Poor victims of Espresso Nov03

One billion cups of coffee are consumed worldwide every day. After petroleum, coffee is the most heavily traded commodity with growers in 50 countries competing fiercely with each other in a market where quality has improved and prices have plummeted. Over 70% of all coffee beans come from smallholdings of almost 25 million peasants. These farmers face grinding poverty as international markets dictate the price they will earn. They starve whilst we enjoy a wide range of highly priced coffees stylishly presented in luxurious surroundings.

At current market rates, these peasant producers are paid about US$1.20 per kilo of quality beans. This equates to 1% of the price we pay for freshly ground coffee in the shops. Robusta coffee yields more caffeine per cup than Arabica and it takes 42 beans to make an espresso. Prices for a cup of coffee vary from US$1.50 to US$5 in coffee bars and restaurants. Out of this price, only a mere US$0.01 goes to the grower!

With falling world prices and increasing costs of herbicides, pesticides and farm machinery, the coffee farmers are unable to even recover the cost of production. Millions of growers have no experience of any other crop and in many cases diversification is not possible as coffee is the only crop suitable for mountainous terrain, high temperatures and extreme humidity. Therefore, the poor coffee farmers remain trapped in poverty.

During 2002, the World Food Programme, the EU and USAID blamed the coffee crisis for malnutrition and food security issues in Honduras, Guatemala, Ethiopia, Peru and Vietnam. Whilst education is free in some of these countries, farmers cannot afford food, shoes, uniform and books for their children attending school.

The International Coffee Agreement (ICA) guaranteed coffee export prices at levels that gave a reasonable income to growers. Western governments supported such a scheme to minimise social unrest and keep communism at bay in such poor countries. The arrangement was cumbersome, but it worked. However, after the end of the Cold War, the US abandoned the ICA and since then prices have plummeted. Furthermore, world production has increased because Brazil continues to mechanise its farms and Vietnam, a newcomer to this market, has offered land and subsidies to its peasant farmers resulting in it being the second largest world producer of coffee.

What can we do to help these poor coffee farmers? Farmers in northern Nicaragua have taken on an initiative to supply coffee to the fair trade market, securing a guaranteed price significantly higher than the current market price. Fairtrade, supported by western government development ministries, NGOs and others, has become a lifeline for many coffee producers. Globally, almost 200 coffee co-operatives have been established representing over 700,000 farmers. The share of Fairtrade sales in the UK has grown from 5% in 1999 to 12% last year. This is not bad when we consider that the big roasters (Nestlé, Proctor & Gamble, Philip Morris(Kraft), and Sara Lee) spend £40m on advertising in the UK alone and have 70% of the world market between them.

It is encouraging to note that Starbucks and Costa Coffee do offer Fairtrade coffee at their outlets. They have been working with Conservation International to support and encourage sustainable production of high quality coffee. They have also begun to establish direct links with farms and growers’ co-operatives offering them 3 to 5 year contracts. UK supermarkets like Sainsburys, Co-op and Tesco are also stocking Fairtrade coffee.

Whilst Fairtrade alone cannot solve the crisis of the poor coffee farmers, it would be helpful if the public could actively express its concern by choosing to support its products. As the poor farmers seek opportunities to eliminate the middlemen who erode their earnings, this form of action is one way of helping the poorest directly and avoids giving handouts to corrupt governments.

Let us, as coffee drinkers, support the poor coffee growers worldwide by buying their products. We can then wake up each morning and enjoy the smell and taste of our espresso without victims!