INTERNATIONAL NEGOTIATION

Exporting the coffee from Brazil to France

Instructor: Assoc. Prof. Dr. Nguyen Thuong Lang
Class: International Economic 61A
1st Semester 2021-2022
Hanoi, September 2021
Quitandinha Palace
Congress and
Convention
Center(Brazil)
Brazil National Anthem
France National Anthem
 Host
Lian Kahy
(Lê Quang Huy)
 Brazil

Ronaldinho Gáucho Thiago Silva Camila Pitanga(Nguyễn

(Bùi Đăng Khoa) (Lương Trung Kiên) Khánh Huyền)
Head of delegation Deputy head of delegation Economic expert
 France

Louis Caroline Tristan le Diable Charlote Gasta Pierre de Lagrange

(Bùi Thùy Linh) (Nguyễn Tuấn Kiệt) (Nguyễn Ngọc Lê) (Bùi Quang Linh)
Head of delegation Deputy head of delegation Economic expert 1 Economic expert 2
Overview

Brazil is France's leading partner in Latin

America for cultural, scientific, and
technical cooperation

Brazil: the world's largest coffee producer

France is an important European importer

of green coffee
 We are honored to welcome you in
today's negotiations

We are also very grateful and delighted

that the two countries can reach the
Mr.Ronaldinho relationship they have today
Mrs.Caroline
 We will continue to discuss the issue
of coffee import and export between
the two countries based on the
contract that was drafted last time

Mr.Silva
Mr.Diable
 Brazil grows coffee because the country is
located on the coffee belt

Brazil currently has more than 100 varieties of

coffee (yellow catuai, caturra, bourbon, mundo
novo…)

Mr.Silva
Mr.Diable
Mrs.Caroline Mr.Ronaldinho

Expectation: Reduce the Reply: Hardly acceptable

price of coffee imports by
25%
 For the arabica crop,
the harvest represents a
drop of between 32.4%
and 39.1% respectively
compared to the
previous harvest

Mr.Ronaldinho

We are witnessing a Frosts had affected

year with real low 150,000 to 200,000
production hectares - about 11% of
the country's total arabica
crop area
Mr.Diable

Coffee in Brazil is
higher than many other
places (Vietnam,
Mexico ...) e r
0 2p
5
$2
MT
Mr.Silva

Recent efforts by the Brazilian

government have sought to change
that perception and rebrand Brazil
as a specialty coffee
 An 8.3% decrease in France’s
economy in 2020

As a result, that sector alone lost

193,000 jobs

The impact of COVID-19 on poverty

in France through a surge in the
country’s unemployment rate to 9.1%

Mrs.Gasta
Mrs.Pitanga
 Brazil’s GDP contracted by an estimated
5.3% in 2020

The unemployment rate in the third quarter

was14.6% of the economically active
population

40% of households received assistance to

offset the fall in their income resulting from
10 million job losses

Mrs.Gasta
The operation of modern, regional raw Mrs.Pitanga
material processing lines costs a lot of
money
 France is now in recession after its
economy suffered its worst economic
slowdown since World War II

The death toll in France from the

coronavirus has now exceeded 10,000

Due to the coronavirus outbreak,

demand for coffee has leveled off

The delivery of goods between Brazil and

Mrs.Gasta
France is also extremely difficult Mrs.Pitanga
Mr.Ronaldinho Mrs.Caroline

Offer 1: decrease from 8000 Reply: Hard to agree

USD/MT to 6400USD/MT (20%
reduction)
Mr.Ronaldinho
Mr.Diable

Offer 2: 5000USD/MT and the Reply: Discuss this matter

quantity of coffee to 50 thousand privately
MTs
DISCUSSION TIME
 Decide on 5000 USD/MT and increase the
quantity of coffee to 50 thousand Ton

We will pay 40% before receiving the goods, the

remaining 60% in 1 year

Mr.Silva Mr.Diable
 New option

40% 25% 35%

Mr.Silva Paid within 01 Paid immediately Paid within 12

Mr.Diable
months before the upon receipt of months after delivery
date of delivery payment proof
 Adjust option

35% 20% 45%

Mr.Silva Paid within 01 Paid immediately Paid within 12

months before the upon receipt of months after delivery Mr.Diable
date of delivery payment proof
 L/C Method

Mr.Silva
Mrs.Caroline
 As soon as the goods are loaded onto the ship's
rail, the responsibility for the shipment will be
transferred to your side
FOB shipping point will help you calculate the
total cost immediately

You don’t need to worry about shipping problems,

Mr.Ronaldinho Mr.Lagrange
you just need to place an order
 We can’t control the risks that occur to the shipment

FOB shipping point must cost us a considerable

amount
DPU could be a more suitable option
Mr.Ronaldinho Mr.Lagrange
 When you use DPU, cargo insurance is unavailable

Both of us must take many risks from this

transaction

Offer to use CFR for shipping payments

Mrs.Pitanga Mr.Lagrange
 We still take most of the responsibility during the
transportation process and assume the cost of
insurance which also affects our budget

Demand renegotiation of the price to accept using

CFR Mr.Lagrange
Mrs.Pitanga
 You don’t have to worry about declaring the
shipment to its own insurer

The cargo insurance is also covered by us, so any

risks of the goods are guaranteed
You have a substantial right once you get the
documents of sale and you may still reject the
Mrs.Pitanga Mr.Lagrange
goods on our actual delivery
 We need some minutes to discuss your new offer

Mrs.Pitanga Mr.Diable
DISCUSSION TIME
 WeWe decide
hope to accept
that our your proposal
partnership will be successful

Great! We are pleased with this cooperation

Mr.Ronaldinho
Mr.Diable
Mrs.Caroline
 SUMMARY

Decide on 5000 USD/MT and increase

the quantity of coffee to 50 thousand MTs

Payment method and debt: Use the

irrevocable L/C method
Mr.Kahy

Delivery: using CIF for transporting

THE NEGOTIATION
is finished!