For more than ten years, COPS has effectively managed coffee and cocoa deliveries for the exchange. The NYBOT is now transforming the pioneering COPS process into a modern B2B commodity management system that can serve as an industry standard to automate the manually intensive and costly back office activities currently associated with coffee and cocoa deliveries.
"As a major service provider to the coffee and cocoa industries, the NYBOT is the ideal organization to spearhead the creation of this new electronic platform," said Pat Gambaro, NYBOT's Interim Chief Operating Officer. "The NYBOT's unique position in the industry and its recognized technological capability can turn eCOPS into a vital and cost efficient resource for both industries."
Both the cocoa and the coffee industries represent logistically complex and far-reaching supply chains that require significant numbers of manually processed document presentations. The significance of the NYBOT initiative can be understood by examining industry documentation statistics.
For example, the domestic coffee market generates approximately 60,000 transactions in a year, and the market in cocoa and cocoa products produces about 48,000 transactions. Each coffee transaction involves some 59 document presentations, producing a total of 3,540,000 manually processed documents annually. That number is quadrupled for international trade. The World Trade Organization (WTO) estimates the overall cost of documentation for all international trade to be $420 billion or seven percent of total trade costs. At this seven percent share, the annual cost of shipping documentation for the U.S. coffee market is about $70 million and nearly $280 million for the global market.
According to Paul Fisher, NYBOT's expert consultant for the eCOPS project, "replacing paper documentation with an electronic system could greatly reduce costs and improve efficiency throughout the coffee and cocoa industries. The successful transformation of COPS to e-COPS for coffee and cocoa could then be expanded to other deliverable commodity markets."
Paul Fisher, a veteran international coffee trader, technician and executive, is the former President of Tristao Trading, Inc., a former chairman of the Green Coffee Association (GCA) and a former Director of the National Coffee Association.
The evolution of COPS into eCOPS will initially deal with 11 out of the 15 major documents associated with coffee deliveries, and 9 out of 15 involved with cocoa deliveries. The new eCOPS will handle electronic versions of warehouse receipts, delivery orders, sampling orders, weight notes, invoices, and insurance declarations. Other areas such as bills of lading and customs entry documentation could be added if demand warrants. The system will serve key cocoa and coffee industry segments and related areas such as exporters, importers, roasters, grinders, bankers, insurance companies, ocean carriers, customs brokers, as well as current COPS users including FCMs, warehouses, samplers and weighers.
The New York Board of Trade (NYBOT) is the parent company of the Coffee, Sugar and Cocoa Exchange, Inc. (CSCE) and the New York Cotton Exchange (NYCE). Through its two exchanges and their subsidiaries and divisions, NYBOT offers an expanding range of agricultural, currency and index products.
