The new Expocacer Hub in Lewes, Delaware, is expected to increase sales in the US market by 10%-15%. Photo credit: Expocacer
The Cerrado Coffee Grower’s Cooperative (Expocacer), established in 1993 in Patrocínio/MG, Brazil, has made significant strides in promoting coffee quality and supporting its members through socio-environmental initiatives and contributions to the regional economy. With a robust infrastructure capable of storing over 1 million bags of coffee, Expocacer currently serves 680 producers and exports to more than 30 countries across 5 continents.
In a recent development, Expocacer has opened a logistics hub in the United States, their largest coffee buyer, with the majority of the beans sent being specialty coffee. Ítalo Henrique, Commercial Director of Expocacer, stated, "Our plan is to send one container a month, each with around 320 60-kg bags of coffee. This project aims to boost the economy and consumption of specialty coffee, which is growing increasingly, as well as shortening processes." The hub, located in Lewes, Delaware, is expected to increase sales in the US market by 10% to 15% in the first year, capitalizing on the consistent 12% annual growth rate of Brazilian specialty coffee consumption, as reported by the Brazilian Agricultural Research Corporation (Embrapa).
The decision to expand into the United States was based on a comprehensive business plan that analyzed the potential benefits, risks, and brand projection for the cooperative and its members. The expansion will take place gradually, focusing on validating and consolidating established partnerships while also opening up new clients. The primary purpose of this expansion is to increase the reach of Cerrado specialty coffee in international markets, ultimately leading to increased sales and visibility for the cooperative. Success in three years will be measured by the growth in exports, entrance into new markets, and the establishment of solid partnerships with international importers and distributors.
The expansion makes logistics easier as well, and allows more direct service to buyers. Henrique says, “The opening in Lewes, Delaware, allows it to operate anywhere in the U.S, allowing the cooperative to choose where to operate, without being tied to a single location. It also allows coffee to be sold in any quantity, large or small.”
Vertical integration plays a crucial role in Expocacer's business model, allowing for greater control over the supply chain, from coffee production to final distribution. This integration can lead to increased efficiency, improved product quality, and a competitive advantage in the international market. Furthermore, the expansion helps mitigate risks by diversifying markets and solidifying the cooperative's brand, ultimately making its members more profitable.
The expansion of Expocacer into the United States reflects a larger trend of Latin American businesses venturing into the US market, particularly in the coffee industry. As consumer demand for origin, traceability, and sustainability grows, companies are seeking to get closer to their target markets. Expocacer's move to establish a presence in the United States positions them to better serve their customers and capitalize on the growing demand for specialty coffee.