Major

International
Coffee
Agreements
What is International Coffee Agreement?

 The International Coffee Agreement (ICA) is an

international treaty that sets out the ICO
objectives and the basic framework within
which it operates.

 The treaty is agreed to by Member Governments

and lasts for a set period of years.
What is International Coffee Organization?
 The International Coffee Organization is an
intergovernmental organization that brings together major
coffee producing and consuming countries to tackle the
challenges facing the world coffee sector through
international cooperation.

 It administers the International Coffee Agreement and is

dedicated strengthening the global coffee sector and
promoting its expansion in a market-based environment for
the betterment of all participants.

 The objectives of the Agreement reflect the priorities of

Member Governments and are implemented through
policy decisions by the International Coffee Council, and an
annual programme of activities implemented by the
Secretariat.
 The current 2007 ICA entered into force on 2 February 2011
when it was approved by two-thirds of the exporting and
importing signatory governments.

 As of 2013, it has 51 members, of which 44 are exporting

members, and 7 importing (the European Union represents all
its 28 member states).

 According to ICO, its members represent 97% of all coffee

production and 80% of the consumption.
Exporting members 19. Haiti
1. Angola 20. Honduras 38. Togo
2. Benin 21. India 39. Uganda
3. Bolivia 22. Indonesia 40. Vietnam
4. Brazil 41. Yemen
23. Jamaica
5. Burundi 42. Zambia
24. Kenya
43. Zimbabwe
6. Cameroon 25. Liberia
7. Central African Republic 26. Malawi
8. Colombia 27.Mexico
9. Costa Rica 28. Nicaragua
10. Ivory Coast 29. Panama
11. Cuba 30. Papua New Guinea
12. Ecuador 31. Paraguay
13. El Salvador 32. Philippines
14. Ethiopia 33. Rwanda
15. Gabon 34. Sierra Leone
16. Ghana 35. Tanzania
17. Guatemala 36. Thailand
18. Guinea 37. East Timor
 • Austria
• Belgium
Importing members • Bulgaria
• Croatia
• Cyprus
1. Japan • Czech Republic
2. Norway • Denmark
3. Russian Federation • Estonia
• Finland
4. Switzerland
• France
5. Tunisia • Germany
6. United States of • Greece • Malta
America • Hungary • Netherlands
7. European Union: • Ireland • Poland
• Portugal
• Italy
• Romania
• Latvia • Slovakia
• Lithuania • Slovenia
• Luxembourg • Spain
• Sweden
• United Kingdom
 Dates of International Coffee Agreements (ICA)
ICA Entry into Force
1962 Provisional: 1 July 1963
Definitive: 27 December 1963
1968 Provisional: 1 October 1968
Definitive: 30 December 1968
1976 Provisional: 1 October 1976
Definitive: 1 August 1977
1983 Provisional: 1 October 1983
Definitive: 11 September 1985
1994 Provisional: 1 October 1994
Definitive: 19 May 1995
2001 Provisional: 1 October 2001
Definitive: 17 May 2005
2007 Definitive: 2 February 2011
Extensions Expiry
30.09.1968
-
Extended by Resolution 264 from 30.9.73 to 30.9.75 30.09.1976
Extended by Resolution 273 from 30.9.75 to 30.9.76
Extended by Resolution 318 from 1.10.82 to 30.9.83 30.09.1983
Extended by Resolution 347 from 30.9.89 to 30.9.91 30.09.1994
Extended by Resolution 352 from 1.10.91 to 30.9.92
Extended by Resolution 355 from 1.10.92 to 30.9.93
Extended by Resolution 363 from 1.10.93 to 30.9.94
Extended by Resolution 384 from 30.9.99 to 30.9.2001 30.09.2001
Extended by Resolution 432 from 30.9.07 to 30.9.08 01.02.2011
Extended by Resolution 438 from 30.9.08 to 30.9.09
Extended by Resolution 443 from 30.9.09 to 30.9.10
Extended by Resolution 444 from 30.9.10 to 30.9.11
The 2007 Agreement will remain in force for 10 years from 2 February
2011, with the possibility of extension for a further eight years.
 INTERNATIONAL COFFEE AGREEMENTS 1962 AND 1968

 The operation of these Agreements helped prices to remain relatively stable

throughout the years 1963 to 1972, and production and consumption became
more evenly balanced.

 These first two Agreements contributed significantly to strengthening the

economies of the coffee producing countries and the development of
international trade and cooperation.

 Changes in the pattern of supply and demand, resulting in an increase in prices,

led to the collapse of the quota system in 1973, and the 1968 Agreement was
extended with all economic provisions deleted.

 The Organization continued as a centre for collecting and disseminating

information and as a forum for negotiating a new Agreement.
 INTERNATIONAL COFFEE AGREEMENT 1976
 To introduce a number of new provisions to strengthen and improve the functioning of the Organization in
addition to retaining many of the provisions which had proved effective during the previous Agreements.

 One of the principal new features of the 1976 Agreement was that it allowed for the suspension of quotas if
prices were high and their reintroduction if prices became too low. Under this system, quotas were
reintroduced in 1980.

 The experience gained in administering the 1976 Agreement provided a sound basis for negotiating the
fourth Agreement, which entered into force in 1983.

INTERNATIONAL COFFEE AGREEMENT 1983

 The process of negotiating a new Agreement gained new impetus with the fall of prices to record lows
during coffee years 1990/91 and 1991/92, and the Council agreed to a further extension of the Agreement
until 30 September 1993.

 At the same time it decided to establish a Working Group to carry out a wide-ranging review of all proposals
and ideas on future cooperation on coffee matters.

 The main feature of this agreement – To secure Price Stability.

 INTERNATIONAL COFFEE AGREEMENT 1994
This Agreements focussed on the areas of-
A. Providing a forum for discussion at the highest level of matters affecting the world coffee economy.

B. Contributing towards market transparency by compiling and disseminating objective information on the
world coffee market.

C. Establishing a programme of studies on matters relevant to the well-being of the global coffee industry
such as marketing systems and encouragement of consumption.

D. Promoting actions and exchanges to encourage the sustainable management of coffee resources and
processing.

E. Promoting exchanges of views and information between Member Governments and representatives of
the private sector through regular meetings of groups of experts on matters such as issues affecting coffee
markets and research on coffee and health.

Six major projects valued at over US$50 million were approved between 1995 and 2000.
 INTERNATIONAL COFFEE AGREEMENT 2001
The 2001 Agreement included a number of objectives:

 Encouraging Members to develop a sustainable coffee economy.

 Promoting coffee consumption.
 Promoting quality of coffee.
 Providing a forum for the private sector.
 Promoting training and information programmes designed to assist the transfer of technology
relevant to Member countries.
 Analysing and advising on the preparation of projects to the benefit of the world coffee economy.

INTERNATIONAL COFFEE AGREEMENT 2007

The overall objective of the Agreement is to strengthen the global coffee sector and promote its sustainable
expansion in a market-based environment for the betterment of all participants in the sector.
Other new objectives include:
 Encouraging Members to develop appropriate food safety procedures in the coffee sector;
 Encouraging Members to develop strategies to help local communities and small-scale farmers to benefit from
coffee production; and
 Facilitating the availability of information on financial tools and services
 The Agreement recognizes the contribution of a sustainable coffee sector to the achievement of internationally
agreed development goals, including the Millennium Development Goals (MDGs), particularly with respect to
poverty eradication.
Key events in the history of the International Coffee
Agreement:

1963: First ICA comes into force at a time of low prices,

regulating supplies through an export quota system.

1972: Export quotas suspended as prices soar.

1980: Export quotas restored and producers agree in return

to abandon attempts to regulate the market unilaterally.

February 1986: Quotas suspended after a boom caused by

drought losses to Brazil’s crop sends prices soaring above
the ceiling of the ICA’s US$ 1.20–1.40 target range.

October 1987: Quotas reintroduced.

4 July 1989: Indefinite suspension of quotas after the system

breaks down under the pressure of competing demands
from exporters for market shares under the new ICA then
being negotiated. Backed by the United States, Central
American states and Mexico press for a much bigger slice of
the market at the expense of Brazil (which resists this) and
of African producers.
4 September 1989: Colombian President Virgilio Barco writes to United States President
George Bush appealing for help to bring back export quotas under a new ICA and
receives an encouraging response on 19 September.

1 October 1989: ICA extension with its economic clauses suppressed takes effect.

February 1990: President Bush at a Latin American drugs summit in Colombia reaffirms
commitment to a new ICA and a document is released setting out the administration’s
thinking on its possible shape.

December 1991: During talks with Cesar Gaviria (Colombia’s new President) Brazilian
President Fernando Collar de Mello (elected in March 1990), agrees in principle to back
efforts to restore quotas when the local industry – given the lead role in formulating
policy – can agree a common position.

March 1992: Brazil finally gives the go-ahead to the negotiation of a

new ICA with economic clauses.

June 1992: First round of the negotiations.

9 March 1993: Bill Clinton, victor in the November 1992 United States presidential elections,
writes to Gaviria supporting a new ICA, although with no sign of much enthusiasm.

31 March 1993: ICA negotiations collapse during the sixth round with little progress having been
made and each side blaming the other for the impasse.

September 1993: In Brazil 29 countries sign a treaty establishing the ACPC with powers to
regulate supplies and prices. Citing this as a reason, the United States pulls out of the ICO.

September 1994: New ‘administrative’ ICA without economic clauses (drafted in March) enters
into force for five years.

March 1998: First talks open about the possibility of replacing the 1994 ICA.

July 1999: ICA talks break down.

September 1999: 1994 ICA extended for a further two years during which the first of which, it is
agreed, a further attempt will be made to draw up a replacement treaty.

September 2000: Drafting of a new ICA completed.

October 2001: ICA 2001 enters into force for six years. It has no provisions for price regulation.

February 2005: The United States returns to full membership.

January 2006: Negotiations to replace the ICA 2001 begin

September 2007: A new ten year International Coffee Agreement is approved and the 2001 ICA is extended,
initially for one year, to enable ratification procedures to be completed.

September 2010: The 2001 ICA is extended for a fourth year to provide further time for participating countries
to complete their ratification procedures.

September 2010: Japan officially withdraws from the Agreement.

February 2011: The 2007 ICA comes into force after ratification by Brazil.