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The International Coffee Agreement is a United Nations agreement establishing the International Coffee Organization. Initially created in 1963 (and extended or renegotiated several times since), this agreement was designed to help stablize coffee prices. It was created as a response to a crash in the the coffee market in the late 1950s which lasted into the early 1960s [1]. Since the original agreement, there have been five subsequent agreements, ratified in 1968, 1976, 1983, 1994, and 2001.

Background

Prior to the original agreement, the global coffee market was prone to wild swings in price, with overproduction often drastically affecting the income of major exporters of coffee. In previous years, organizations such as the National Coffee Association had opposed such agreements on the grounds that they infringed upon free trade (and likely resulted in a higher prices for consumers). However, against the backdrop of the Cold War, such organizations came to support the idea of quotas to prop up the price of coffee so as to prevent the worsening of poverty conditions which could have the affect of opening the door to communist influence in developing countries[2]

Individual Agreements

There have been several International Coffee Agreements since its inception, each one requiring negotiations to address contemporary issues.

1962

The original Internation Coffee Agreement established quotas which limited world coffee exports to major consuming countries to a total of 45.6 million bags annually, with Brazil being allowed a plurality of the quota (18 million bags). While it was drafted on September 28, 1962, this agreement was not actually ratified until 1963. The agreement dictated that exported coffee include country of origin certification to guarantee the orgin of the coffee.

This initial version of the agreement is considered to be largely symbolic as all provisions were voluntary, and the producing countries were not limited in their exports to countries with low consumption rates. Additionally, with 90 days notice, any participating country could withdraw from the agreement. Even with the weakness of enforcement in this version of the agreement, the United States of America, one of the major consumers of coffee in the world, initially balked at ratifying the agreement. Against concerns of high coffee prices, the United States did not officially approve of this agreement until February of 1965, but only after export quotas were increased by another 2.3 million bags[3].

External links

See also


References

  1. International Coffee Organization - History
  2. Mark Pendergrast (1999). “The Coffee Kingdoms”, Uncommon Grounds: The history of coffee and how it transformed our world, 276. ISBN 0465054676.
  3. Mark Pendergrast (1999). “The Coffee Kingdoms”, Uncommon Grounds: The history of coffee and how it transformed our world, 277-279. ISBN 0465054676.

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