Coffee is one of the most popular drinks in the world. It’s second only to water. Its history has endured and spread from the humble plains in Ethiopia to the virtually every part of the world. For some context, over 2.25 billion cups of coffee are made daily source. Thanks to its uniquely refined flavor, energizing effects, and numerous health benefits, coffee will continue to remain a staple of society for eons to come.
So what has made the coffee industry so successful? What’s behind its impact on history and its unparalleled popularity? In this article, we take a closer look at the origins of the world’s greatest drink and learn more about the long journey of coffee, how it made a mark in global history and economy and where it’s heading.
The History of Coffee
This magical coffee bean has its origins rooted in the country of Ethiopia. The story goes that a goat herder named Kaldi accidentally discovered it when he noticed his goats became particularly alert after eating some “berries”.
He reported this to the monastery abbot, who then made a drink out of the same berries. He drank it, and it kept him alert and awake during his evening prayers. After sharing the secret with other monks, the journey of coffee began to reach the Arabian peninsula and circulate to the far-reaching corners of the world.
Brazil Becoming the Top Producer
By the 18th century, French leaders made coffee a cash crop and brought it to Brazil. A huge number of slaves were forced to work on farms to produce more yields. By 1840, Brazil became the largest producer of coffee — and it still is.
Roughly 300,000 coffee farms blanket the country’s landscape, producing several millions of bags of beans every marketing year. Today, the coffee market is the heart of Brazil’s growing economy and has enabled the country to thrive in ways otherwise not possible.
Coffee Became the Drug of the Civil War
In 1668, the Dutch or British first brought coffee to New York. Years later, it evolved into a symbol of patriotism and marked independence. During the American Revolution, drinking tea was perceived as unpatriotic as it was closely associated with British culture. Coffee became a trademark for “true U.S. Americans,” and they loved it.
By the time the American Civil War broke out in 1861, coffee as drinks were included in rations. Soldiers enjoyed it because it gave them the energy to keep fighting.
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The Growth of Coffeehouses in the U.S.
In the late 19th century, coffee — which used to only be exclusive in government offices — became accessible to the masses. It was affordable. People could buy and drink it at any time. Offices in the U.S. became a social place for people to meet, later inspiring the “café culture” for modern coffee houses.
The period after World War II represented a new age of media. With newspapers, magazines and television promoting the benefits of coffee, it reached a new milestone of popularity.
In 1987, Howard Schultz decided to open an espresso bar after he saw hundreds of cafés and espresso bars lining the streets of Milan, Italy. Today, Starbucks boasts thousands of stores within the U.S. and the rest of the world. The brand and its story spurred the revolution of the modern coffee culture. Coffee shops became a place for people to gather.
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From Farm to Cup
Having covered a general history of coffee, let’s take a closer look at the actual bean and the process it undergoes to make it to your actual cup.
The journey from the farm to the cup starts from the moment coffee seeds are planted. It takes about three to four years for the coffee plants to bear cherries ready to be harvested. They’re ripe when the fruits turn deep red.
Coffee plants have high and low yields in cycles — this is called the biennial effect. It means if the harvest at the beginning of the year is bountiful, the subsequent yield will be low. In coffee-growing nations like Colombia, coffee plants bear fruits twice. The high-yield is the main crop and the following low-yield is the secondary crop.
Harvesting To Roasting Coffee
Coffee cherries are harvested in two ways:
- Strip picked: Strip picking involves using large machinery to harvest all the coffee cherries from the tree at once, regardless of how ripe they are. While this method is faster and more straightforward, it does come with a downside: there’s a greater chance of collecting unripe or flawed coffee that could affect the quality during the next stages of processing.
- Selectively picked: Pickers individually harvest the ripe cherries. This method is obviously less efficient but allows only the best beans to be selected.
After harvesting, the cherries are moved to the plant. Coffee workers process them in three main methods — dry, wet, and honey. The dry method is an older technique where cherries are manually laid to dry under the sun and turned throughout the day. The wet process uses a machine to remove the pulp. In the honey process, coffee cherries are partly removed, leaving some fruit on the beans. These beans are then dried, letting the remaining fruit sweeten and flavor the coffee. It’s like a tasty compromise between fully washed and natural methods. For the record, how a coffee is processed has a major influence on the final taste of the coffee bean.
After processing, these processed beans sun-dried until they retain 11% moisture before preparing them for storage. Workers then use another machine to grade and sort the beans based on size, weight and imperfections.
Once done, producers export and ship them around the world. The beans then reach the palates of coffee expert who analyzes their taste and quality. If it meets the quality standard, they’re roasted, ground and brewed for people to enjoy. Obviously, there are different standards for coffee. If you want to learn more, check out the Specialty Coffee Association (SCA) which is a governing body tasked with establishing worldwide coffee standards.
The Economic Impact of Coffee in the U.S.
The U.S. consumes more coffee if measured by pure quantity than any other country in the world. As such, this unassuming but magical bean plays a critical role in the country’s economy. The coffee market is projected to grow at a rate of 3.21% every year between 2023 to 2028. To compare that with the current state of coffee demand, people in the US spend $48 billion each year in coffee shops.
Several factors will stretch the demand for coffee. One is the preference for specialty coffee — the highest grade available in the market. Technically speaking, coffee rated by the SCA (mentioned earlier) with a score of 80 or above is classified as specialty coffee. Below are some top ranked specialty coffees that are certain to give you a good sampling of what the world of high-end coffee has to offer.
Additionally, versatile brewing methods, like cold brew or capsules and AeroPress, have enticed people to enjoy the drink in various ways. Thanks to this, many Americans can indulge in their favorite cup of joe at home.
The Global Coffee Industry
Outside of the U.S., the global coffee market is also growing. Based on forecasts, the international market will balloon to $134.25 billion in 2024 at an impressive 5.32% annual rate.
While the U.S. has the largest coffee market globally, many believe that the Asia Pacific region will see the fastest growth. Key drivers for this are the increased demand of employees for coffee-related businesses, the expansion of coffee chains locally and the rise of e-commerce retail sales.
Asian Coffee Market
Japan has the largest coffee market in Asia, with sales racking up to $34.45 billion in 2020. It was initially a tea-drinking nation, but the rest of Asia is gradually shifting to coffee. This preference change will catapult this increasing demand for coffee and will have an opposing impact on tea consumption. In Japan alone, coffee intake was up by 5.8% from 2004 to 2019.
A similar trend is seen in Shanghai, China, which now has the highest number of stand-alone coffee shops around the world — even more than Tokyo, London and New York. With 6,913 outlets, young coffee aficionados in Shanghai won’t run out of options for their daily caffeine dose.
European Coffee Market
Like the rest of the world, the European coffee market will continue to say major growth. Its current valuation is $46 billion, but experts project the market size to consistently grow to almost $56 billion in 2028.
It owes its astounding growth to the robust consumption of coffee in European countries. Between 2020 and 2021, the region accounts for about 33% of coffee consumed worldwide. By country, U.K. consumers spend the most on coffee in restaurants and cafes.
Latin American Coffee Market
Latin America is the center of the global coffee industry for two reasons — many countries in this region are heavy consumers and major producers of coffee. In 2019, Latin America produced 60% of coffee consumed worldwide.
Brazil is the largest supplier of coffee in the world. The country exported a total of $8.5 billion of coffee in 2022. It’s followed by Colombia and Peru, both producing millions to billions of dollars worth of coffee. Other nations that grow and supply the global demand for beans include Honduras, Costa Rica, Guatemala, Nicaragua and El Salvador.
The Challenges Ahead
The current supply of coffee barely meets the worldwide demand. But some future challenges may create more disparity in the supply-demand chain.
One of the hurdles of the coffee market is the bottlenecks in shipment. Coffee producers are experiencing logistic problems in transporting goods as the trucking industry, which accounts for 72.5% of domestic shipping, is suffering from massive driver shortages. In addition, there is a drastic shortage of shipping containers as a result of the COVID-19 pandemic. The drying up of the water routes in South America and the wildfires in Canada are both causing shipment headaches.
Producers hope the situation will change as the impact of the pandemic minimizes over time.
Temperature changes can affect the growth of coffee shrubs. It presents challenges for farmers. The arabica plants — the most commonly produced beans — are fragile to rainfall and heat. It means unstable weather can result in low yields, which has a rippling effect on the demand and supply.
Based on predictions, the agricultural landscape for coffee could drastically change by 2050 due to the rising temperatures in existing coffee-producing nations. The coffee-farm area in the top five producers today — Ethiopia, Colombia, Indonesia, Brazil and Vietnam will decrease in 2050 as these tropic regions turn hotter and become unsuitable locations for growing coffee.
Conversely, cooler regions like the U.S, Uruguay, Argentina and China will likely see an upswing in the growing suitability of their lands.
The process involved from farm to cup is labor intensive. Producers struggle to employ people because of the manual tasks involved in every process, from harvesting to roasting. In addition, most young professionals in coffee-producing countries move to the city, resulting in an ongoing shortage of skilled coffee workers.
Producers are desperate for innovation in farming and post-harvest and are looking to adopt technologies and new techniques to reduce the need for manual labor. They hope this change can help solve the lack of labor, especially during picking season.
High Labor Cost
Coffee labor costs are notably high due to a convergence of factors. Firstly, coffee cultivation is labor-intensive, necessitating manual harvesting on uneven terrains. Moreover, the beans’ delicate nature mandates careful handpicking to ensure quality.
Pickers demand relatively high wages since most coffee production relies on manual labor. Another reason for this is the rising cost of exported coffee. Lastly, more and more families that run coffee farms are unable to incentivize their children to continue the business into the next generation.
This dilemma financially strains coffee producers as labor already accounts for 40%-60% of their total expenses. Many are left without choices and give in to the call for high salaries because no one else can do the job. Once again, it all comes back to the simple law of supply and demand.
In this case, investing in technology to perform some of the tasks in coffee production, such as using A.I. to automate inventory orders and manage staffing, can support producers. Gradual improvements in farms, like mechanizing picking, can eventually help curb the problem with labor costs.
The History of Coffee and Its Success: Final Thoughts
Coffee has carved its indelible mark in society and has been a staple for human society for many centuries. From a humble grassland in Ethiopia, it became the “drug” of choice for soldiers during the Revolution, an exclusive beverage for government workers and finally a mass-enjoyed drink today. It’s one of the few commodities in the world that could be rightly considered a pillar of society. Coffee bars are exploding in growth and millions of people couldn’t go a day without drinking a cup of their morning joe. Such is the state of coffee in this modern day.
As the demand for coffee surges, technology will play an essential role in improving the situation of coffee farmers and laborers and sustaining the supply. Adopting new farming and harvesting techniques will make the production process more efficient and less arduous for workers. If these adjustments get implemented in a reasonable and sustainable manner, the coffee industry will likely continue to experience the same exponential growth that it has seen in recent decades.