Managua, Sept 10 - Central American coffee growers ship most of their gourmet beans abroad, but local consumption is rising thanks to campaigns to open more coffee shops and promote home brewing in exporting countries.
In El Salvador, Nicaragua, Honduras and Mexico, coffee consumption has risen in recent years, according to the International Coffee Organization (ICO), as customers flock to U.S.- style coffee bars and drink more at home and work.
Internal sales have not yet slumped on rising prices, which soared to multi-year highs early this year and now hover at around $1.30/lb, say market analysts and roasters.
Nicaragua's upscale coffee chain Cafe Latino raised its prices 25 percent this year without hurting sales, said Cristina Lopez, who supervises the chain's 12 outlets.
"The good customer knows coffee and continues to come in, and I do not see prices affecting that," Lopez said.
The chain has snappy commercials with Latin rhythms advertising flavored coffee drinks with whipped cream and free Internet at its shops.
The trend is a turnaround for the region where instant, low-quality coffee served watered down with lots of sugar has long been the norm.
The ICO said domestic coffee consumption doubled during the 2007/08 growing season in Honduras, one of Central America's poorest countries, hit hard by soaring costs of staple grains.
"This is a product whose presentation is attractive to middle- and upper-class people with more buying power," said Honduran coffee producer and exporter Jose Angel Saavedra.
Coffee prices are not rising as fast as other food and energy prices, which helps brewers retain the new consumers, said Carlos Brando, the International Coffee Organization's lead advisor on boosting consumption in producer countries.
"No one is noticing coffee going up because if you look at all the commodities, coffee is the one that has risen the least," Brando said.
SLIPPAGE IN COSTA RICA
The region's per capita coffee consumption remains much lower than in traditional markets like the United States and Europe. Nicaraguans drink 4.4 lbs (2 kgs) of coffee per year on average compared to over 22 lbs per year in Scandinavian countries.
If coffee prices keep rising, some say progress made in internal consumption could backslide.
As coffee-growing countries drink more at home, global supplies could tighten, forcing prices up.
In Vietnam, the world's No. 2 coffee producer, the government plans to double domestic consumption over the next seven years while keeping coffee output steady. Indian coffee prices are rising as drinking coffee catches on.
A dip in local coffee sales is already happening in Costa Rica, traditionally Central America's strongest consumer.
Sales of coffee to domestic Costa Rican roasters fell 9.7 percent in 2006/07 from the previous year, says the country's coffee institute.
ICO officials have scheduled emergency talks over the next two months to identify why Costa Rican consumption has fallen.