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Without planting a single bean, Switzerland dominates the global coffee market, making billions in profits from Brazilian beans. While Brazil leads in production, Switzerland delivers luxury and convenience, selling capsules that cost up to 10 times more than the raw product. An unequal relationship that leaves billions out of reach for Brazil.
While Brazil harvests millions of bags of coffee every year, Switzerland turns these beans into gold.
Without planting a single coffee tree, the European country leads the export of coffee-derived products, generating billions in revenue.
This disparity highlights an economic model in which Brazilian agricultural labor and natural wealth are used to boost Swiss profit margins.
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Market data shows that Switzerland, when buying raw coffee beans from countries like Brazil, processes and sells products with high added value, such as coffee capsules.
This strategy not only ensures exorbitant profits, but also consolidates the country as a leader in a market that moves billions annually.
Brazil: leader in production, but not in profit
Brazil, the world's largest coffee producer, exported around 2,3 million tons of unroasted beans in 2020, according to industry surveys.
These numbers confirm Brazil's global leadership in production, followed by Vietnam, Colombia, Indonesia and Honduras.
In addition, Raw beans account for 83% of the world coffee trade by weight, but only 59% by value.
This difference is a direct reflection of the lack of value added in Brazil. The country specializes in the supply of raw materials, while nations such as Switzerland dominate processing, branding and marketing.
How Switzerland dominates the coffee market
Switzerland is known worldwide for its high-end brands and innovation in the coffee market, especially through products such as Nespresso capsules.
According to Fernanda Iorio, CEO of FCI Consulting Export, encapsulated coffee can cost up to 10 times more than the raw beans exported by Brazil.
This model demonstrates how the value of a product is amplified when it is transformed and marketed under globally recognized brands.
Swiss companies import the best beans, many of them Brazilian, and use advanced industrial processes to produce roasted, ground and encapsulated coffee.
The association with quality and exclusivity allows these companies to charge high prices, guaranteeing significant profit margins.
The “grain belt” and lack of market access
The largest coffee producers are located in the so-called “bean belt”, a region that extends between the tropics of Cancer and Capricorn.
This tropical climate is ideal for growing coffee, but countries in this range face challenges in competing in the global value chain.
The largest exporters of processed coffee, such as Switzerland, Germany and Italy, are outside this belt.
Although they do not have natural conditions for cultivation, they stand out for their industrial infrastructure and expertise in adding value to products.
Brazil's challenges in adding value
Experts point out that Brazil faces significant barriers to replicating the Swiss model. The main challenges include:
- Poor infrastructure: internal transport logistics increases production costs.
- Lack of incentives for industrialization: public policies aimed at the export of raw materials do not favor the development of finished products.
- High tax burden: High taxes reduce the competitiveness of Brazilian industrialized products in the global market.
Despite these difficulties, there are examples of Brazilian companies that are beginning to explore market niches with products such as gourmet coffees and national capsules.
Switzerland: an example of economic strategy
Switzerland is an emblematic case of how adding value can transform a market. With no agricultural land for coffee, the country invested in innovation, branding and technology.
Brands like Nespresso are symbols of this success, making Swiss coffee a global reference.
According to market studies, the export of processed coffee generates billions of dollars annually for Switzerland.
The strategy of focusing on ready-to-consume products, associated with luxury marketing, guarantees the European country a privileged position in the global market.
Reflections on the future of Brazilian coffee
The disparity between Brazil and Switzerland in the coffee market raises important questions. Why doesn't the world's largest producer also dominate the finished products segment?
How can the country position itself more strategically in the global market?
A possible answer lies in the need for public policies that encourage industrialization and investment in technological innovation.
Brazil, with its diversity of flavors and its leadership in production, has the potential to compete for space in the luxury and convenience market.
However, the journey to balancing the economic scales will be long. Meanwhile, Switzerland will continue to earn billions from Brazilian coffee, leaving Brazil to act as a supplier of raw materials.
Will Brazil one day be able to reverse this scenario and achieve the billion-dollar profits that Switzerland obtains from its coffee?
Coffee is one of the best examples of how we are wrong in only exporting “Commodities”, instead of industrializing and adding value to the product. This has been going on for over 2 centuries.