who mostly finance themselves and sell the crop to native brokers, who in turn sell it to representatives of foreign houses in the larger trading centers. Trading methods between farmer and broker are not much more than the old system of barter. In the southwestern section, where the Abyssinian coffee grows wild, transport to the nearest trading center is by mule train, and not infrequently by camel back. In the Harar district, the women of the farmers living near Harar the market center, carry the coffee in long shallow baskets on their heads to the native brokers. In the more remote places the coffee farmer waits for the broker to call on him. From the town of Harar the coffee is transported by mule or camel train to Dire-Daoua, whence it is shipped by rail to Jibuti, to be sent by direct steamers to Europe, or across the Gulf of Aden to Aden in Arabia.

Ten different languages are spoken in Harar. In order successfully to engage in the coffee business there, it is necessary either to become proficient in all these tongues, or to engage some one who is.

When the coffee is brought, partially cleaned, into Harar by donkey or mule train, it is first taken to the open air custom-house (coffee exchange) in the center of the town, where a ten-percent duty (in coffee) is exacted by the local government, and one Abyssinian dollar (fifty cents) is added for every thirty-seven and a half pounds, this latter being Ras Makonnen's share. As soon as the native dealer has released to him what remains of his shipment, he takes it out of the custom-house enclosure and disposes of it through the native brokers, who have their little "office" booths stretching in a long line up the street just outside the custom-house entrance.

There, a brokerage charge of one piaster per bag is paid by the buyer, and the coffee then becomes the property of the European merchant. In some cases it is put through a further cleaning process; but usually it is shipped to Jibuti or Aden uncleaned. Arriving at Jibuti, there is a one-percent ad valorem duty to pay. At Aden, there is another tax of one anna (two cents) to be paid to the British authorities.

Since 1914, however, Abyssinian coffee has been exported largely through the Sudan, a much shorter and less expensive trip than that to Adis Abeba and Jibuti. Now the coffee is carried by pack-train to Gambela on the Sobat River; and thence by river steamer to Khartoum, where it is loaded on railroad trains and sent to Port Sudan on the Red Sea.

Buying Coffee in Arabia

Most of the coffee in Arabia is grown in almost inaccessible mountain valleys by native Arabs, and is transported by camel caravan to Aden or Hodeida, where it is sold to agents of foreign importing houses. Mocha, once the principal exporting city for coffee, was abandoned as a coffee port early in the nineteenth century, chiefly because of the difficulty of keeping the roadstead of the harbor free from sandbars.

In Aden there is a kind of open-air coffee "exchange" (as in Harar) where the camel trains unload their coffee from the interior. The European coffee merchant does not frequent it, but is represented by native brokers, through whom all coffee business is transacted. This native broker is an important person, and one of the most picturesque characters in Aden. He receives a commission of one and a half percent from both buyer and seller. Certain grades of coffee are purchasable only in Maria Theresa dollars; so a knowledge of exchange values is essential to the broker's calling.

In making coffee sales, the negotiations between buyer and seller are carried on by means of finger taps under a handkerchief. The would-be purchaser reaches out his hand to the seller under cover of the cloth and makes his bid in the palm of the seller's hand by tapping his fingers. The code is well understood by both. Its advantage lies in the fact that a possible purchaser is enabled to make his bid in the presence of other buyers without the latter knowing what he is offering.

Buying Coffee in Netherlands India

In the Dutch East Indies cultivation of Coffea arabica has diminished, the decay of the industry beginning when Brazil and Central America became the dominant factors in the green market. Not so many years ago coffee growing and coffee trading were virtually government monopolies. Under government control each native family was required to keep from six hundred to a thousand coffee trees in bearing, and to sell two-fifths of the crop to the government. It was also compulsory to deliver the coffee cleaned and sorted to the official godowns, and to sell the crop at fixed prices--nine to twelve florins per picul previous to 1874, although forty to fifty florins were offered in the open market. Later, the price was advanced; until about 1900 the government paid fifteen florins per picul for coffee in parchment. All government coffee was sold at public auction in Batavia and Padang, these sales being held four times a year in Batavia and three times a year in Padang.

Coffee from private estates, not under government control and operated by European corporations or individuals, has now succeeded the government monopoly coffee. Private-estate crops are sold by public tender, usually on or about January 28 of each year. If the owners do not get the price they desire in Batavia or Padang, the coffee is sent to Amsterdam for disposal. Some coffees always are sent to Holland; because the directors of the company get a commission on all sales there, and also because the coffees are prepared especially for the Dutch market. The Hollander wants his coffee blue-green in color.

Loading Coffee at Santos

In Brazil, when the coffee has been rebagged and marked by both the commisario and the exporter, the coffee is again sampled. These samples are compared with those by which the purchase was made; and if right, the bags are turned over to the dock-master, who sets his laborers to work loading ship. Two methods are used at Santos. The old familiar style of hand labor is still in evidence--men of all nationalities, but largely Spaniards and Portuguese, take the bags on their heads and carry them in single file up the gangplanks and into the hold of the ship. The dock company, however, operates a huge automatic loading machine, or belt, which saves a great deal of time and labor. In other Brazilian ports all loading is done by manual labor.

Recently, at the suggestion of the Commercial Association of Santos, the minister of transport of Sao Paulo ordered that coffees destined for legitimate traders should be transported during four days of the week, and those of a speculative nature during the remaining two days. A premium of as much as five milreis a bag has been paid by speculators in order to obtain immediate transport.

Shipping Coffee from Colombia

As Colombia ranks next to Brazil in coffee, a brief description of its transportation methods, which are unique, should be of interest to coffee shippers. A goodly portion of Colombia's coffee exports comes from the district around the little city of Cucuta, whose official name is San Jose de Cucuta. It is the capital of North Santander, is situated in a beautiful valley of the Colombian Andes mountains that is watered by several rivers, and is only about a half-hour's ride by motor from the Venezuelan frontier.

Due to its geographical position, Cucuta serves as the most convenient inland port and commercial center for most of the department of North Santander. For the same reason, it is forced to depend on Maracaibo as its seaport, even though the Venezuelan government has a number of annoying laws controlling the commerce thus conducted. The Colombian ports of Baranquilla and Cartagena on the Atlantic are too distant from Cucuta to be available; and a large part of the traffic would have to be done on mule-back across one of the most formidable ranges of the Colombian Andes, involving high cost and delay in transportation. Yet its frontier position makes it possible for Cucuta to have important commercial relations with the neighboring republic of Venezuela, and to enjoy exceptional privileges from the Colombian central government.

A cargo of coffee leaving Cucuta has to go through the following steps on its way to a foreign market:

1. From Cucuta, it travels thirty-five miles by railroad to Puerto Villamizar, a Colombian river port on the Zulia river.

2. At Puerto Villamizar it is loaded into small, flat-bottomed, steel lighters that are taken to Puerto Encontrados by man power. Puerto Encontrados, belonging to Venezuela, is on the Catatumbo river; and the trip from Villamizar takes from two to four days, depending on the depth of water in the river. During high water, river steamers are also used, and make the trip in less than a day.

3. At Encontrados the cargo is loaded on river steamboats more or less of the Mississippi river type, which take it to Maracaibo, Venezuela. Coffee is also carried to Maracaibo by small sailing vessels.

4. At Maracaibo it is taken by ocean vessel, which either carries it direct to New York or to Curacao, Dutch West Indies, where it is transhipped to steamers plying between New York and Curacao. It is obvious that the many transhipments that coffee coming from Cucuta has to undergo greatly retard its arrival at a foreign port; and a cargo sometimes takes a month or more to reach New York.

Coffee from Cucuta is stored in the Venezuelan custom-house, from which it must be shipped for export within forty-five days, or the shipper runs the risk of having it declared by the Venezuelan government for consumo (home consumption) at a prohibitory tariff. Arrangements can be made at considerable cost to have the coffee taken to a private warehouse; but it is no longer possible to make up the chops in Maracaibo, as was done formerly with all the Cucutas. The Venezuelan customs will not even allow the Maracaibo forwarding agent the same chops, as a general rule. Special permission must be obtained to change any bags that are stained or damaged. Schooners from Curacao have, in the past, carried a great deal of the Colombian coffee to Curacao.

Port Handling Charges in Brazil

It is almost impossible to list all the various charges for the handling of coffee at the port of shipment in Brazil, the figures not being accessible to outsiders. Some figures, such as warehouse charges and various forms of tax, are obtainable, however. For every bag of coffee which is in warehouse over forty-eight hours from the time of its arrival from the railroad there is a charge of two hundred reis (about five cents). In Sao Paulo there is an export tax of nine percent ad valorem levied by the state, and in Rio the state tax is eight and a half percent. Then there is a surtax of five francs per bag in Santos, and of three francs in Rio, which goes toward defraying the expenses of valorization. For every bag of coffee that passes over the dock the dock company charges one hundred reis (about two and a half cents).

Some Record Coffee Cargoes

With its superior loading and shipping facilities Brazil has been able to send extraordinarily large cargoes of coffee to the United States since the development of large modern freight-carrying steamships. While 75,000 or 90,000 bag cargoes were of common occurrence just prior to the outbreak of the World War, several shipments of more than 100,000 bags were made in the years 1915, 1916, and 1917. Up to January, 1919, the record was held by the steamship Bjornstjerne Bjornson which unloaded 136,424 bags at New York on November 17, 1915. Other shipments of more than 100,000 bags were by the Rossetti (December, 1900), 125,918 bags; the Wascana (March 3, 1915), 108,781 bags; the Wagama (October, 1916), 105,650 bags; the American (October 23, 1916), 124,212 bags; the Santa Cecilia (November 2, 1916), 105,500 bags, and the Dakotan (January 6, 1917), which carried 136,387 bags.

Transport Overseas

To bring green coffee to the consuming markets, both steamships and sailing vessels are used, although the latter have almost wholly given way to the speedier and more capacious modern steamers. Because of its large consumption, a constant stream of vessels is always on the way to the markets of the United States. The majority of these unload at New York, which in 1920 received about fifty-nine percent of all the coffee imported into this country. New Orleans came next, with about twenty-five percent; and San Francisco third, with about twelve percent.

The approximate time consumed in transporting green coffee overseas from the principal producing countries to the United States by freight steamships is shown in the table in the next column.

In some cases, that of Guadeloupe, for instance, the vessels stop at a number of ports, and this lengthens the time. This is also true of vessels running on the west coast of Central America and of those from Aden.

During the World War, one shipment of Timor coffee consumed three and a half years coming from Java to New York. It was aboard the German steamship Brisbane, which cleared from Batavia, July 4, 1914, and fearing capture, took refuge in Goa, Portuguese India, where it lay until Portugal joined the Allies. Then the Portuguese seized the vessel, and turned it over to the British, who moved it to Bombay. Here the cargo was finally transhipped to the City of Adelaide, reaching New York in January, 1918, three and a half years after the coffee left Batavia.

TRANSPORTATION TIME FOR COFFEE[J]

Rio de Janeiro to New York 11 to 16 days Santos " " " 14 to 18 " Bahia " " " 17 " Victoria " " " 19 " Maracaibo " " " 10 " Puerto Cabello " " " 10 " La Guaira " " " 8 " Costa Rica " " " 10 " Salvador " " " 18 " Mexico " " " 9 " Guatemala " " " 11 " (Puerto Barrios) Colombia " " " 10 " Haiti " " " 7 " Porto Rico " " " 5 " Guadeloupe " " " 10 " Hawaii " " " 28 " (via P.C.) Java " " " 30 " (via Suez) Sumatra " " " 30 " (via Suez) Singapore " " " 35 " (via Suez) India " " " 35 " (via Suez) Aden " " " 45 " (via Suez) Porto Rico " New Orleans 7 " Guadeloupe " " " 10 " Haiti " " " 7 " Guatemala " " " 8 " Costa Rica " " " 7 " Colombia " " " 6 " Mexico " " " 4 " Salvador " " " 15 " Guatemala " San Francisco 10 " Costa Rica " " " 18 " Salvador " " " 14 " Mexico " " " 8 " Hawaii " " " 8 " Singapore " " " 30 " India " " " 33 "

[J] The American Legion and the Southern Cross, of the Munson Line, make the journey from Rio de Janeiro to New York in eleven days. These are freight-and-passenger vessels, and have carried as many as 5,000 bags of coffee at one time.

Java Coffee "Ex-Sailing Ships"

Up to 1915 it was the custom to ship considerable Java coffee to New York in slow-going sailing vessels of the type in favor a hundred years ago. Java coffees "ex-sailing ships" always commanded a premium because of the natural sweating they experienced in transit. Attempts to imitate this natural sweating process by steam-heating the coffees that reached New York by the faster-going steamship lines, and interference therewith by the pure-food authorities, caused a falling off in the demand for "light," "brown," or "extra brown" Dutch East Indian growths; and gradually the picturesque sailing vessels were seen no more in New York harbor. At the end they were mostly Norwegian barks of the type of the Gaa Paa.

It usually took from four to five months to make the trip from Padang or Batavia to New York. Crossing the Equator twice, first in the Indian Ocean, then in the South Atlantic, the trip was more than equal to circumnavigating the earth in our latitude. In the hold of the vessel the cargo underwent a sweating that gave to the coffee a rare shade of color and that, in the opinion of coffee experts, greatly enhanced its flavor and body. The captain always received a handsome gratuity if the coffee turned "extra brown."

The demand for sweated, or brown, Javas probably had its origin in the good old days when the American housewife bought her coffee green and roasted it herself in a skillet over a quick fire. Coffee slightly brown was looked upon with favor; for every good housewife in those days knew that green coffee changed its color in aging, and that of course aged coffee was best.

And so it came about that Java coffees were preferably shipped in slow-going Dutch sailing vessels, because it was desirable to have a long voyage under the hot tropical sun suitably to sweat the coffee on its way to market and to have it a handsome brown on arrival. The sweating frequently produced a musty flavor which, if not too pronounced, was highly prized by experts. When the ship left Padang or Batavia the hatches were battened down, not to be opened again until New York harbor was reached.

Many of the old-style Dutch sailing vessels were built somewhat after the pattern of the Goed Vrouw, which Irving tells us was a hundred feet long, a hundred feet wide, and a hundred feet high. Sometimes she sailed forward, sometimes backward, and sometimes sideways. After dark, the lights were put out, all sail was taken in, and all hands turned in for the night.

The last of the coffee-carrying sailing vessels to reach the United States was the bark Padang, which arrived in New York on Christmas day, 1914.

Handling Coffee at New York

The handling of the cargoes of coffee when they arrive at their destination is a source of wonder to the layman. There is probably no better place to study the handling of coffee than in New York City--the world's largest coffee center. Millions of bags of coffee pass into consumption every year through its docks, and scarcely a day goes by when there are not one or more ships discharging coffee upon the docks lining the Brooklyn shore, the center of the coffee-warehouse district for New York. In 1921, the New York Dock Company alone had 159 bonded warehouses with a storage capacity of some 65,000,000 cubic feet; and 34 piers, the longest measuring 1,193 feet and containing more than 175,000 square feet. These piers have a total deck space of sixty-one and a half acres. The wharfage distance is more than nine and a third miles. More than twenty steamship lines berth their vessels there regularly, and many of them are coffee ships. The warehouses have direct connections with all the principal railway trunk lines running into the New York district; and the whole property of the company stretches along the waterfront opposite lower Manhattan for about two and one-half miles.

Although coffee is admitted to the United States free of duty, it is subject to practically the same formalities as dutiable goods. Before the cargo can be "broken out," a government permit to "land and deliver" must be placed in the hands of the customs inspector on the dock. This done, the ship's samples, which consist of the samples sent by the exporter to the importer, are taken to the United States appraiser's office for inspection, and are then delivered to the importer's representative. Meanwhile the shipping documents covering the cargo, including bills of lading and consular invoices, have been sent to the post office for delivery to banks and bankers' agents, who check and deliver them to the customs officers for entry. The government requires that this entry shall be made within forty-eight hours of the vessel's arrival, else the cargo will be stored in a United States bonded warehouse under what is known as "general order" which makes the consignee liable for storage and cartage charges.

When a coffee ship arrives in New York, not much time is lost in discharging the cargo. As soon as the vessel is securely moored to the pier, and the government's permission to "land and deliver" is secured, the hatches are removed, the coffee is hauled out of the hold by block and tackle and swung off in slings to the pier, where dock laborers carry the bags to their proper places. If each cargo consisted of one consignment to a single importer, and contained only one variety of coffee, unloading would be a comparatively simple affair. In general practise, however, the cargoes consist of a large number of consignments and a variety of grades, necessitating a careful sorting as unloading progresses. Accordingly, even before the unloading begins, the dock is chalked off into squares, each square having a number, or symbol, representing a particular consignment. As the bags come up out of the hold, the foreman of the laborers, who has a key to the brand marks on the bags, indicates where each bag is to be placed. Coffee to be reshipped, either by lighter or rail, is heaped in piles by itself until loaded on to the lighters or freight cars.

The next step is to transfer the cargo to the warehouse, and to separate each consignment according to the various kinds of coffee making up the invoices. When the importer gives his orders to store, he sends also a list of the different kinds of coffees in his consignment, called "chops" by the trade, with directions how to divide the shipment. To do this, the floor of the warehouse is chalked off into squares, as was done on the dock; but now the numbers, or symbols, in each space indicate the chops in each invoice, or consignment.

The importer naturally is eager to sample the newly arrived coffee. Sampling is generally done by trained warehouse employees, who are equipped with coffee triers, sampling instruments resembling apple-corers, which they thrust into the bags. The instrument is hollow, and the coffee flows into the hand of the sampler, who places each sample in a paper bag which is marked to indicate the chop. The total sample of each chop usually consists of about ten pounds of coffee, which the importer compares with the exporter's sample.

When sampling for trade delivery, about two-thirds of the bags in a chop are tried. But when sampling for delivery on Coffee Exchange contract, every bag must be tested, and care taken that each chop is uniform in color, kind, and quality. Coffee for Exchange delivery must be stored in a warehouse licensed by the Exchange; and the warehouseman is responsible for the uniformity of grade of each chop.

When approximately ninety percent of the cargo has been unloaded and stored, the warehouse issues what has become known as the "last bag notice." In the majority of cases the coffee has been sold before arrival; and on receipt of the last bag notice, the importer can transfer ownership of the coffee and save interest.

In a cargo of 75,000 to 100,000 bags of coffee that have been hurriedly loaded in the producing country and unloaded at destination in equal haste, a small portion of the cargo is almost certain to be damaged. Generally the damage is slight. If a bag is torn or stained, the coffee is placed in a new bag. If the contents have become mildewed, the damaged portion is taken to a warehouse for reconditioning; while the sound coffee is thoroughly aired to remove the odor and is then placed in a clean bag. The reconditioned lot is put into a separate package and forwarded to the buyer with a "reconditioning statement" that shows what has been done.

Bags that have become torn in transit, and parts of their contents spilled, are called "slacks." These are weighed as they arrive on the dock by a licensed public weigher; and a sufficient quantity of the coffee remaining on the floor of the ship's hold is put into the bag to make it of the proper weight. The expense of reconditioning and rebagging is generally borne by the marine insurance companies. When the entire cargo is unloaded, and the slacks and bad-order bags are weighed and marked, the warehouseman tallies up the records of his clerks, and renders a corrected chop list to the consignee.

Electric Tractors and Trailers

Another district along the water front of Brooklyn where coffee is discharged in large quantities is that between Thirty-third and Forty-fourth Streets, south Brooklyn, occupied by the Bush Terminal Stores. This plant is laid out with railroad spurs on every pier, so that its own transfer cars, or the cars of the railroads running out of New York, can be run into the sheds of the docks where coffee is being discharged from the ships. The methods employed by the Bush Terminal are similar to those just described, except that all the coffee is handled by electrically-manipulated cars or trucks, in some instances the powerful little tractors hauling many "trailers" to various parts of the yards.

Handling Charges at New York

Before the World War, it cost approximately one-half cent a bag to handle green coffee from the vessel to warehouse and in storage in New York. The rate advanced nearly one hundred percent in the latter part of 1919, then dropped slightly, although it is still (1922) above the pre-war price. Other handling charges are shown in the following tabulation:

COFFEE HANDLING CHARGES AT NEW YORK

Pre-war prices Present prices Cents per bag Cents per bag (132 lbs.) (132 lbs.) Storage 3 to 4 5 to 8 Labor 3 to 4 5 to 8 Sampling for damage 1 1 Cleaning 35 20 Dumping and mixing 10 15 Dumping and airing 10 15 Shoveling and airing 10 15 Transferring coffee from floor to floor 4 8 Marking 1 1 Labor at vessel $9 per M $12.50 to $15 per M

The warehousemen in 1919 charged four cents per bag for loading into railroad cars. This charge was discontinued in 1921. The cost of weighing increased from two and one-half cents per bag in 1914 to four and one-half cents in 1919, and then dropped to the present price of three to three and one-half cents. Other handling charges at the port of New York are:

OTHER HANDLING CHARGES, 1922 Cents per bag (132 lbs.) Drawing samples, each 10 lbs 17 to 20 Grading for variation 4 Matching in 12 Reducing or evening off slack 9 Transferring to new bag 10 Trucking to weigher in store 3 Collecting and preparing sweepings 25 Delivering sample below Canal Street 75 Each additional sample 10 to 15 New bags 15 Old bags 6

A plan intended to cut down handling costs in New York, and to expedite deliveries, was inaugurated by the National Coffee Roasters Association at the beginning of 1920. The Association formed a freight-forwarding bureau, and invited members to have their coffee shipments handled through the bureau. The charges for forwarding direct importations are two cents per bag. Cartage charges vary from six to eighteen cents per hundred pounds. Claims are handled without charge.

The Seven Stages of Transportation

The foregoing story has taken the reader through the seven most direct routes that lead from the plantation to the roaster: first, from the patio to the railroad or river; then to the city of export; into the warehouses there; then into the steamers; out of them, and upon the wharf at the port of destination; from the wharf into the warehouses; and, finally, from the warehouses to the roasting rooms. It will be understood that in some instances where the plantation is hidden away in the mountains, it is necessary to relay the coffee; and again, at this end, the coffee is very often transhipped. In such cases, more handlings are required.

Handling Coffee at New Orleans

Coffee ships are unloaded in New Orleans, the second coffee port in the United States, in about the same general manner as in New York, with the important exception that the block-and-tackle system for transferring the bags from the ship to the dock has been largely supplanted by the automatic traveling-belt conveyor system. Another notable feature is New Orleans' steel-roofed piers, whereon the coffee can be stored until ready for shipment to the interior. Because of the class of labor--mostly negro--employed in unloading ships, New Orleans has found it expedient to retain the old flag system to indicate the part of the pier where each mark of coffee is to be piled as taken from the vessel. These little flags vary in shape, color and printed pattern, each representing a particular lot of coffee, and they are firmly fixed at the part of the pier where those bags should be stacked. Trained checkers read the marks on the bags as the laborers carry them past, and tell the carrier where the bag should be placed. To the illiterate laborers the checker's cries of "blue check," "green ball," "red heart," "black hand," and the like, are more understandable than such indications as letters or numbers.

Handling Coffee at San Francisco

San Francisco ranks third in the list of United States coffee ports, having received its greatest development in the four years of the World War, when the flow of Central American coffees was largely diverted from Hamburg to the Californian port. In the course of these four years, the annual volume of coffee imports increased from some 380,000 bags to more than 1,000,000 bags in 1918. The bulk of these importations came from Central America, though some came from Hawaii, India, and Brazil and other South American countries. Because of its improved unloading and distributing facilities, San Francisco claims to be able to handle a cargo of coffee more rapidly than either New York or New Orleans.

Handling Central American coffees in San Francisco is distinctly different from the business in Brazil. In order to secure the Central American planter's crops, the importers find it necessary to finance his operations to a large extent. Consequently, the Central American trade is not a simple matter of buying and selling, but an intricate financial operation on the part of the San Francisco importers. Practically all the coffee coming in is either on consignment, or is already sold to established coffee-importing houses. Brokers do not deal direct with the exporters; and practically none of the roasters now import direct.

In recent years San Francisco has adopted the practise of buying a large part of her coffee on the "to arrive" basis; that is the purchase has been made before the coffee is shipped from the producing country, or while in transit. This practise applies, of course, only to well known marks and standard grades. Coffee that has not been sold before arrival in San Francisco is generally sampled on the docks during unloading, although this is sometimes postponed until the consignment is in the warehouse. It is then graded and priced, and is offered for sale by samples through brokers.

San Francisco is better equipped with modern unloading machinery and other apparatus than either New Orleans or New York, even more liberal use being made there than in New Orleans of the automatic-belt conveyors both for transferring the bags from the ships to the docks and for stacking them in high tiers on the pier. Another notable feature of the modern coffee docks is that the newer ones are of steel and concrete and, as in New Orleans, are covered to protect the coffee from wind and storm.

Europe's Great Coffee Markets

Europe has three great coffee-trading markets--Havre, Hamburg, and Antwerp. Rotterdam and Amsterdam are also important coffee centers, but rank far below the others named. In point of volume of stocks, Havre led the world before the war; while in respect to commercial transactions, it ranked second, with New York first. In pre-war days, the largest part of the world's visible supply of coffee was stored in the Havre bonded warehouses, being available for shipment to any part of Europe on short notice, or even to the United States in emergencies. Even during the World War, this French port remained a powerful factor in international coffee trading. Coffee trading in Havre, both exchange and "spot" transactions, follows about the same general lines as in New York and the other great coffee markets. Coffee "futures" are dealt in on the Havre Bourse.

Green coffee is sold in London by auction in Mincing Lane. On arrival, it is stored in bonded warehouses, and is released for domestic use only when customs duty at the rate of four and one-half pence per pound has been paid. The bulk of the coffee comes in parchment on consignment; and before sale, it must be hulled and sorted in the milling establishments, most of which are on the banks of the Thames.

The auctions are held four times a week, usually on Tuesday, Wednesday, Thursday, and Friday. The sales are advertised in the market papers--chief among which is the Public Ledger--and also by the auctioneers, who issue catalogs of their offerings. A few hours before the beginning of the sale, samples are laid out for inspection by prospective buyers, who may cup-test them if they desire. The actual selling is done by competitive cash bidding, the highest bidder becoming the owner. Two classes of brokers do the bidding, one for home trade and the other for exporters.

Home trade takes about a tenth of the coffee, the remainder being sold for export. If the coffee is bought for re-export, it can be transferred to the shipping port, still in bond, and shipped out of the country without paying duty. During the World War, auctions were held about twice a week; but after the signing of the armistice in November 1918, the London traders resumed the four times a week practise.

Coffee Exchanges and Trading Methods

Green-coffee buyers in the large importing centers of the United States and Europe recognize two distinct markets in their operations. One of these is called the "spot" market; because the importers, brokers, jobbers, and roasters trading there deal in actual coffee in warehouses in the consuming country. In New York the spot market is located in the district of lower Wall Street, which includes a block or two each side on Front and Water Streets. Here, coffee importers, coffee roasters, coffee dealers, and coffee brokers conduct their "street" sales.

The other market is designated as the "futures" market; and the trading is not concerned with actual coffee, but with the purchase or sale of contracts for future delivery of coffee that may still be on the trees in the producing country. Futures, or "options" as they are frequently called, are dealt in only on a coffee exchange. The principal exchanges are in New York, Havre, and Hamburg. New Orleans and San Francisco exchange dealers trade on their local boards of trade.

Coffee-exchange contracts are dealt in just like stocks and bonds. They are settled by the payment of the difference, or "margin"; and the option of delivering actual coffee is seldom exercised. Generally, the operations are either in the nature of ordinary speculation on margin or for the legitimate purpose of effecting "hedges" against holdings or short sales of actual coffees.

The New York Coffee and Sugar Exchange--the most important in the world, because of the volume of its business--deals in all coffees from North, South, and Central America, the West Indies and the East Indies (except those of the Robusta variety) and uses Type No. 7 as the basis for all Exchange quotations. All other types are judged in relation to it. In determining the number of a type, the coffee is graded by the number of imperfections contained in it.

These imperfections are black beans, broken beans, shells, immature beans ("quakers"), stones, and pods. For counting the imperfections, the black bean has been taken as the basis unit, and all imperfections, no matter what they may be, are calculated in terms of black beans, according to a scale, which is practically as follows:

BLACK-BEAN SCALE

3 shells equal 1 black bean 5 "quakers" equal 1 " " 5 broken beans equal 1 " " 1 pod equals 1 " " 1 medium size stone equals 1 " " 2 small stones equal 1 " " 1 large stone equals 2 to 3 " "

By this scale a coffee containing no imperfections would be classified as Type No. 1. The test is made on one-pound samples. If a sample shows six black beans, or equivalent imperfections, it is graded as No. 2; if thirteen black beans, as No. 3; if twenty-nine black beans, as No. 4; if sixty black beans, as No. 5; if one hundred and ten black beans, as No. 6, and if more than one hundred and ten black beans, as No. 7 or No. 8. These two are graded by comparison with recognized exchange types. Coffees grading lower than No. 8 are not admissible to this country.

The quotation relationship of other types with the basic Rio No. 7 is shown in the table below.

By this scale one can determine that when Rio No. 7 is quoted at 17.10, Rio No. 2 is 18.60, Santos No. 3, 19.10, and Bogota No. 5, 18.10. The quotations are on the pound and cents basis.

SCALE OF QUOTATION RELATIONSHIP

BRAZILIAN COFFEE-- SANTOS COFFEE OTHER KINDS--NOT NOT SANTOS BRAZILIAN Type Type Type No. 1--180 points above No. 1--260 points above No. 1--300 points above No. 2--150 points above No. 2--230 points above No. 2--250 points above No. 3--120 points above No. 3--200 points above No. 3--200 points above No. 4---90 points above No. 4--150 points above No. 4--150 points above No. 5---60 points above No. 5--100 points above No. 5--100 points above No. 6---30 points above No. 6-- 50 points above No. 6--50 points above No. 7---Basis No. 7--Basis No. 7--Basis No. 8---50 points below No. 8--50 points below No. 8--50 points below

A point is the hundredth part of a cent

In the spot market, a trader may also buy or sell coffee "to arrive"; that is, a consignment that is aboard ship on the way to the market. Coffee is shipped to New York either on a consignment basis and sold for a commission, or it may have been bought in the shipping port and be already the property of an importer. When shipped on consignment, a wholesaler usually buys on the in-store contract, which provides that the purchaser must take delivery at the warehouse, though he is generally given a month's storage privilege before removal of the coffee. The practise among New York importers at present is to buy coffee on either the basis of F.O.B. delivery steamer at loading port, or delivery C. & F. (cost and freight), or C.I.F. (cost, insurance, and freight), port of destination. Payment is made by letter of credit drawn on a New York or London bank, entitling the exporter to draw at ninety days' sight against the shipping documents, so that the shipment will be in the hands of the purchaser long before the draft is made. Frequently a jobber acts as his own importer of Brazil coffee, buying direct from the exporter without utilizing the agency of a broker or a regular importing firm.

Brazil coffee is bought with the stipulation that differences between samples and the coffee actually delivered may be adjusted either on "Brazil grading," "half difference," or "full difference"; and with the further provision that, if the delivery is a full type higher or lower than specified in the contract, the entire shipment may be rejected. Under the "Brazil grading" provision, the buyer must accept delivery if the coffee is better than the next lower type, even though not up to the type ordered; and if the coffee is of a higher type than contracted for, he need not pay premium for it. In buying on the "half difference" or "full difference" basis, the buyer is entitled to payment for half the difference or the full difference, respectively, for any undergrading, or must pay the seller accordingly if there is any overgrading. When a buyer specifies special features of description, in addition to type, some sellers protect themselves against claims for difference on this score by inserting in the contract a clause to the effect that the description is given in good faith, but is not guaranteed by the seller.

How the New York Exchange Functions

When the New York Coffee Exchange was incorporated in 1881, its charter stated its purposes to be "to provide, regulate and maintain a suitable building, room or rooms for the purchase and sales of coffees and other similar grocery articles in the city of New York, to adjust controversies between members, to inculcate and establish just and equitable principles in the trade, to establish and maintain uniformity in its rules, regulations and usages, to adopt standards of classification, to acquire, preserve and disseminate useful and valuable business information, and generally to promote the above mentioned trade in the city of New York, increase its amount, and augment the facilities with which it may be conducted."

In the promotion of trade at New York the Exchange has been highly successful. From time to time it has been criticized; and, more than once, coffee traders in the East and in the West have raised a question as to its value to non-speculating members. There are those who believe it serves a useful purpose, and others who call it a huge pool room. To say that, on the whole, it is not of benefit to the trade would be untrue. As one of its champions pointed out in 1914, when it shut down for a period of four months on account of the World War:

The ability to discount the future is a necessity, and demands the facilities that a unit of centralization like the Exchange affords. There is no difference between a purchase of coffee and one of a future month on options.

The experience gained here and abroad demonstrates that any check placed upon such dealings is detrimental, with far-reaching effects upon the whole body of the trade. Unquestionably the Exchange is a powerful factor as a regulator of extremes in the market.

The experience gained in Germany, where an embargo was placed upon transactions in futures, is illuminating. The disastrous effects were so plain that the authorities were forced to abandon their objections and permit a resumption of the business along the old lines.

But a good thing can be abused, and the opportunity to gamble in options availed of by so many is the increment that disturbs the legitimacy of the market and creates the opposition to the whole proposition. When the Exchange is ready to insist that every transaction in futures must be a legitimate one, and that every trader under its jurisdiction using the facilities of the Exchange is made to realize that any operations that are purely of a gambling nature will subject him to severe discipline, then the Coffee Exchange will begin to stem the tide of an ever-growing opposition by the general public.

The New York State legislative committee on speculations in securities and commodities had the following to say on the Coffee Exchange in its report to Governor Charles E. Hughes in 1909:

It [the Coffee Exchange] was established in order to supply a daily market where coffee could be bought and sold and to fix quotations therefor, in distinction from the former method of alternate glut and scarcity, with wide variations in price--in short, to create stability and certainty in trading in an important article of commerce. This it has accomplished; and it has made New York the most important primary coffee market in the United States. But there has been recently introduced a non-commercial factor known as "valorization," a governmental scheme of Brazil, by which the public treasury has assumed to purchase and hold a certain percentage of the coffee grown there, in order to prevent a decline of the price. This has created abnormal conditions in the coffee trade.

All transactions must be reported by the seller to the superintendent of the Exchange, with an exact statement of the time and terms of delivery. The record shows that the average annual sales in the past five years have been in excess of 16,000,000 bags of 130 pounds each.

Contracts may be transferred or offset by voluntary clearings by groups of members. There is no general clearing system.[319] There is a commendable rule providing that, in case of a "corner," the officials may fix a settlement price for contracts to avoid disastrous failures.

The original initiation fee was $250. Seats on the Exchange once sold for as low as $110. In January, 1916, there was a sale at $3,000; in October, 1916, there was a sale for $5,000; in April, 1921, three seats were sold for $5,500 each; but the record price of $8,600 was paid in 1919. Seats are now (1922) worth about $6,000.

The Exchange includes in its membership 323 brokers, importers, dealers, and roasters. Membership is passed upon by a committee on membership; but any one twenty-one years old, resident or non-resident, of good character and commercial standing, is eligible when proposed and seconded by Exchange members. The committee refers the application with its recommendation to the board of managers, which takes a ballot. The adverse vote of one-third of all votes cast rejects.

The Exchange elects annually a president, a vice-president, and a treasurer, who perform the usual duties of Exchange officers. The real governing body is the board of managers, consisting of the president, vice-president, treasurer, and twelve other members. This governing board, meeting monthly, appoints the necessary subordinate officers and employees, and fixes their compensation, and may "summon before them any officer or member for any purpose whatsoever." It appoints the secretary of the Exchange from among its own number, a superintendent of the Exchange, and the numerous committees which are in active charge of specified activities. It also licenses the necessary coffee graders, warehousemen, weighmasters, and samplers of the Exchange.

A brief discussion of the duties of the superintendent and the various committees will help to explain the methods of the Exchange market. The superintendent, under the direction of the board of managers, has charge of the details of its work and of that of the various committees. He keeps all the books and documents of the Exchange; collects and pays over to the treasurer all moneys due the Exchange not otherwise provided for; receives, deposits, and pays over all margins on coffee contracts; has active charge of the Exchange rooms and the bulletin board; and manages and appoints, with the consent of the board of managers, the assistants needed to perform the details of the work under his charge.

One of the functions of the Exchange is to grade and to classify coffee, in which it takes every possible precaution. The rules provide for eight standard grades; and only licensed graders are permitted to pass upon the product handled on the Exchange. There are twenty-five of these graders; one of whom is appointed as a supervisor of types, to provide fresh standards and to "maintain them as nearly as possible on an equality." When these standards are approved by the board and the Exchange, they remain in force for a year.

When coffee is received at a licensed warehouse, two official graders are chosen, one by the buyer and one by the seller. These graders receive four cents a bag if employed by a member; and eight cents a bag, if employed by a non-member.

If the graders disagree, their differences are referred to the board of coffee arbitrators, consisting of ten experts appointed by the board of managers. The superintendent selects by lot three of these arbitrators, who decide on the basis of the samples submitted, but will not make a decision lowering the grade below that of the lowest submitted nor higher than the highest. If the disputants do not change the grading to come within the arbitrators' findings, the samples are sent to the entire board of arbitrators, exclusive of those who may have been the original graders, and final decision is made by majority vote. As soon as the coffee is graded, a certificate is issued stating the grades, and bearing the signatures of the superintendent and graders. This certificate is conclusive evidence of the grade as far as the parties involved are concerned, for the subsequent twelve months. The buyer receives the original, and the seller a duplicate.

The rules provide that weights decided upon at the initial delivery are good during the life of the grading certificate for re-delivery, with definite allowances to the receiver, on re-delivery, of a quarter of a pound a bag a month, instead of having to re-weigh and re-sample for every separate delivery, as formerly.

As claims and trade controversies occasionally arise, the Exchange has provided means for their peaceful settlement. The board of managers elects annually an arbitration committee of five members, who swear to decide disputes fairly. This is the only committee on the Exchange that has power to adjudicate disputes between members and non-members; and its services must be sought by the disputants, who must agree to abide by its decision. An adjudication committee of seven is annually chosen from the membership by the managers, to adjust all claims and controversies between members arising out of any merchandise transaction, "if notice in writing of such claim or controversy, and of the intention to demand an adjudication thereon, be served by either party thereto within ten days from the ascertainment thereof."

Within three days of the serving of this notice, each disputant selects an Exchange member as his adjudicator; and these two name the third, who must be a member of the adjudicating committee. Even this decision may be appealed to the board of managers, which, if it finds the grounds of appeal good (as decided by majority vote), appoints an appeal committee of five, of whom three must be members of the board. This last committee's decision is final. No new testimony bearing on the case may be introduced after the case has been closed by the adjudicators. Arbitration is voluntary with both parties; while adjudication is compulsory upon the application of either.

Another committee of trade importance is the spot quotation committee of five Exchange members. Each day at two o'clock, except on Saturday, when it meets at 11:45, this committee by a majority vote establishes the official daily market quotation of No. 7 coffee. There is likewise a committee on quotations of futures. This committee of five meets daily "immediately after the first call and at the close of the Exchange and reports to the superintendent the tone and price of the contract market, to be posted on the blackboard and transmitted to other Exchanges and commercial bodies."

A committee of five on trade and statistics has the important function of reporting to the board as to regulations for the "purchase, sale, transportation and custody of merchandise," and it attempts to establish uniformity in such matters between different markets. It has charge also of "all matters pertaining to the supply of newspapers, market reports, telegraphic and statistical information for the use of the Exchange. In the early 80's the Exchange abolished the old method of keeping coffee statistics, and the basis then adopted has since been accepted by all the large coffee markets of the world."

The minimum rates of commission on coffee "per contract of 250 bags, for members of the Exchange residing in the United States, are based upon a price" as follows, quoting from the Exchange bylaws adopted June 8, 1920:

COFFEE EXCHANGE COMMISSION RATES (Per contract of 250 bags)

Floor Commission brokerage for buying for buying or selling or selling Below 10 cents $6.25 $1.50 10 cents up to 19.99 cents 7.50 1.75 20 cents and above 10.00 2.00

For non-members residing within the United States, double the above rates of commission shall be charged.

For members and non-members residing outside of the United States a commission of $2.50 shall be charged in addition to the above rates.

Whenever before thirty minutes after the close of the exchange a member gives to another member for clearance purchases and sales of contracts corresponding in all respects except as to price, made during the day by himself or for his account when present on the floor of the Exchange, a charge for each contract shall be made equal to the corresponding floor brokerage rate for buying and selling, in addition to any floor brokerage incurred.

Members procuring business for other members may, by agreement, be entitled to one-half the commission rates for non-members prescribed in this Section, less the corresponding brokerage charge, whether paid or not.

When a transferable notice is given or received by a customer in fulfillment of a contract the brokerage in that case shall be not less than one-half of the corresponding buying or selling commission prescribed in Section 103.

Other committees are the finance committee (two) to audit bills and claims against the Exchange, to direct deposits and investments, and to audit the monthly and yearly accounts of the treasurer; a law committee (three), to deal with matters of legislation; a membership and floor committee (five); and a nominating committee (five). Organized as above outlined, and with a well established code of trade rules, the Exchange annually transacts a large number of sales in a business-like way.

There is considerable trading in future contracts; and a standard form has been adopted by the Exchange. No future contracts are valid unless they are made in the following form:

BRAZILIAN COFFEE--NOT SANTOS Office of _____________ New York__________ 19__ Sold for M_______________________ To M_______________________

Thirty-two thousand five hundred pounds in about 250 bags coffee, growth of North, South or Central America, West Indies or East Indies, excepting coffee known as "Robusta," and also any coffee of new or unknown growth, deliverable from licensed warehouse in the port of New York, between the first and last days of ________ next, inclusive. The delivery within such time to be at seller's option, upon a notice to buyer of either five, six or seven days, as may be prescribed by the trade rules. The coffee to be of any grade, from No. 8 to No. 1 inclusive (no coffee to grade below No. 8) provided the average grade of Brazilian coffees shall not be above No. 3. Nothing in this contract, however, shall be construed as prohibiting a delivery averaging above No. 3 at the No. 3 grade. At the rate of __________ cents per pound for No. 7, with additions or deductions for other grades according to the rates of the New York Coffee and Sugar Exchange, Inc., existing on the afternoon of the day previous to the date of the notice of delivery. Either party to have the right to call for margins as the variations of the market for like deliveries may warrant, which margins shall be kept good.

This contract is made in view of, and in all respect subject to the rules and conditions established by the New York Coffee and Sugar Exchange, Inc., and in full accordance with section 102 of the bylaws.

_____________________________ Brokers

Across the face is the following:

For and in consideration of one dollar to __________________ in hand paid, receipt whereof is hereby acknowledged, ______________ accept this contract with all its obligations and conditions.

All deliveries on such future contracts must be made from licensed warehouses. There is a separate "to arrive contract"; but this likewise requires delivery at a licensed warehouse, unless the buyer and the seller have a mutual understanding to deliver the coffee from dock or ex-ship. Margins to protect the contract may be called for by either party. The largest deposit for margins was made in 1904, when $22,661,710 was deposited with the superintendent as required by the Exchange rules.

The basic grade in a future sale is No. 7; but variations are provided as follows: 30 points for Rio, Victoria, and Bahia of all grades between 7 and 1, and of 50 points between 7 and 8; 50 points is allowed on Santos and all other coffees except between grades 1 and 2 and 2 and 3 Santos, which are allowed 30 points. Thus the buyer and the seller when entering upon a transaction know exactly what the difference will be between the standard No. 7 and the coffee that can be delivered. The right to deliver any grade in a future transaction has done much to lessen the probability of corners in coffee; but this protection is further given by the stringent rule that the maximum fluctuations on the Exchange can be only two cents a pound on coffee in one day and one cent on sugar. If greater changes should threaten, the Exchange operations would automatically cease.

False or fictitious sales are prohibited, and all contracts must be reported to the superintendent. All contracts are binding and call for actual delivery.

The future contract, besides being used for the delivery of coffee during stated months in the future at a given price, is also used for hedging purposes. As in the grain and cotton markets, dealers protect themselves against price fluctuations by hedging in the future market. Importers, for instance, when purchasing coffee abroad, frequently sell an equal amount for future delivery on the Exchange. When the time for delivery arrives, it is simply a question of calculation of the market conditions whether it is more advantageous to repurchase the sales made as a hedge, or as a kind of insurance to protect themselves against loss, and free the coffee so engaged, or to make delivery of the coffee as it comes in.

The board of managers has power to close the Exchange or to suspend trading on such days or parts of days as would in their judgment be for the Exchange's best interest.

The Clearing Association is a recent outgrowth of the Exchange, and is composed exclusively of Exchange members. Every member has to bring his contracts up to market closing every night, either by making a deposit with the Association to cover his balances, or by withdrawing in case he should be over. Members deposit $15,000 at the time of joining as a guaranty fund; and if the surplus is not sufficient to take care of balances, the bylaws provide for the levying of assessments.

The daily quotations on the coffee exchanges of New York, Havre, and (before the war) of Hamburg, determined to a large extent the price of green coffee the world over. The prices prevailing on the New York Coffee and Sugar Exchange are studied by coffee traders in all countries, the fluctuations being reflected in foreign markets as the reports come from the United States. Quotations are cabled from one great market to another; and as each must heed those of the others to some extent, the coffee trade thus obtains a world price, and the effect on supply and demand is universal rather than local, as would be the case if quotations were not exchanged.

In 1921 the Exchange adopted an amendment to the trade rules, and abolished the one day transferable notice for both coffee and sugar.

Foreign Coffee Quotations

Brazil coffee cable quotations are the market prices, in Rio or Santos, of ten kilograms of coffee, the price being stated in milreis, the monetary unit of Brazil money. The basic grade of coffee at Rio is the No. 7 of the New York Coffee Exchange; and at Santos, the international standard of good average ("g. a.") Santos. One kilogram (often written kilo, or abbreviated to K.) is equal to two and one-fifth pounds; and the ten-kilogram standard of quantity is, therefore, equivalent to twenty-two pounds, or just one-sixth of a standard Brazil bag.

The money value is not so simple, since Brazilian paper currency is unstable; and the milreis quotation means nothing unless it is considered in connection with the rate of exchange for the same day, i.e., the current gold value of the milreis. This gold value is always given with the daily quotations from Brazil, and is expressed in British pence. The par value of the milreis (1000 reis) is 54.6 cents (gold) of United States money; but its present actual value is only about 15 cents, and it has been as low as 11-1/4 cents. Our dollar sign is used to denote milreis, placing it after the whole number, and before the fractional part expressed in one-thousandths. Thus, 8-1/4 milreis would be written 8$250 RS.

Suppose, for example, a Rio quotation is given at 8$400, with exchange at 7-1/2 d. This means that 22 pounds of coffee have a gold value of 63 British pence (8.4 x 7-1/2 = 63.0), or 5/3, as the Englishman would write it, which is equal to $1.27-1/2, making the coffee worth 5.8 cents per pound. Of course the person familiar with Brazil quotations will not need to make this reduction to the pound-cent term in order to understand the figures. They will have a proper relative meaning to him in their original form; and it must not be overlooked that it is in this form only that they express correctly the value of the coffee in Brazil. It may make a great difference to the Brazilian planter or exporter whether an increased gold value of his coffee arises through a higher milreis bid or an appreciated exchange, simply on account of local currency considerations. That is to say, the purchasing power of a milreis in Brazil will not necessarily vary exactly as the rate of exchange on London.

London quotations are made in shillings and pence, on one hundred-weight (cwt) of coffee. This "cwt" is not 100 pounds but 112 pounds, one twentieth of the English ton (our long ton) of 2,240 pounds. And in all English coffee statistics the coffee quantities are expressed in this ton. A London quotation of 30/9 (30 shillings and 9 pence) for example, is equivalent to $7.44 for 112 pounds of coffee, or 6.64 cents per pound at the normal rate of exchange, $4.80 to $4.86 the pound sterling.

At Havre, the coffee price is given in francs, on a quantity of 50 kilograms. This is 110 pounds and almost as much, therefore, as the British cwt. In normal times the franc is equal to 19.3 cents. A French quotation of 37-1/2, for instance, means, therefore, $7.19 for 110 pounds of coffee, or 6.53 cents per pound.

The Hamburg quotation (formerly from Brazil per fifty kilos) is made on one pound German, equal to 1/2 kilogram, and is expressed in pfennigs. One pfennig is one-hundredth of a mark, and the mark once was equal to 23.8 cents. A German quotation of, say, 31, means, therefore, 7.38 cents (31 x .238 = 7.378) for 1.1 pounds, or 6.71 cents per pound.

Three Kinds of Brokers

In the coffee trade there are three kinds of brokers--floor, spot, and cost and freight.

Floor brokers are those who buy and sell options on the Coffee Exchange for a fixed consideration per lot of 250 bags. The coffee commission rate put into effect June 8, 1920, for round term (buying and selling) by the New York Coffee Exchange was as follows:

COMMISSION RATE ON 250 BAGS

(For Round Term--Buying and Selling)

Up to 10c to 9.99c 19.99c 20c & up per lb. per lb. per lb. Members $12.50 $15.00 $20.00 Non-members 25.00 30.00 40.00 Foreign members 17.50 20.00 25.00 Foreign non-members 30.00 35.00 45.00 Floor brokerage-- Buying or selling 1.50 1.75 2.00

There is at present (1922) a stamp tax of two cents on each hundred dollars value, or fraction thereof, figured on each separate lot.

Spot brokers are those who deal in actual coffee, selling from jobber to jobber, or representing out-of-town houses; the seller paying a commission of about fifteen cents a bag in small lots, and half of one percent in large lots.

Cost and freight brokers represent Brazilian accounts, and generally receive a brokerage of one and one-quarter percent. On out-of-town business, they usually split the commission with the out-of-town or "local" brokers. The out-of-town brokers sometimes, however, deal direct with the importer. All brokers except floor brokers are sometimes called "street brokers." Most of the large New York, New Orleans, and San Francisco brokerage houses also do a commission business, handling one or more Brazilian or other coffee-producing-country accounts.

Important Rulings Affecting Coffee Trading

The United States have no coffee law as they have a tea law--prescribing "purity, quality and fitness for consumption"--but buyers and sellers of green coffees are required to observe certain well defined federal rules and regulations relating specifically to coffee. Up to the year 1906, when the Pure Food and Drugs Act became law, the green coffee trade was practically unhampered; and several irregularities developed, calling into existence federal laws that were designed to protect the consumer against trade abuses, and at the same time to raise the standards of coffee trading.

Under these regulations it is illegal to import into this country a coffee that grades below a No. 8 Exchange type, which generally contains a large proportion of sour or damaged beans, known in the trade as "black jack," or damaged coffee, as found in "skimmings." "Black jack" is a term applied to coffee that has turned black during the process of curing, or in the hold of a ship during transportation; or it may be due to a blighting disease.

Another ruling is intended to prevent the sale of artificially "sweated" coffee, which has been submitted to a steaming process to give the beans the extra-brown appearance of high grade East Indian and Mocha coffees which have been naturally "sweated" in the holds of sailing vessels during the long journey to American ports. Up to the time that the Pure Food and Drugs Act went into effect, artificial "sweating" was resorted to by some coffee firms; and out of that practise grew a suit[320] that resulted in a federal court decision sustaining the Pure Food Act, and classifying the practise as adulteration and misbranding.

The Act also is intended to prevent the sale of coffees under trade names that do not properly belong to them. For example, only coffees grown on the island of Java can properly be labeled and sold as Javas; coffees from Sumatra, Timor, etc., must be sold under their respective names. Food Inspection Decision No. 82, which limited the use of the term Java to coffee grown on the island of Java, was sustained in a service and regulatory announcement issued in January, 1916. Likewise the name Mocha may be used only for coffees of Arabia. Before the pure-food law was enacted, it was frequently the custom to mix Bourbon Santos with Mocha and to sell the blend as Mocha. Also, Abyssinian coffees were generally known in the trade as Longberry Mocha, or just straight Mocha; and Sumatra growths were practically always sold as Javas. Traders used the names of Mocha and Java because of the high value placed upon these coffees by consumers, who, before Brazil dominated the market, had practically no other names for coffee.

One of the most celebrated coffee cases under the Pure Food Act was tried in Chicago, February, 1912. The question was, whether in view of the long-standing trade custom, it was still proper to call an Abyssinian coffee (Longberry Mocha) Mocha. The defendant was charged with misbranding, because he sold as Java and Mocha a coffee containing Abyssinian coffee. The court decided that the product should be called Abyssinian Mocha;[321] but since then, general acceptance has obtained of the government's viewpoint as expressed in F.I.D. No. 91, which was that only coffee grown in the province of Yemen in Arabia could properly be known as Mocha coffee.

Another important ruling, concerning coffee buyers and sellers, prohibits the importation of green coffees coated with lead chromate, Prussian blue, and other substances, to give the beans a more stylish appearance than they have normally. Such "polished" coffees find great favor in the European markets, but are now denied admittance here.

The Board of Food and Drug Inspection decided in 1910 against a trade custom that had prevailed until then of calling Minas coffee Santos when shipped through Santos, instead of Rio.[322]

For years a practise obtained of rebagging certain Central American growths in New York. In this way Bucaramangas frequently were transformed into Bogotas, Rios became Santos, Bahias and Victorias were sold as Rios, and the misbranding of peaberry was quite common. A celebrated case grew out of an attempt by a New York coffee importer and broker to continue one of these practises after the Pure Food Act made it a criminal offense. The defendants, who were found guilty of conspiracy, and who were fined three thousand dollars each, mixed, re-packed and sold under the name P.A.L. Bogota, a well known Colombian mark, eighty-four bags of washed Caracas coffee.[323]

After an exchange of views with the United States Board of Food and Drug Inspection, the New York Coffee Exchange decided that, after June 1, 1912, it would abolish all grades of coffee under the Exchange type No. 8.

The practise in Holland of grading Santos coffees--by selecting beans most like Java beans, and polishing and coloring them to add verisimilitude--known as "manipulated Java," became such a nuisance in 1912 that United States consuls refused to certify invoices to the United States unless accompanied by a declaration that the produce was "pure Java, neither mixed with other kinds nor counterfeited."

The United States Bureau of Chemistry ruled in February, 1921, that Coffea robusta could not be sold as Java coffee, or under any form of labeling which tended either directly or indirectly to create the impression that it was Coffea arabica, so long and favorably known as Java coffee. This was in line with the Department of Agriculture's previous definition that coffee was the seed of the Coffea arabica or Coffea liberica, and that Java coffee was Coffea arabica from Java. Coffea robusta was barred from deliveries on the New York Coffee Exchange in 1912.

During the greater part of the year 1918, the United States government assumed virtually full control of coffee trading. It was a war-time measure, and was intended to prevent speculation in coffee contracts and freight rates, to cut down the number of vessels carrying coffee to this country so as to provide more ships for transporting food and soldiers to Europe, and to put the coffee merchants on rations during the stress of war. On February 4, 1918, importers and dealers were placed under license; and two days later, rules were issued through the Food Administration fixing the maximum price for coffee for the spot month in the "futures" markets at eight and a half cents, prohibiting dealers from taking more than normal pre-war profits, or holding supplies in excess of ninety days' requirements, and greatly limiting resales. On May 8, the United States Shipping Board fixed the "official" freight rate from Rio de Janeiro to New York at one dollar and fifty cents per bag, which, without control, had risen to as high as four dollars and more, as compared with the ordinary rate of thirty-five cents before the war. On January 12, 1919, two months after the armistice was signed, the rules were withdrawn, and the coffee trade was left to carry on its business under its own direction.

Some Well Known Green Coffee Marks

Practically every bag of good quality green coffee is imprinted with a brand which indicates by whom it was shipped. These imprints are known in the trade as "green coffee marks." Many of them, through long usage, have become celebrated in international trade. One of the most famous was HLOG. This stood for "Heaven's Light Our Guide," and was owned by John O'Donohue's Sons. For many years it was used on Mocha coffee, but it is now out of existence. Other well-known Mocha marks are M R (Maurice Ries) with the figure of a camel, a star, or deer's head between the letters; L F or L B (Livierato Freres); C F or C B (Caracanda Freres).

Bogota marks includes PAL (in triangle) Bogota (P.A. Lopez & Co.); Camelia; Pinzon & Co.; Salazar; AOL (in triangle) Bogota; and Carmencita Manizales Excelso (Steinwender, Stoffregen & Co.).

Among the best known Medellin marks are FAC & H (F.A. Correa & Sons): PEC & C (Pedro Estrado Co.); LMT & C (Louis M. Torro & Co.); A & C (A. Angel & Co.); E C S Medellin Excelso (Eppens, Smith Co.); Balzacbro Medellin Excelso (Balzac Bros.); La Rambla (Banco Lopez); and Don Carlos Medellin Excelso (Steinwender, Stoffregen & Co.).

Caracas marks show J P P & H (Juan Pablo Perez & Sons); HLB & C (H.L. Boulton & Co.); FST & C (Filipe S. Toledo & Co.); JLG (J.L. Garrondona); and many others. Kolster (Kolster & Co.) is a well known Puerto Cabello mark.

Maracaibos bear numerous marks, chief among which are: M & C (Menda & Co.); Cogollo (Cogollo & Co.); Fossi (Fossi & Co.); B M & C (Breur. Moller & Co.); B & C (Blohm & Co.); FST & C (Filipe S. Toledo & Co.); V D R & C (Van Dessel, Rodo & Co.); and J E C & C over R G E (J.E. Carret & Co.).

A prominent Mexican mark is P A N (Rafael del Castillo & Co.).

Brazil coffee is usually marked merely with the initials of the firm or bank financing the shipment. Some representative Brazilian marks are: Aronco (in rectangle) Brazil; J A & Co (in rectangle) Brazil Rosebud; J A & Co (in rectangle) Brazil Bourbona--all used by J. Aron & Company; S S C (in circle) Rio; S S C (in triangle) Santos; both used by Steinwender, Stoffregen & Co.; Sions M/M Bourbns (Sion & Co.); and Nossack V S S C (in swastika), used by Nossack & Co.

There are hundreds of other marks. In most countries they change so often that one rarely stands out above the rest.