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The Coffee Industry Board on Tuesday shipped the first batch of 16,500 kilograms of green coffee bean to Zhejiang Dunns River Import and Export Company Limited in China, under a supply deal to sell 70,000 kg to the Asian powerhouse.

The supply contract is worth US$2 million and marks the continued execution of Jamaica’s strategy to diversify its premium coffee market beyond Japan.

The shipment was sent off with fanfare at the Kingston port.

“This for us is going to do a number of things – it’s going to give us opportunities to expand our coffee production, and it’s going to make us less vulnerable to one marketplace,” said Christopher Tufton, minister of agriculture and fisheries, who is also looking for growth in the North America and Europe market.

“We honour and respect our existing partnerships but in order to grow and prosper we need to expand our market base.”

State-owned Mavis Bank Coffee Factory and Wallenford together are said to control 70 per cent of the Japan market.

But those supply arrangements are expected to change once Government finalises the sale of the two entities – processes that are said to be well advanced.

Four additional coffee shipments will be sent to Zhejiang Dunns River over the next two years to complete the contractual arrangement, which handles the commercial transactions of Hangzhou Coffee and Western Foods Association, with whom the Government of Jamaica signed the deal last July.

Under the memorandum of understanding with the Chinese entity, which represents some 800 cafés, coffee roasters and specialists within China, it was agreed that Hangzhou would be the exclusive importer of Jamaican coffee, including Blue Mountain Coffee, into China, initially for a period of two years.

Hangzhou will process and distribute the processed coffee throughout their network of high-end cafes and coffee shops.

Only five per cent of Jamaican coffee is consumed domestically; the other 95 per cent is sold abroad through importers and coffee brokers.

Japan traditionally buys 85 per cent of green beans and 65 per cent of the overall volume exported

“This shows a commitment to market diversification, and by market diversification we mean preserving existing markets and expanding into new regions in the world that are now able to appreciate and pay for fine Jamaican coffee,” according to Howard Mitchell, chairman of the CIB.

Tufton also hinted that the government could be out of the commercial aspect of the coffee industry by the end of the calendar year, with the divestment of Mavis Bank far advanced, and the hunt for private procurement and investment in Wallenford to begin shortly.

According to Tufton, when this is accomplished, the CIB’s role will be restricted to quality control.

“The new players who are coming in will have to take on a greater burden and responsibility to identify, to tap into and to position themselves into markets around the world, and this for us will become a much more efficient approach and should augur well for all the stakeholders,” he said.

Source: Jamaica Gleaner