UPDATE 2-Guatemala to leave International Coffee Organization, sources say

(Adds comment of coffee body Anacafe, details; paragraphs 7-9)

By Sofia Menchu

GUATEMALA CITY, July 1 (Reuters) – Guatemala has begun the
process of leaving the International Coffee Organization (ICO),
spurred by concern over falling prices of the commodity, a
government official and an industry representative said on
Wednesday.

Coffee, mainly arabica, is one of the top agricultural
exports of the Central American nation, which is grappling with
the economic challenges of the coronavirus crisis.

The Guatemalan official said central American countries were
seeking alternatives to support the coffee industry as global
prices are low.

The ICO said it had not been officially informed of
Guatemala’s plan to withdraw from the international coffee
agreement, but it was aware “some forces in the country” were
dissatisfied with ICO’s handling of the pricing crisis.

“We hope that these rumors will not materialize,” ICO said
in a statement, urging Guatemala to work with other members to
develop a new pact.

It added that it was not able to act as a market regulator.

Ricardo Arenas, head of the board of the directors at
Guatemalan coffee association Anacafe, said the group had urged
the government to cut ties with the ICO as the international
body did not do enough to protect producers’ interests.

“The ICO had lost its way,” Arenas said. “It has needed to
be restructured.”

Many of Guatemala’s small farmers, who make up about 97% of
producers, have sustained losses in the current harvest despite
premiums for the country’s coffee, the U.S. Department of
Agriculture said in a report in May.
(Reporting by Sofia Menchu; Additional reporting by Maytaal
Angel in London;
Writing by Diego Ore and Daina Beth Solomon; Editing by Sandra
Maler and Clarence Fernandez)

© Copyright Thomson Reuters 2020. Click For Restrictions – http://about.reuters.com/fulllegal.asp

Source link

Leave a comment