A Perfect Brew: Leveraging Intangible Capital to Move up the Coffee Value Chain

Sustainability Science Program Working Paper No. 2018-01

Intan Hamdan-Livramento, Luis Samper, Daniele Giovannucci, Luciana Marques Vieira, and Calestous Juma

Abstract

Coffee is one of the most important traded agricultural commodities. It is a commodity that is produced in the Global South but consumed mainly in the Global North. Coffee’s global value chain is thus heavily influenced by consumers in these high income countries. However, newer consumption patterns are triggering a change in the coffee business model. Coffee aficionados who are interested in the quality of the coffee beans they consume and also in knowing how the coffee plants are farmed and harvested, and if the growers are receiving a fair wage are helping coffee growers to earn more from their coffee harvests. This paper examines how the new preference for coffee consumption is reshaping its global value chain, and how this change offers an opportunity for coffee growers to earn more income by catering to this new consumption trend. It provides important insights into how agrarian economies should invest and cultivate their intangible assets to enhance their value chain participation and improve their competitiveness in international trade.

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