G terest,"' was timely and informative. The purpose of the present article is to provide more information concerning the campaign of price manipulation itself, particularly with regard to the cartel's coordinated buying tactics, its overall approach, and the timing of its moves. Developing countries, which earlier seemed incapable of making the mechanisms and institutions of world trade work to their advantage, succeeded for a time in copying OPEC's example. It is worth noting how they did it.
Central American market participants who were familiar with the details of the manipulation, or who participated in carrying it out, provided an account of the manipulation. Their account is the version that was widely circulated in Central America during 1977-1978.2 It is interesting that the scheme as executed was profitable from the beginning; it was not a losing operation until as late as 1980. In its early manifestation it was quite different from the usual holding actions in which producer groups engage. This distinction is imporlant, and until today has not been shown clearly to American audiences.
In April 1977 world coffee inventories reached their lowest level of the past 50 years. Statistical services do not agree on what the exact level was that month, primarily because the Instituto Brasileiio de Cafe kept secret the data on its own inventory level. Rumors circulated that in the years preceding the 1975 frost, Brazil had condemned and destroyed 10-20 million bags of coffee. That cut into its famous 80-90 million bag peak inventory from 1966. In any event the accepted 'Greenstone, Wayne D. (1981): "The Coffee Cartel: Manipulation in the Public Interest," The Journal of Future Markets, l(1): 3-16. 'During 1976'During -1978 the author was associated with the Central American Institute of Business Administration (INCAE is its Spanish acronym), located in Managua, Nicaragua. The institute's staff and student body wpw drawn from all the Central American republics. Several people there were coffee experts, and many Institute alumni were coffee growers, traders, or exporters. Three in particular were familiar with the activities of the Compania Salvadorena de Cafe, which is one of the organizations accused of having manipulated the market. A fourth person was the Nicaraguan government's representative to the meetings of Panrafe.