China may be best known for tea but it's emerging as a key coffee producer. One of the world's biggest coffee merchents - Switzerland's Volcafe - recently signed a joint venture with a Chinese producer. Hayley Platt looks at what's happening to the coffee industry.
70 million cups of coffee are consumed in Britain everyday. It could soon replace tea as the nation's favourite brew. Stephen Rappaport is part of that revolution. He runs Pact Coffee which supplies the high end market. SOUNDBITE: Stephen Rappaport, CEO and Founder, Pact Coffee, saying (English): "The way that we compete is because we have real one-on-one relationships with our customers. It's something the supermarkets can't offer. We know what product individually each customer likes and we make recommendations." Pact buys coffee directly from farmers in order to get the best beans. And it pays a high premium in a world market that's becoming increasingly volatile. Droughts in Brazil and a devastating crop fungus in Central America have seen futures prices soar. Stephen Hurst is MD of coffee importers Mercanta. SOUNDBITE: Stephen Hurst, Managing Director, Mercanta Limited, saying (English): "If we look at it and say Brazil's the world's biggest producer of coffee, so what happens there matters. It seems the rainfall patterns have been disrupted, there should be a rainy period after the harvest, let's say in August, September, October which rather failed this year Arabica beans have risen almost 30 percent since mid-July. They topped $2 a lb in August and have gained another 10% since then. That could benefit China. It's been steadily growing its Arabica crop over the past decade. SOUNDBITE: Stephen Hurst, Managing Director, Mercanta Limited, saying (English): "They produce at least 1 million bags of Arabica coffee, which isn't huge but it's not too much smaller than Cost Rica for instance and I'm sure they will continue to grow that production in the Yunnan, the tea producing area, which can also produce coffee." Stephen hasn't bought any Chinese coffee yet. But one of the world's biggest coffee merchants has. Switzerland's Volcafe has just signed a deal to buy beans from China. Like Britain's taste in hot drinks the market is clearly changing.