How the global coffee glut threatens tropical forests
By Louis Freedberg
As customers at Starbucks and other gourmet java joints happily shell out $2.85 for a cappuccino or $3.20 for a caramel macchiato, millions of coffee workers and growers around the world are struggling to survive.
Thats because the wholesale price of coffee has been in a free fall since 1998. The consequences are potentially disastrous not only for the millions of people who grow and pick the beans, but also for the precious rainforest environments where some of the best coffee is grown.
The record low prices result from a worldwide coffee glut, fueled largely by Vietnams aggressive promotion of coffee production to rebuild its war-shattered economy. Ten years ago, almost no coffee was grown in Vietnam; today, it is the second-largest supplier after Brazil. Move over, Juan Valdez.
To make way for the nearly 1.5 million acres now under cultivation in Vietnam, vast areas of forest were destroyed, mostly in the central highlands. Similar clearing has taken place in Central America and other coffee-growing regions, with often devastating effects on the environment. Lower-quality coffee can be grown more cheaply in full sun, but only with extensive use of pesticides to protect the sensitive plants from a range of diseases.
Most of Vietnams coffee is not the higher-grade arabica bean sold to connoisseurs, but the lower-grade robusta that ends up in instant coffee or in cheap blends sold in supermarkets. But in the complex world coffee market, the price of robusta set by commodity traders in New York and London drags down the price of arabica as wellthis spring, to only 45 cents a pound for arabica, and 18 cents a pound for robusta.
From Kenya to Costa Rica, growers are trying to stay afloat by cutting down on pruning, fertilizing, and other labor-intensive steps necessary to grow high-quality coffee. The alternative is to convert to other crops or abandon their farms altogether. The crisis, says Liam Brody, coffee program coordinator for Oxfam America, brings with it "health issues, hunger issues, and land issues that have been unprecedented in the coffee-growing world."
The coffee market is so vastcoffee is the second most widely traded commodity after oilthat the environmental impact of the oversupply crisis varies enormously. It has even had occasional positive effects: Some growers have stopped using pesticides because they cant afford them. Others are trying to get their coffee certified as organic in order to command a higher price.
But most often the effect is negative, especially in highland regions where some of the best organic coffee used to be grown under the shade canopies of tropical forests. In the mountains of Oaxaca, Mexico, farmers are beginning to cut down the shade cover to make way for subsistence crops like tomatoes and corn. In parts of Peru, coffee plantations have been replaced with pineapple fields, which not only destroy forest habitat but also require heavy pesticide applications.
"As prices drop, more and more people take out their coffee trees," says Jason Anderson of Conservation International, which has been working to preserve the rainforest in Chiapas, Mexico. "If they turn to other crops, or turn to pesticides, the forest eventually wears itself out."
Whats a conscientious coffee drinker to do? Consumers are confronted with a confusing array of labelsFair Trade, ECO-O.K., Bird Friendly, certified organic, shade grown. The most widely known is the distinctive black and white logo of Fair Trade coffee, certified by the nonprofit TransFair USA, which guarantees a fixed price for growers$1.26 a pound for regular arabica coffee and $1.41 a pound for organic. Without such stability, deforestation for greater production or other crops is virtually assured.
Fair Trade, however, is limited to small producers on farms averaging 12 acres who belong to small cooperatives, which excludes many socially conscious coffee roasters and importers. For example, California-based JBR Gourmet Foods roasts 15 million pounds of coffee each year. Pete Rogers, JBRs green-coffee buyer, purchases some Fair Trade coffee, but most comes from larger growers. Yet the company has for years poured money into supporting schools, clinics, housing, and small-scale hydroelectric projects on coffee farms from Zambia to Nicaragua. Rogers has recently signed seven-year contracts paying growers an average of $1.40 a pound, higher than the Fair Trade price, yet his coffee is ineligible for the label.
In addition, Fair Trade accounts for only 8 million of the 2.6 billion pounds of coffee sold in the United States each year. Untouched are coffee giants like Folgers (owned by Procter & Gamble), Maxwell House (Kraft Foods), Sara Lee, and Nestlé. This sector of the market accounts for most of the coffee sold in the United States, and has far more clout than Starbucks and other specialty coffee outlets.
There have been some small victories. Sara Lee recently agreed to supply Fair Trade coffee to Borders Books, university campuses, and other outlets. The San Franciscobased social-justice organization Global Exchange has begun a campaign to get Folgers, the countrys number one coffee seller, to buy Fair Trade coffee. So far, the company has declined to participate, but the campaign provides a way for coffee drinkers to pressure the sector of the market that matters most. (See www.globalexchange.org/economy/coffee.)
The turmoil in the coffee market doesnt just affect the worlds 20 million coffee workers. It also means that coffee drinkers have to work harder to find out more about the coffee they buy: where it comes from, how it is grown, and how much the producer is paid. The payoff for the research is healthier tropical ecosystems, workers who earn a living wage, and, ultimately, a better cup of joe.
Louis Freedberg is a senior correspondent for the San Francisco Chronicle.
For information on Fair Trade coffee and where to buy it, see www.transfairusa.org, or call (510) 663-5260. The Sierra Club is now selling organic, shade-grown, fairly traded coffee under its own brand label. For more information or to order, see www.sacred-grounds.com.