Globalization Of Coffee : Starbucks

Good Essays

Devon Jones-Stewart
Professor Solomon
22 March 2015
Globalization of Coffee: Starbucks

Globalization is the process of interaction and integration between the people, companies, and the governments of different nations. Coffee is the second largest commodity in the world. Globalization has had an immense impact on various goods none being as big as its impact on the coffee industry. In the 1970 coffee beans went for three dollars a pound, but since that 1970 it has gradually decreased due to the increase in the production of coffee. Even though demand has increased, it was met with over production. Which in 2000 coffee prices reached a historic low, impacting farmers all around the world. This crisis came from very poor quality Vietnamese coffee flooding the market, causing the balance between supply and demand to be dramatically altered. The poor quality coffee beans forced Arabica farmers to lower their prices. In the long run this caused a lower quality in coffee beans, lower customer expectation, and low interest in coffee. Most importantly families of Coffee growers saw their incomes diminish to half what is was or worst. Farmer families struggled to have enough money to live on, some families decided to give up on growing Coffee beans and other gave up on farming completely. The Coffee bean industry still hasn’t recovered from these events, and it’s estimated that the industry has lost hundreds of millions of dollars in revenues due to low production.

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