Ken Baker: Efforts growing to protect coffee farmers, ecology – The News-Messenger


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Ken Baker, Ph.D.There doesn’t seem to be such a thing as a “typical” year for international trade in coffee. But let’s take a look at the pre-COVID year of 2019 as an example of some of the issues at play — and why we should care.In that year, just under 70% of the world’s production of 9.6 million tons of coffee beans came from just five countries: Brazil (29.6%), Vietnam (18.9%), Colombia (9.3%), Indonesia (7.5%), and Ethiopia (4.4%). According to Businesswire, the global market at the time was worth $102.15 billion, which is expected to grow by over 52% to $155.64 billion by 2026.It’s been estimated that 70-80% of the world’s coffee is produced on about 25 million smallholder farms (typically less than five acres), employing over 125 million farm owners and hired laborers. So how does such strong consumer demand for their product impact their livelihoods?More: Baker: Coffee's benefits outweighed its early bitter tastePerhaps surprisingly, for the majority of these farmers, the retail price at which coffee is sold has precious little to do with their take-home pay. Reuters News Agency reports that producing countries receive less than 10% of retail-level profits from coffee, and individual farmers even less.'C Price' designed to reflect supply and demand The international trade in coffee is based on the “C Price,” essentially the price bulk purchasers of coffee beans can expect to pay producers for a pound of green (not yet roasted) coffee beans. The system was designed to reflect supply and demand issues: When coffee harvests are weak, beans are less abundant and the price per pound rises. When supply is overabundant, the price falls.However, in addition to year-to-year variability in production and consumer demand, the C Price also reflects “futures trading,” where buyers agree to purchase a given amount of coffee at some date in the future at today’s price. That’s not a bad thing in itself, but the process is open to manipulation by hedge fund operators and speculators, resulting in wild fluctuations in price that the smallholding farmer is ill-equipped to weather.Consider: As of Sept. 27, 2021, the C Price for a pound of green coffee beans was $2.04 per pound. But on April 29, 2019 (the year the global retail market topped $102 billion) it was $0.91 per pound. On April 25, 2011 it hit $3.00 per pound, while on Feb. 11, 2002, it dropped to just $0.44 per poundb.Most coffee farmers coffee cannot easily switch crops (or afford crop insurance) for times when the C Price for their product plummets and they are left no choice but to sell their harvest at less than what it cost to produce.Two species of coffee trees dominate the market: Arabica (Coffea arabica) and Robusta (Coffea canephora). The sweeter tasting but finicky Arabica commands about 70% of the market, with the less demanding but more bitter Robusta comprising most of the rest. Both are shrubby trees (commonly trimmed to 5 to 7 feet) that begin producing fruit called cherries three to five years after planting. The coffee “bean” is actually the seed inside the cherry.A typical plant lives 30 to 40 years before needing to be replaced. Since the cherries on a given tree reach peak ripeness at different times, high quality coffee requires repeated hand-harvesting. Arabica does best at temperatures between 64 and 70 degrees, so most of it is grown at 4,300 to 4,900 feet elevation, areas not well-suited to large-scale megafarms.Sun-grown plants grow faster, produce more beansAlthough coffee plants were initially grown under a canopy of forest trees, in the 1970s farmers began clearing away the forest to plant rows of coffee trees in the open sun. Sun-grown plants grow faster than shade-grown plants and yield up to three times as many beans.However they also require significant inputs of fertilizers and pesticides not needed by shade-grown trees, while exposing thin tropical soils to erosion. And deforestation of course results in the massive loss of plant and animal diversity found in healthy tropical ecosystems.A number of organizations have taken up the challenge to provide equitable incomes for coffee farmers while promoting environmentally sustainable agriculture practices. Fairtrade International and Fair Trade USA are best known for certification programs that provide farmers a safety net against market volatility in the form of a minimum price — currently $1.40 a pound ($1.70 for organic) — for their product.Rainforest Alliance and the Smithsonian’s Bird Friendly Certification programs are the most widely recognized efforts in support of sustainable coffee-farming practices, promoting shade-grown coffee, and reducing deforestation.Consumers have shown sustained willingness to pay a higher price for coffees (and other products) that come with one or more certification seals from such groups. As of 2019, fair trade coffees were estimated to represent 27% of the overall market.Both conservative and liberal critics have rightly pointed out important problems with each of these efforts and the results of research on the actual effects of such programs on farmers, hired laborers and the environment are mixed.My personal take-away is that existing certification programs are seriously flawed but improving and paying a premium for certified coffee is a reasonable option for ethically minded consumers.Ken Baker is a retired professor of biology and environmental studies. If you have a natural history topic you would like Dr. Baker to consider for an upcoming column, please email your idea to [email protected]
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