UNIT 8 INTERNATIONAL COMMODITY

AGREEMENTS AND
ORGANIZATIONS
Structure
8.0 Objectives
,8.1 Introduction
8.2 Coffee: International Coffee Organisation
8.3 Pepper: International Pepper Community
8.4 Rubber: International Rubber Study Group
F
8.5 Tea: International Tea Committee
8.6 Coconut
8.6.1 The Asia and Pacific Coconut Community
8.6.2 Coconut Genetic Resources Network
8.7 Cashew
8.8 Common Fund for Commodities
8.9 Let Us Sum Up
8.10 Glossary
Check Your Progress: Possible Answers
References of Websites

8.0 OBJECTIVES
After studying this unit you should be able to:
recognize the implications of international perspectives for plantation
crops like Coffee, Tea, Rubber Spices etc.;
discuss the importance of specific international trade agreements; and
appreciate the role of international commodity organizations.

8.1 INTRODUCTION
Welcome to the world of plantation commodities, plantation crops are really
covering the entire world both in terms of production and consumption. The
benefits from the plantation commodities are universal. You will be happy to
know that the coffee which is produced by your estate could be consumed any
where in the world. Similarly, the Rubber or Pepper produced in Kerala is in
demand not only in India but throughout the world. This is the reason why it
is significant to develop an international perspective of commodity which is
one interested in.

The uniqueness of plantation crops is that they are all commercial crops. They
are produced in different regions as suited to the crop but are consumed across
the world. Say, coffee is produced in a few countries like Brazil, Columbia,
India and Indonesia but is consumed all over the world as a beverage. Thus in
the producing countries coffee is a crop of vital importance as a revenue earner.
Producers of plalltation crops thus are essentially dependent on both
international and domestic ~narkets.Sincere countries produce crops at different 67
Principles of Plantation points of time as per the natural geographical region to ensure smooth flow of
Management
production to the market to avoid price fluctuations. Knowing these
characteristics, even the importing countries will have their demand stretched
over time to avoid unnecessary price increases due to sudden demand. Here
comes the need for an understanding among market players both producers
and buyers, to ensure a smooth market mechanism. This is achieved through
formations of Industry Associations or Cartels and the like to strengthen their
market position. TAUSthe need for international commodity trade agreements
and organizations arises to ensure smooth working of such agreements among
member countries. A prominent case in the point is that of OPEC (Organization
for Petroleum Exporting Countries). In economics, it is called a Cartel. The
OPEC group decides what should be production and at what price to be charged
for. There are over time, many international trade agreements in various
commodities from time to time. The effective implementation of such trade
agreements is overseen by the international trade organizations. Some
organizations also take care of production and marketing problems encountered
by the industry from time to time by sponsoring research in the member
countries. Other important activities are conducting of international seminars,
market exhibitions and dialogue with UN Agencies and Regional Trade
cooperation agencies.

Findings of a World Bank project of 1995 indicate a strong support for

International Commodity Agreements. They are given below:'

International Commodity Agreements (ICAs)fit uneasily in a world in which

markets are becoming globalized and increasingly competitive. Development
policy - both as preached by international agencies and as practiced b y
typically democratically elected and non-socialist governments irz the major
producing countries - emphasizes productive eficiency, product quality, and
eflective marketing.

This is a long wayfiom the ideology that gave central place to supply restrictions
operating through central marketing boards and quota allocations.

In today's less centralized, more competitive world, the winners and losers
from commodity stabilization are more evenly distributed across producing
and consuming countries. Commodity policy is no longer a matter of
redistribution from consumers to producers.

This institutional change has been reinforced by the widespread belief -

evidenced, for example, by the collapse of the international tin and coffee
agreements - that commodity market stabilization through international
agreements cannot succeed.

In earlier decades, the belief that stabilization could and would improve the
position of commodity producers provided the impetus for resolving some of
the problems that intervention threw up. Since the collapse of the tin markets
in 198.5, the belief that commodity market stabilization cannot work has
undermined producers'willingness to try to resolve dificulties within existing
ICAs reinforced the suspicion of consumers governments that these a preements
were in non one 's interests.

' Policy research paper 1545,World Bank, 1995

 In the current climate, encouraging competitive markets, state interventions International Commodity
Agreements and
are seen as requiring clearjustzjicationin terms of marketfailure. The existence Organizations
of activefitures markets in all of the industries that have commodity agreements
makes justzfication along these lines problematic.

But the "commodity problem" has not disappeared, and producers may look
for other mechanisms to raise prices from often very low levels in industries
experiencing excess capacity. Development country governments may beforced
to decide whether they prefer to see markets controlled by producer cartels
(where they will lack representation) or under the auspices of international
commodity agreements.

Source: The World Bank, International Economics Department, Commodity Policy and
analysis Unit, November 1995
.
Some of the international organizations which play an important role in
promotion of the concerned industries are given below:
Association of Natural Rubber Producing Countries
International Cocoa Organization
International Coffee Organization
International Rubber Study Group
Common Fund for Commodities
International Spices Research Group
This is only an illustrative list. These organizations from time to time, frame
the relevant trade agreements between the producing countries and the
importing countries and other relevant agencies. It is to be understood that the
countries with different economic backgrounds, specific plantation crops, be
it Coffee, Rubber, Tea or Spice crops, may have different role to play in the
economy to which they belong. Hence, the importance and criticality will
influence the way a country may look at the prospects of an industry.
r
We now study in detail about the international agencies and underlying
agreements of Coffee, Tea, Rubber and Spices which are the plantation crops
covered unit.

8.2 COFFEE: INTERNATIONAL COFFEE

ORGANISATION '

The lntemational Coffee Organisation (ICO) is the main intergovernmental

organization for coffee, bringing together producing and consuming countries
to tackle the challenges facing the world coffee sector through international
cooperation. It makes a practical contribution to the world coffee economy
and to improving standards of living in developing countries by enabling
government representatives to exchange views and coordinate coffee policies
and priorities at regular high level meetings for:
improving coffee quality through the coffee quality improvement
programme and specific projects,
increasing world coffee consumption through innovative market
development activities,
Principles of Plantation initiating coffee development projects to improve quality and marketing,
Management
encouraging a sustainable world coffee economy,
working closely with the private sector through a 16 strong Private Sector
Consultative Board which tackles issues such as food safety,
providing objective and comprehensive information on the world coffee
market, and
ensuring transparency in the coffee market through statistics.
The ICO was set up in London in 1963 under the auspices of the United Nations
because of the great economic importance of coffee. It has administered six
International Coffee Agreements (ICAs), the most recent of which entered
into force provisionally on 1 October 2001 and definitively on 17 May 2005.
Its 77 Members include 45 coffee exporting and 32 importing countries, and it
functions through the International Coffee Council, the Executive Board, the
Private Sector Consultative Board, the Executive Director and a small
Secretariat.

Coffee is one of the world's largest traded commodities produced in more than
60 countries, providing a livelihood for some 25 million coffee fanning families
around the world. Many of these countries are heavily dependent on coffee,
which can account for over 75 per cent of their total export earnings. Among
consumers coffee is a universally popular drink, with over US$70 billion in
retail sales a year. ICO exporting Members account for over 97 per cent of
world coffee production and its importing Members are responsible for around
80 per cent of world coffee consumption.
International Coffee Agreement 2007
The International Coffee Agreement 2007, the seventh Agreement since 1962,
was agreed by the 77 Members of the Inteniational Coffee Council, meeting
in London on 28 September 2007. It was formally adopted by the Council
. through Resolution 43 1. The Agreement will strengthen the ICO's role as a
forum for intergovernmentalconsultations,facilitate international trade through
increased transparency and access to relevant information, and promote a
sustainable coffee economy for the benefit of all stakeholders and particularly
of small-scale farmers in coffee producing countries.

The new Agreement is an important instrument for development cooperation

and will provide the legal framework for core activities undertaken by the
Organization in the future. Around 15 of the ICO's 45 exporting Members are
least-developed countries (with low incomes and high economic vulnerability),
and the 25 million small coffee farmers and their families who produce 90%
of the world's coffee are particularly affected by fluctuations in market prices
and imbalances in supply and demand. The Preamble specifically
acknowledges the contribution of a sustainable coffee sector to the achievement
of internationally agreed developnlent goals, including the Millennium
Development Goals, particularly with respect to poverty eradication.

Important innovations include a new Chapter on the development and funding

of coffee development projects, and the establishment of a Consultative Forum
on Coffee Sector Finance, responding to the need for increased access to
information on topics related to finance and risk management in the coffee
sector, with particular emphasis on the needs of small and medium scale International Commodity
Agreements and
producers. The range of statistical data will be expanded enhancing market Organizations
transparency and a new Promotion and Market Development Committee will
oversee activities including information campaigns, research, capacity building
and studies related to coffee production and consumption.
Source: http/Avww.ico.org
Coffee Board of India
The Coffee Board of India setup by the Government of India plays a leading
role for the overall development of the Indian Coffee industry. We studied the
details about Coffee Board in the previous unit. You can also see the website:
http//www.indiacoffee.org for more information.
Q) Cheek Your Progress 1
Note: a) Use the space below for writing your answers.
b) Compare your answers with those given at the end of the unit.
1) What is the need for international trade agreements and international
organizations for plantation crops?

2) Which are the International Organizations for plantation crops?

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3) What is ICO? When is it established?
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4) Where is ICO located? What are its activities?

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Principles of Plantation
---------------------------
Management 5) What are the programmes launched by International Coffee Agreement
2007?
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8.3 PEPPER: INTERNATIONAL PEPPER

COMMUNITY
The International Pepper Community is an intergovernmental organization of
pepper producing countries. The Community now includes Brazil, India,
Indonesia, Malaysia, Sri Lanka and Vietnam as full members and Hainan
Province (People's Republic of China) and Papua New Guinea as associate
members. The IPC was established in 1972 under the auspices of the United
Nations Economic and Social Commission for Asia and the Pacific (UN-
ESCAP). The IPC Secretariat is located in Jakarta, Indonesia and is headed by
an Executive Director.

Membership to the Community is open to all pepper producing countries, on

the unanimous consent of the existing members and by accession to the
Agreement Establishing the Pepper Community. Representatives of member
countries hold the office of Chairman. Each Chairman holds office for one
year. The Community carries out its functions through its Secretariat based in
Jakarta, Indonesia. The IPC Secretariat is hosted by the Government of
Indonesia and is headed by the Executive Director appointed for a stipulated
period at a Session of the Community. In executing its function the IPC
Secretariat coordinates with member countries through a network of Liaison
Officers who are responsible for the development of the pepper industry and
national focal points which are dealing with pepper in their respective countries.

The International Pepper Community maintains close contacts with the United
Nations organization and its special agencies. In carrying out its functions
smoothly and effectively, the Community consults and seeks assistance from
these experts.
Objectives and functions
The functions of the Community are to promote, co-ordinate and harmonize
all activities relating to the pepper economy with a view to achieving the
following broad objectives:
co-ordinate and stimulate research on technical and economic aspects of
production, including research on diseases affecting the pepper plant,
research on development of disease-resistant and high-yielding varieties;

facilitate the exchange of information on programmes and policies and

on any other aspects relating to production;
 develop programmes for increasing consumption in traditional and new ~nternationa~
commodity
markets, including programmes of co-operation in promotion activities; Agreements and
Organizations
intensify and co-ordinate research on new uses of pepper;
further joint action for the relaxation of tariff and non-tariff barriers and
for the removal of other obstacles to trade;
co-ordinate standard of quality so as to facilitate international marketing;
keep under constant review developments relating to supply, demand
and prices of pepper;
carry out investigations into the causes and consequences of fluctuations
in the price of pepper and suggest appropriate solutions;
improve statistical and other information on pepper production,
consumption, trade and prices including techniques of production and
consumption forecasting;
undertake such other activities and functions as may be deemed desirable
in the interests of the world pepper economy.
Source: http://www.ipcnet.org

Spices Board
Spices Board of India is setup by the Government of India to take care of the
needs of all the stakeholders for all spice crops like pepper. In the previous
unit, we have discussed the Spices Board in detail. You can visit the website:
httpll www.indianspices.org for more detail.
1@ Check Your Progress 2
I Note: a) Use the space below for writing your answers. I
b) Compare your answers with those given at the end of the unit. I
I 1) What is the organizational constitution of International Pepper
Community?

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2) What are IPC's objectives and functions?
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Principles of Plantation
Management 1 3) What is the role played by the Indian Spices Board for the promotion I
I of Spices.

RUBBER: INTERNATIONAL RUBBER

STUDY GROUP
The International Rubber Study Group (IRSG) is an intergovernmental
organization recognized as an international body located in London, formally
established by a Headquarters Agreement with the Government of the United
Kingdom and Northern Ireland.

Mission statement
The International Rubber Study Group (IRSG) was established in 1944 as the
only intergovernmental organization that brought the world's rubber producing
and consuming stakeholders together. The IRSG shall be THE FORUM for
the discussion of matters affecting the supply and demand for natural as well
as synthetic rubber. The IRSG will be the authoritative source of statistical
data and analysis for all aspects of the rubber industry including production,
consumption and trade in rubber as well as rubber products. The seminal
purpose of the secretariat is to prepare current estimates and analyze future
supply and demand trends while undertaking statistical and economic studies
on specific aspects of the industry so as to continually improve its value-added
service to stakeholders.

Membership
Membership of the IRSG is open to governments and industry. Currently 18
countries and the European Community are contributing members: Belgium,
Republic of Cameroon, Cote d'Ivoire, France, Germany, India, Italy, Japan,
Malaysia, Nigeria, Russian Federation, Singapore, Spain, Sri Lanka, Thailand,
United Kingdom and United States of America. Organizations involved or
interested in the rubber industry can become member of the Panel of Associates
(PoA), as described on a separate page. Members of the PoA are also entitled
to become member of the Industry Advisory Panel, which advises on the work
programme of the IRSG Secretariat.

Industry advisory panel

The Industry Advisory Panel (IAP) was established to advise the Study Group
on subjects for study and to assist the Secretariat in carrying out its work
programme. Its members represent all aspects of the world customer industry,
commerce, research and technology and academia. Meeting several times a
year, informal contact is maintained by the Secretariat throughout the year.
 Economic Committee International Commodity
Agreements and
The function of the Economic Committee is to monitor and review the economic Organizations
and techno-economic items on the Secretariat Work Programme, and to make
recommendations to the Group conceming the initiation, continuation and
publication of papers. The Committee meets at every Assembly or Group
Meeting. Membership consists of Member Governments and their advisors
and is assisted by the Industry Advisory Panel.

Statistical Committee
The Statistical Committee is a standing committee which meets once per year
r in line with the Annual Group Meetings or Assemblies. The purpose of the
committee is to review and evaluate the IRSG's statistical output. Membership
b of the Statistical Committee is open to all members of the IRSG, including
Member Governments, Panel of Associate Members, other industry participants
and statistical experts.

Secretariat
The Group is served by a small Secretariat, with the Secretary-General who is
responsible to the Executive Committee and the Group, as its Executive Head.
The Group's activities are financed mainly by contributions from Member
Governments according to their relative annual production or consumption of
new rubber.
Source: http// www.rubberstudy.com

Rubber Board
The Rubber Board of India is set up the Government of India to train and turn
the growers around to be successful plantation managers. We have studied this
in detail in previous unit. You can also visit website: http/lwww.rubberboard.org
for further detail. -

@ Check Your Progress 3

Note: a) Use the space below for writing your answer.
b) Compare your answers with those given at the end of the unit.
1) How does the market mechanism take care to ensure a fair price
realization for rubber?
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TEA: INTERNATIONAL TEA COMMITTEE

In the early 1920s, world exports of tea were around 3,10,000 metric tonnes
per annum. Of this, 75 per cent came from British plantations in India and
Principles of Plantation Ceylon and 9 per cent, from Dutch producers in the Netherlands East Indies.
Management
During this time the United Kingdom absorbed 60 per cent of total world tea
exports. However, in the Netherlands East Indies, tea production increased
dramatically and exports from JavdSumatra grew from 35000 tonnes in 1921
to 72000 tonnes at the end of the decade.

In 1929, the British and Dutch producers, fearful of a world surplus and a
subsequent drop in tea prices, agreed to restrict crop and exports on a voluntary
basis. Unfortunately, the agreement was abandoned in 1931 with the British
blaming the Dutch for failing to hold back the sale of smallholder leaf tea and
for not bringing down exports. The British government, in an attempt to
reinforce the position of its producers brought back import duty on tea with a
higher levy placed on tea from outside the Commonwealth. In addition, exports
were increased to markets outside the UK and the public were strongly
encouraged through an advertising campaign to 'Buy British'. However, growth
of production and exports from JavdSumatra continued, the world market
was unable to absorb the additional stocks and supplies causing average prices
of tea in London to fall to nine and a half pence per pound, whilst in Amsterdam,
tea prices were lower still.

An increasing friction between the British and Dutch Tea Associations, and
the prospect of a further decline in the market, prompted further negotiations
to find a solution to the problem. The International Tea Committee (ITC) was
a result of these negotiations and was set up in 1933 by representatives of the
tca growers in India, Ceylon (Sri Lanka) and the Netherlands East Indies
(Indonesia) to administer the Regulation Scheme under the terms of the
International Tea Agreement, concluded on 9th February 1933, with the
approval and support of the Governments of each of the three participating
countries. In addition to its function as administrator of the regulation scheme,
the ITC was to collect and compile statistics and information relating to tea
production, exports, consumption and stocks in the producing countries as
well as in all other countries.

The scheme stayed in place until 31st March 1955 and was not thereafter
renewed, but an agreement was reached between the governments of the
participating countries for the continuance of the International Tea Committee
as a centre for the collection and publication of statistics and other information
relating to tea.

In 1979, full membership of the ITC was extended to include consumer

.countries and subsequently, new categories for Associate and Corporate
members were introduced. In 1986, the ITC became a limited company.

The International Tea Committee has been providing the tea industry with
valuable statistical information for almost 70 years and is supported by many
of the major tea producing and consumer nations in the world and aim to
continue to produce timely, accurate, impartial data and to remain the definitive
source of information for the industry.

Statistical Services
ITC records go back for 70 years. They provide specific tea statistics on a need
basis for a charge. They also provide Monthly tea stats from around the world
at your fingertips. They also publish Tea Reports from time to time for the International Commodity
Agreements and
usage of producing and trading members. Organizations
Source: http// www.inttea.corn

Tea Board of India

Tea Board of India is setup by the Government of India to guide and oversee
the progress of tea industry in India. Unlike other crops Tea is grown in various
areas with diversity; hence the quality differs and respectively commands a
suitable premium. There is a need to rationalize the domestic marketing system.
More details about Tea Board we have studied in Unit 7. You can also see
website: httpll www.teaboardofindia.in for more information.
@ Check Your Progress 4
Note: a) Use the space below for writing your answer.
b) Compare your answer with those given at the end of the unit.
1) What are the services made available to the growers and traders by the
International Tea Committees?
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8.6 COCONUT
There are two international agencies which help in coconut marketing and
development activities.

8.6.1 The Asia and Pacific Coconut Community

This body, initially formed with four member countries, has grown to a
15 member organization now. It conducts the annual technology forum called
COCOTECH focusing on technology transfer and a development agenda, apart
from implementing projects in production, processing, marketing as well as
on information network.

One of the initiatives of the European Economic Community is an organization

called EUROTROP which was created a decade ago with the aim of promoting
development activities in coconut and oil palm.

8.6.2 Coconut Genetic Resources Network

A network called COGENT was formed at the international workshop on
coconut genetic resources held in Indonesia. COGENT, the International
Coconut Genetic Resources Network founded by International Plant Genetic
Resources Institute (IPGRI) is a global network of coconut producing countries
aimed at improving the production and use of coconut and the conservation of
its diversity. As a network, COGENT synergises the efforts of partners to
strengthen coconut conservation and research programmes, and empower
Principles of Plantation communities dependent on coconut for their livelihoods to adopt improved
Management
technologies and diversified production and marketing systems.

Functions of member countries:

nominate a country representative from an organization that is engaged
in coconut research,
commit to support the cost of the representatives' coconut research
activities in the national programme,
commit to exchange andlor provide information on coconut genetic
resources in the country,
commit to participate in germplasm exchange for conservation or multi-
location variety trials subject to mutual agreement with other member
countries and with COGENT and Bioversity, and
commit to participate actively in studying the diversity of coconut
germplasm in the country, and conserve, protect and maintainlenhance
the diversity.
At present, there are 38 member countries across regions of South-East Asia,
South Asia, South Pacific, Africa, Latin America Caribean Islands. Members
from South Asian region comprise of Bangladesh, India, Pakistan, Sri Lanka.
The Central Plantation Crops Research Institute under the Indian Council of
Agricultural Research (ICAR), Kasaragod, Kerala, India is the member
institution in COGENT.
Source: www.cogentnetwork.org

Emerging agenda at the global level

The coconut community is discussing the implementation of a Coconut Global
Programme.
The objectives of such a programme would be :
- to foster the development of improved coconut varieties, the control of
pests and diseases, the development of coconut-based ecosystems, the
improvement of processing techniques, the production of value-added
coconut products, and the study of socio-economic issues affecting the
coconut sector;
- to strengthen and stimulate partnerships among stakeholders of the
coconut community to increase the efficiency and cost-effectiveness of
global coconut research efforts;
- to offer access to information and documentation and disseminateresearch
findings; and
- to provide training opportunities to researchers and technicians to improve
their knowledge and skills.
Coconut Development Board, India
The Coconut Development Board is a statutory body established by the
Government of India under the administrative control of the Ministry of
Agriculture, for the integrated development of coconut cultivation and industry
in the country. The Board is headquartered at Kochi in Kerala State. Detail
about Coconut Development Board is given in previous unit.
visit the website: www.coconutboard.gov.in
 International Commodity
8.7 CASHEW Agreements and
Organizations
India is the largest producer, processor and exporter of Cashew in the world
accounting for over 60 per cent of the global cashew kernel supply. The other
major exporters are Vietnam and Brazil. At present there are no international
organizations in support of cashew as a commodity.

There are many commodities exported from India. Whether a commodity has
an international agreement or an international commodity organization for
facilitating and extending supportive role for nurturing trade, all parties involved
should have an awareness of how the international agreements and commodity
organization facilitzte the trade for their benefits.

8.8 COMMON FUND FOR COMMODITIES

At the international level, there are also some other organizations working
towards the development of plantation crops like the Common Fund for
Commodities. This is an inter-governmental financial institution established
within the framework of the United Nations. The Fund's specific mandate is
to support developing countries that are commodity dependent tofmprove and
diversify commodities production and trade. It has a market development and
poverty alleviation onentation and through a variety of project based initiatives,
the Fund places a high premium on development of commodities-based
economies upon which the producers and exporters depend for their livelihoods.

The Fund currently has a membership of 106 countries. Institutional members

include the European Community (EC), the African Union (AU), East African
Community and the Common Market for Eastern and Southern Africa
(COMESA). The Secretariat is based in Amsterdam, The Netherlands.

Taking into account the experience gained in commodities by the Common

Fund, in particular during its Five-Year Action Plan 1998 to 2002, shall
contribute to reducing the economic imbalance between developed and
developing countries, improving quality and productivity in a sustainable way,
and aiming at predictable conditions in conlmodity trade" .

Check Your Progress 5

ote: a) Use the space below for writing your answer.
b) Compare your answer with those given at the end of the unit.
j What are the objectives a i d goals of Common Fund for Commodities?
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- -
" Fit e yeat a~.tioriplnrlfor Cotnmon Fur:d of Cor~l~wotlities
2005-07, P I .
79
Principles of Plantation
Management a
8.9 LET US SUM UP
International Trade is an integral part of management across plantation crops.
Since the producing countries are different from the consuming countries there
is a scope for various levels of activities. Research, Productions management,
Marketing management and Financial management are integral part of such
businesses. Hence there is need for a clear understanding of international
commodity agreements and International Commodity organizations. In these
liberalized times, the plantations managers need to enrich themselves with the
understanding of international trade agreements and international organizations
running them.

8.10 GLOSSARY
Association of Natural : ANRPC is an inter-governmental organisation,
Rubber Producing formed to promote the overall interest of the
Countries (ANRPC) natural rubber community.
Cartel A group of companies or countries which
collectively attempt to affect market prices
by controlling production and marketing.
Common Fund for It - is an inter-governmental financial
institution
Commodities established within the framework of the
United Nations.
International Coffee It is the main intergovernmental organization
Organization (ICO) for coffee, bringing together producing and
consuming countries to tackle the challenges
facing the world coffee sector through
international cooperation.
International Commodity : An agreement among producing and
Agreements consuming countries to imp13ve the functioning
of the global market for a commodity. It is
administrative, providing information, or
economic, influencing world price, usually
using a buffer stock to stabilize it.
International Rubber It was established i n 1 9 4 4 as the only
Study Group (IRSG) intergovernmental organization that brought
the world's rubber producing and consuming
stakeholders together.
Millenium Development : The MDGs represent a global partnership that
Goals (MDGs) has grown from the commitments and targets
established at the world summits of the 1990s.
Responding to the world's main development
challenges and to the calls of civil society,
the MDGs promote poverty reduction,
education, maternal health, gender equality,
and aim at combating child mortality, AIDS
and other diseases.
 International Commoditv
CHECK YOUR PROGRESS: POSSIBLE ANSWERS Agmmenis and
Organizations
Check Your Progress 1
1) The International Trade Agreemepts and International Organization for
plantations crops are required to understand the market players, both
producers and buyers to ensure an effective market mechanism and smooth
flow of the produce to the market to avoid price fluctuations. This is
achieved through formation of industry associations or cartels and the
like, to strengthen their market position.
2) The following are some of the International Organizations for Plantations
crops:
Association of Natural Rubber Producing Countries
International Cocoa Organization
International Coffee Organization
. International Rubber Study Group
International Spices Research Group
3) The International Coffee Organization (ICO) is the main
intergovernmental organization for coffee, bringing together producing
and consumer countries to tackle the challenges facing the world coffee
sector through international cooperation. It was set up in 1963 under the
auspices of the United Nations.
4) The International Coffee Organization is located in London (U.K.). It
was set up under the auspices of the UN to enabling government
representatives to exchange views and to coordinate coffee policies and
priorities at regular high level meetings.
5) Important innovations of the International CoffeeAgreement 2007 include
a new Chapter on the development and funding of coffee development
projects, and the establishment of a Consultative Forum on Coffee Sector
Finance, responding to the need for increased access to information on
topics related to finance and risk management in the coffee sector, with
particular emphasis on the needs of small and medium scale producers.
Check Your Progress 2
1) The IPC was established in 1972, its Secretariat is located in Jakarta,
Indonesia and is head by an Executive Director. It is open to all pepper
producing countries and each Representative of the Member countries
hold the office of Chairman for one year. In executing its function, the
IPC Secretariatcoordinates with member countries through a network of
Liaison Officers. The Community now includes Brazil, India, Indonesia,
Malaysia, Sri Lanka and Vietnam as full members and Hainan Province
(People's Republic of China) and Papua New Guinea as associate
members.
2) The functions of the community are to promote, co-ordinate and
harmonize all activities relating to pepper economy.
3) The Spices Board was constituted for the promotion of all spices through
support for:
Principles of Plantation a) Technology upgradation.
Management.
b) Quality upgradation
c) Brand promotion
d) Research and product development
Check Your Progress 3
1) Generally the Cash or spot market is the right place where price discovery
is supposed to take place. In case of commodities, since there are a large
number of producers with varying production capacities on the one hand,
and there are equally diversified consumers as procurement agencies on
the other, it is difficult for the cash or spot markets to fulfill the task. The
International commodity organisations help in price dissemination from
important spot as well as forward markets.
The International commodity futures markets help in price discovery as
well as disseminationof price information and the volumes that are being
traded. Commodity boards in consultation with the various players in the
industry and the related government departments and agencies, arrive at
price related decisions as well as support decisions like amending the
export and import limits, announcing a need based subsidy or tariff etc.
The government can also put quantitative restrictions or offer incentives
for international trade. .
Check Your Progress 4
1) In addition to its function as administrator of the regulation scheme, the
ITC helps to collect and compile statistics and information relating to tea
production, exports, consumption and stocks in the producing countries
as well as in all other countries.
Check Your Progress 5
1) The objective of the Common Fund for Commodities is to support
developing countries that are commodity dependent to improve and
diversify commodities, production and trade.
REFERENCES: WEBSITE OF
Association of Natural Rubber Producing Countries
International Cocoa Organization
International Coffee Organization
International Rubber Study Group
International Tropical Timber Organization
Common Fund for Commodities
International Pepper Community.
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NOTES