International Coffee Agreement

International Coffee Agreement

The International Coffee Agreement (ICA) is an international treaty that aims to regulate the global coffee market and ensure the stability of coffee prices. It was first established in 1962 and has undergone several revisions since then. The current agreement, known as the International Coffee Agreement 2007, is in force from October 1, 2007, to September 30, 2022.

History

The International Coffee Agreement was initially created in response to the coffee crisis of the early 1960s. During this period, the coffee market experienced significant price fluctuations, which had a detrimental impact on coffee-producing countries. The ICA was designed to stabilize prices and provide a framework for cooperation among coffee-producing and coffee-consuming nations.

Over the years, the agreement has been revised multiple times to adapt to changing market conditions and address emerging challenges. The most recent revision, the International Coffee Agreement 2007, introduced new provisions to promote sustainable coffee production, improve market transparency, and enhance the participation of coffee farmers in decision-making processes.

Objectives

The main objectives of the International Coffee Agreement include:

1. Stabilizing coffee prices: The agreement aims to prevent extreme price fluctuations by implementing mechanisms such as export quotas, buffer stocks, and price stabilization measures.

2. Promoting sustainable coffee production: The ICA encourages environmentally friendly and socially responsible coffee production practices, with a focus on improving the livelihoods of coffee farmers and protecting the environment.

3. Enhancing market transparency: The agreement promotes the exchange of information and data among member countries to ensure transparency in the coffee market. This helps stakeholders make informed decisions and reduces market volatility.

4. Facilitating international cooperation: The ICA provides a platform for coffee-producing and coffee-consuming countries to collaborate on issues related to coffee production, trade, and consumption. It encourages dialogue, knowledge sharing, and capacity building among member countries.

Implementation

The International Coffee Agreement is implemented through various mechanisms, including:

1. International Coffee Council (ICC): The ICC is the highest decision-making body of the agreement. It consists of representatives from member countries and meets regularly to discuss and make decisions on coffee-related issues.

2. Executive Director: The agreement establishes the position of an Executive Director, who is responsible for overseeing the day-to-day operations of the International Coffee Organization (ICO), the intergovernmental organization that administers the agreement.

3. Market Information System (MIS): The MIS is a platform that provides up-to-date information on coffee market trends, prices, and other relevant data. It helps member countries monitor market conditions and make informed decisions.

4. Consultative Forum on Coffee Sector Finance: This forum brings together stakeholders from the coffee industry, including financial institutions, to discuss and address financial challenges faced by coffee producers.

Impact

The International Coffee Agreement has had a significant impact on the global coffee market. It has helped stabilize coffee prices, reduce market volatility, and promote sustainable coffee production practices. By facilitating international cooperation and dialogue, the agreement has also contributed to the development of a more inclusive and equitable coffee industry.

See also

• Coffee production
• Coffee consumption
• Fair trade coffee

External links

• International Coffee Organization