Struggling with understanding how to answer this case study, could someone explain the answers for me. Specifically how to create the graph.
02:06 12?: 6 BOZ_Case_An_unfair_b... @ ). Case B.2 Coffee Crises An unfair bean count?1 The cultivating, processing and retailing of coffee is a big industry. Yet, the late 19905 and early 2000s marked something of a crisis for coffee producers. During this period the world supply of coffee nose relative to demand causing a slump in the price. The graph below shows the trend in the average price of coffee (there are many varieties and prices) between 1996 and 2016. Having reached $1.30 per lb in May 1997 (an imperial pound (lb) is equivalent to 454 grammes). It then fell more or less continuously over the next five years, reaching around $0.44 in 2002: a fall of some 75 per cent. 250 150 145 run 140 135 z 130 a a 5' _ 150 125 g 2' 9. m E 120 g r a, 100 \"5 8" 3 i a 5 c: .1 to 110 05 00 ll . 0 1996 1993 2000 2002 2004 2006 2008 2010 2012 2014 2016 c: to Summer inine starligics [international Coffee Organization) Coffee prices (average of all coffees) and output During this period, the supply of coffee increased by around 3.6 per cent a year, outstripping the 1.5 per cent annual increase in demand. The growth in supply was largely caused by new plantings in Vietnam and Brazil. In 2002 world demand was estimated to be around 106 million bags; but production was over 120 million bags with a further 40 million bags held in stock. The effect of the low price on many coffee growers, who are mainly to he found in some of the world's poorest countries, was catastrophic. Many farmers were driven into debt; others left the land and migrated to cities, worsening the often appalling conditions there. Others switched to growing narcotic drugs, such as coca in Vietnam. As we can see from the chart, the price of coffee recovered after 2004, peaking in July 2008 at $1.33 per lb, its highest level since July 1997. In part, this was due to farmers 'o-ovaa diversifying into other crops; in part, it was due to buoyant global demand, with the emergence of new coffee markets, such as China and Russia, and strong demand in coffee producing countries themselves. In 2008. however, a combination of good harvests and a recovery in the coffee prices caused supply to increase substantially. Although demand was still growing in developing countries. the onset of recession in developed countries was halting the growth in demand and. as a result, the world growth in supply outstripped the world growth in demand. By the end of 2003 the price had fallen back to $1.03 per in Coffee prices then soared in 2010. reaching over $2.30 by April 2011 (g). These price rises were largely the result of poor harvests in central America and Vietnam and were then driven further upwards by speculation. But then with world growth stalling, and signs that the 2011/12 crop would be larger, coffee prices started falling again. By the end of 2013 prices were at a six year low. However. with Brazil. which produces approximately a third of the world's coffee. seeing its worst droughts for a decade. and with a coffee fungus spreading through Central America. coffee prices soared in early 2014. The price rose from $1.01 per lb in November 2013 to 51.7] in April 2014 a 69 per cent increase in just ve months. Conversely. during the latter part of 2015 and into 2016 coffee prices fell as ample rains boosted crops in Brazil, the world's biggest producer and exporter. As favourable weather increases crop yields, pushes down prices and causes currencies in producing countries to decline, so farmers are encouraged to export supplies that fetch dollars in return. The retail price of coffee You might be wondering why the price of a latte or an espresso in your favourite coffee shop did not follow the fall in price received by coffee growers in 201113 and again in 2015. In part this is explained by the fact that, of the price you pay for a cup of coffee. only a very small proportion is accounted for by the coffee beans. The rest pays for the wages of staff. overheads advertising and prots. Fine, but why has the price of coffee tn supermarkets not more closely followed the wholesale price of COW toasters. About a half ,1- .Lr mkuu his ..1- r, ,i- \"a\" :r Lhwrr .. .. it a, , L.\" \"A 444444 \"in\" unis
