Coffee Industry Profile
Coffee has been a valuable segment of the Philippine economy. The Philippines became the 4th largest exporter of coffee in 1880, but coffee leaf rust destroyed the farms in 1894.
The Philippines is one of the few countries that can produce the four types of coffee: Robusta, Arabica, Liberica (Barako), and Excelsa. Arabica is the flavor variety and is mostly used as premium or gourmet coffee; Robusta is used as a blender to Arabica as well as in instant coffee. Liberica or Kapeng Barako has rich and intense taste and is best served black. The most common type is Robusta, which accounts for about 70 percent of total coffee production. Coffee is sold as green, roasted, or ground beans, and as soluble instant coffee.
The proliferation of local and foreign coffee stores (e.g. Starbucks, Figaro, etc.) and brands (e.g. Nestle, Cafe Amadeo, etc.) is a strong indication of its rising demand in the marketplace. However, failure to meet this growing demand is a problem within the industry, especially with a 0.2% annual decline in coffee volume over the past 10 years (PSA, 2018).
According to Philippine Statistics Authority (PSA), national production of 60,640.95 metric tons (MT) dried cherries in 2020 was not even enough to supply local demand, which was estimated at 198,720 MT. The country imports coffee to meet local demand. Average productivity in 2021 is 0.54 MT dried cherries/ha.
Problems in the Industry
The development of the industry is hampered by insufficient quality planting materials (high yielding) for expansion and replanting areas, low yield, and low quality beans. Low yield is due to: mismatch between the variety planted and environmental conditions, limited information on nutrient and water status, and occurrence of pests. Rising temperature due to climate change also threatens the industry as it might reduce the areas suitable for coffee growing, bring drought, increase the range of diseases and kill insects that pollinate coffee plants.
Data Source: Philippine Statistics Authority. 1990-2022.
- Volume of production of coffee in metric tons (MT)
- Area of production of coffee in hectares (ha)
- Yield of coffee production in metric tons (MT)
- Value of Production at Current Prices in Million PhP
- Value of Production at Constant 2018 Prices in Million PhP
- Gross Value Added at Constant 2018 Prices in Million PhP
- Gross Value Added at Current Prices in Million PhP
- Gross Supply of coffee in metric tons
- Import value of coffee in thousand metric tons
- Export value of coffee in thousand metric tons
- Farmgate price of Coffee in Pesos per kilogram
ISP for Coffee
The goal of the Coffee ISP is to increase yield of dried cherries per tree, and to improve quality of coffee products to Grade A green coffee beans and Q grade of at least 82 for cup quality.
The coffee ISP has accomplished significant S&T based interventions to address the needs of the industry and to achieve its vision of highly productive and high quality coffee. Other interventions are to provide the necessary S&T solutions for a vibrant coffee industry. The ISP will further develop technologies on quality planting materials and nursery management; soil, nutrient and water management; pest management; and postharvest technologies. During this period, decision support tools will also be developed, climate change adaptation strategies, value-added products, traceability system, and database information network.
By 2028, there should already be available quality planting materials. It is also envisioned during this period to have coffee areas as agri-tourism sites, and that there will be a real-time crop monitoring system. Deployment of soil, water, pest and postharvest technologies will be done to enhance the transfer of developed technologies. Impact assessments of developed technologies will also be done during the period.
Strategic R&D is DOST-PCAARRD’s banner program comprising all R&D activities that are intended to
generate outputs geared towards maximum economic and social benefits
Products, equipment, and protocols or process innovations developed to improve productivity, efficiency,
quality, and profitability in the agriculture and aquatic industries, and to achieve sustainable
utilization and management of natural resources
Somatic embryos ready for transfer to Plantlet Producing more good quality beans starts from planting good quality planting materials that are high yielding. To produce true-to-type varieties, CvSU conducted initial...Read More
Banding patterns observed for the different coffee variety using the SSR 124577 marker The Philippine Genome Center has conducted DNA characterization of National Seed Industry Council (NSIC) – registered varieties...Read More
Spectral signature collected from Cavite (each line correspond to a unique soil sample) Expansion of production area, conversion to coffee production, or replanting of old coffee trees require information on...Read More
Through PCAARRD funding, UPLB developed the FertiGroe® nitrogen (N), phosphorus (P) and potassium (K). These inorganic single fertilizers release nutrients more slowly than the conventional inorganic fertilizers, and have strong...Read More
In support of the organic agriculture program of the country, technologies for organic Arabica production have been developed by the Benguet State University (BSU) through DOST-PCAARRD funding, and are for...Read More
Harvesting cherries at the right maturity produces better tasting coffee. Through the SARAI Program, University of the Philippines Los Banos (UPLB) researchers developed a mobile application named CAPHE: Coffee Application...Read More
Morpho-developmental changes in Robusta coffee during inflorescence emergence (BBCH 51-59), flowering (BBCH 60-69), berry development (BBCH 70-79) and berry ripening (BBCH 80-89) Understanding growth patterns is essential in developing effective...Read More
Coffee depulper Producing a quality cup of coffee involves not only producing high quality cherries, but also proper post harvest activities to come up with good quality GCB. Coffee cherries...Read More
Technology Transfer Initiatives
Technology transfer initiatives ensure that the outputs of R&D and innovations are transformed
into viable and applicable technologies that help intended users
This study investigated the coffee value chain in the CALABARZON and developed intervention models to create a smart food value chain. Specifically, this study intended to: 1) operationalize the Smart...Read More
The project is being implemented in the three major coffee producing municipalities of Sultan Kudarat namely Sen. Ninoy Aquino, Kalamansig & Lebak. The project has a goal to increase coffee...Read More
This TechnoMart project aims to establish a viable and sustainable Arabica coffee enterprise in the Cordillera, specifically in Sagada, from production of beans to processing of roasted ground coffee, ready...Read More
Policy Research & Advocacy
Analysis of policy concerns and advocacy of science-informed policies ensures that the AANR policy environment is conducive for S&T development
Competitiveness of Philippine Robusta Coffee Industry under the ASEAN Economic
Producing coffee in the Philippines was found to be competitive under the import substitution scenario wherein producing domestically is cheaper than importing. This implies that the Philippines should focus on improving its domestic production of coffee. Based on the results, coffee yield (0.636 mt/ha) should not go down by 14% in order to maintain its import competitiveness. Results also revealed that to attain export competitiveness, yield must go up by 34% or domestic cost must decrease by 38%.
Lapiña, G. F. and Andal, E. T. (2017). ASEAN Economic Community: Opportunities and Challenges for the Crops Sector. Los Baños, Laguna, Philippines: Philippine Council for Agriculture, Aquatic and Natural Resources
Coop for a Cup: Role of Cooperatives in Coffee Technology Adoption
As a labor-intensive country, one of the major driving forces of Philippine agricultural development is technology. Aside from cost reduction, technology enables farmers to enhance the quality of their produce, discover effective and efficient farming techniques, and ultimately address the risks and challenges inherent in agriculture. The success of a technology, however, boils down to its dissemination and adoption at the field level. It is important to recognize that technology is deemed useless if farmers will not adopt it, which is why understanding a farmer’s behavior, particularly the factors affecting their decision to adopt a certain technology, is crucial.
In 2017, PCAARRD funded a program titled, “Role of Cooperatives in Technology Adoption for Improved Production and Market Efficiency in Dairy Buffalo and Coffee”. Dr. Agham Cuevas from the University of the Philippines Los Baños led this initiative to determine how cooperatives and other rural/community-based organizations (RBOs) affect technology adoption, and production and marketing efficiency, assess their effectiveness as platforms for innovation and technology transfer in the rural areas, and provide specific recommendations on how cooperatives/RBOs can enhance technology adoption.
Impact of Coop Membership in Technology Adoption and Production and Marketing Efficiency
The study showed that cooperatives/RBOs play an important role in stimulating the adoption of technology for the enhancement of production and marketing efficiencies. In fact, studies have shown that collectively, small-holder producers share information, pool resources, and distribute costs and risks among themselves to improve yield and productivity, which would not be possible if the smallholder farmer is working alone.
Among 380 respondents, 58 percent is a member of a cooperative/RBO. Findings show that members have a greater tendency to adopt technologies (52%) relative to non-members (40%). Farmers attribute this to the prioritization of cooperative members in the provision of agricultural inputs and technical services, attendance in various training, and linkages with other stakeholders. These provisions give members greater information, resources, and support. Likewise, membership was also found to significantly affect a farmer’s ability to maximize their output given a level of inputs (technical efficiency). This suggests that cooperative members are more productive than those who are not. It was also highlighted that members have greater marketing efficiency thanks to better selling prices, greater access to buyers, and better processing activities.
Cooperatives/RBOs identified the following institutional constraints which affect the performance of their industries:
Lack of information/Poor access to technologies
High input and transportation costs
Poor access to credit
Limited market access
Challenges and Recommendations
Although cooperatives serve as instruments in both industries, they are still confronted with issues such as membership delinquency, lack of participation among members, poor planning, and lack and/or mismanagement of resources. Hence, policy incentives to form and join cooperatives must be provided and associations must be strengthened through management and developmental seminars for its members. Further, greater public investment is warranted for technology diffusion, enterprise development, and establishment of facilities and processing centers near the farmers.
Cuevas, A.C., Duque, J.R., Quilloy, A.M., and Mina C. (2018). Role of Cooperatives in Technology Adoption for Improved Production and Market Efficiency in Dairy Buffalo. Los Baños, Laguna, Philippines: Philippine Council for Agriculture, Aquatic and Natural Resources Research and Development – (Project Report)