The Age [Melbourne] Tuesday 26 December 2000

East Timor looks to coffee

By MARK DODD DILI

East Timor's most important export earner, coffee, has lost up to 35 per cent of its value because of a world glut, but industry experts are confident of a good harvest in the new year.

"Right now, prices for arabica and robusta are low, extremely low and down about 35 per cent compared to average prices over the past several years," said Sam Filiaci, director of the Dili-based National Cooperative Business Association, the biggest player in East Timor's coffee industry.

"There is simply too much coffee on the world market right now."

Mr Filiaci said he was confident of a bumper crop for 2001 and forecast a 10,000-tonne crop of green beans worth about $24million. This compares with 8000 tonnes for this calender year and earnings of $18-22million.

"It looks excellent - we've been checking the flowering and we could get 10,000 tonnes," he said.

He said that if 30 to 40 per cent of the new year's crop was wet-processed, it would attract a premium price. Last year's political violence destroyed about 80 per cent of East Timor's infrastructure, with most of the damage inflicted on major towns and district centres.

Unemployment remains widespread despite special assistance such as the World Bank's Community Employment Program and the World Food Program's Food for Work projects in rural villages.

An unwelcome side-effect has been a population drift into urban centres by rural dwellers looking for work, but few opportunities exist apart from odd jobs in service industries.

One disturbing but common sight around hotels and bars frequented by United Nations and international workers is young children hawking plastic bags of pornographic videos imported from Indonesia.

Until cash starts to flow from Timor Gap gas production, coffee is East Timor's biggest export earner. Up to 40,000 families or 200,000 people - 25 per cent of the population - depend on coffee as their main source of income.

On the world market, East Timor is a tiny player compared with Brazil, Colombia, Kenya and Indonesia. But the tiny territory does occupy a niche market for quality gourmet coffee, especially its high-value, mild-washed arabica.

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