Brazil economy and its coffee industry Federative Republic of Brazil Stav Salinas Dvir Kreizman

Some Background  It’s name is after the Brazil tree  Agriculture - ground, vast rain forest and coast-line.  Area - 8,514,877 km^2  Population - 201,032,714  Language - Portuguese

Significant events  Independence from Portugal  1888-slavery ended  Early 20 Th century-coffee replaced sugar as the main export of Brazil  Vergas regime-period of Industrialization and development  Democracy was established in 1946

Brazil Economy  7 th largest economy in the world by nominal GDP ($2.190 trillion) and PPP.  The nominal GDP per capita – 68 th in the world  One of the fastest growing-economies in the world, with an annual growth of 5%  in the upcoming decades Brazil is expected to be one of the five top economies in the world

The world economies prediction by GDP considering: labor force capital accumulation progress in technology

Brazil economical independency  Brazil government had decided to lower her oil dependency in other countries  They manage to do so thanks to oil fields that were found near the coast  Brazil became completely oil-independent in 2007 when a very big oil field was found next to her coast-line.  As a result of the oil discovery and other government regulations Brazil economy became less vulnerable…

Brazil Industry: Big & famous company's Brazilian multinational energy corporation (no.4 in the world!) mining company bank Americas' Beverage Company biggest banking and financial services company In brasil Banco do Brasil steel-maker company largest producer of long steel in the Americas electric utilities company Aircrafts manufacturer

On the other hand…  Corruption & Crime  Mundial?  Brazil is suffering from the global crisis* : Forbes ( ): “In October: Brazil breaks public debt* record”:

On the other hand…  Bloomberg ( ): Brazil Economic Activity Unexpectedly Contracts in September: “ The number today confirms expectations that GDP growth in the third quarter was close to zero or even negative…”  The Economist ( ): Stumbling up the hill: “After a decade of encouraging growth, Brazil's economy has stalled. Without substantial changes to public spending and business relations, the country may lose its momentum”

Brazil’s export distribution

Brazil Agriculture  Brazil was blessed with a great agriculture environment (rain, fruitful-land…)  Half of it’s area is covered with rain-forests  The agriculture is pretty diverse so it can maintain the Brazilian people’s needs almost by itself.  Brazil is an exporter of Tobacco, Cocoa, soya, tropical fruits and more…  Brazil is the biggest producer of sugar cane and coffee in the world!

Coffee?

Brazil by Coffee  The world’s largest producer (for 150 years already).  – supplied 80% of the world's coffee.  Today – supplying 33%.  mainly exported to the US, the world's largest coffee consumer.  Coffee plantations covering some 27,000 km 2  Two main species-Arabica and Robusta.  Grown in 13 out of 26 states in Brazil.

Areas of coffee cultivation Robusta Arabica Both

The coffee production process - 1  Picking the fruits manually/mechanically  Planting and growing the coffee trees

The coffee production process - 2  Washing and separating the mature ones from the other. Peeling off the outer shell and extracting the beans

The coffee production process - 3  Washing the beans in hot water to remove the sticky and sweet layer that surrounds them. Drying process – initially, under the sun for 4 days.

The coffee production process - 4  Breaking the outer shell with a milling machine. Drying process – finally, in large containers using hot air.

The coffee production process - 5  Classified to different grades according to: size, weight, shape, defects.  Packing in bags of 60kg and exporting.

Planting and growing Harvesting Washing separating and pilling Drying Classifying Packing Exporting to coffee companies

Annual average production (60kg bags): 1.Brazil - 45M 2.Vietnam – 20M 3.Indonesia – 10M Brazil responsible for third of the whole world production! (133M 60kg bags per year)

Manufacturing Paradigm Mass-Production – why?  Design – picking the type of beans (limited variety) and planning the final product.  Make – the production process  Sell – exporting the crop to coffee companies throughout the world *Mass-Customization – will take part at the specific destination of the coffee beans.

Forecasts  Though the importance of coffee export for Brazil’s economy has declined in the last 50 years, it still considered an important export.  Brazil is the second largest consumer of coffee and is predicted to surpass the United States in the mid-2010s.  Coffee in Brazil is a national pride – “ Cafezinho”

References The economist: economy International coffee organization: Forbes: public-debt-record/ Bloomberg: unexpectedly-contracts-in-september.html Wikipedia: Brazil economy The world bank Goldman sachs: march%20'07-goldmansachs.pdf Keywords Industrialization Agriculture GDP PPP labor force capital accumulation annual growth natural recourses global crisis public debt free-market production process Annual average production Mass-Production Mass- Customization

Thanks for your listening !