BOGOTA Nov 23 Coffee-growing nations should
buy Starbucks and create their own distribution chain as the
U.S. company grapples with slowing sales, Colombia's coffee
federation chief said in an interview published on Sunday.
Gabriel Silva, director of the National Federation of
Coffee Growers, also told El Tiempo newspaper that Colombia
will accumulate four times the coffee stocks it did a year ago
to build inventories and shore up coffee prices.
Starbucks (SBUX.O), famous for its pricey lattes, has
fallen victim to the U.S. economic downturn as sales growth
slows in the United States and the Seattle-based chain plans to
close 600 U.S. stores.
"I am going to propose to my colleagues that we chip in to
buy Starbucks. This will reinforce our fight to defend coffee
origins," Silva said. "What I am proposing is not so difficult.
With $200 million to $300 million, the coffee world could
Prices for commodities from oil to metals have slumped on
fears a global recession will cut into demand. But coffee
producers believe the bean is better placed to rebound because
market fundamentals will support prices.
ICE Futures U.S. March arabica KCH9 closed 0.60 cent
lower at $1.1075 per pound on Friday.
"We are going to participate more aggressively in the
market to build stocks in the next few months ... the idea is
to accumulate coffee to support the price. It is not so
difficult as there is a world deficit in coffee," Silva said.
"To impact the market, we need to accumulate around 200,000
sacks," he said. "Until we have a renumerative price, it is
better to store coffee than export at a low price."
Colombia, the world's No. 1 exporter and top producer of
high-quality arabica beans, said recently rains had trimmed its
production for this year to around 12 million sacks, though it
still expects to output to rise to 17 million bags by 2014.
Silva said exports for this year should be around 11.2
He said around half of the 860,000 hectares (2.1 million
acres) of coffee-producing land in Colombia had been renewed
and he expected all producing areas to be renewed in five
Silva said the federation would have 170 stores for its
branded Juan Valdez product this year -- 135 in Colombia and 35
overseas with a target of 300 stores by 2010.
(Reporting by Patrick Markey in Bogota, editing by Maureen