Starbucks, Nestle among companies vying for market share in China's Yunnan province, which produces almost 99% of China's coffee volume; Yunnan to increase coffee bean output five-fold to 200,000 tons by 2015

Nevin Barich

LOS ANGELES , January 16, 2012 (Industry Intelligence) – Starbucks Corp. and Nestle SA are among companies vying for market share in China’s Yunnan province, which produces almost 99% of China’s coffee volume, Business China reported on Jan. 13.

The Yunnan province is predicted to increase its coffee bean output five-fold, reaching 200,000 tons by 2015.

In November 2010, Starbucks established its first coffee bean farm in Yunnan. In 2011, Starbucks acquired a 51% stake in a local Yunnan coffee producer. Starbucks also announced its intent to own 1,500 Starbucks stores in China by 2015.

A recent economic report on Central China Television (CCTV) said that Nestle is looking to expand its presence in Yunnan.

CCTV also said that the coffee production area in Pu’Er, a city in Yunnan, grew from 426,000 metric units (mu) from 218,000 mu in 2009. The average price of Pu’Er coffee beans has almost doubled in the past few years, reaching RMB 34.5/kilogram (US$5.46/kg), according to CCTV.

The primary source of this article is Business China, Guangzhou, China, on Jan. 13, 2012.

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