Oddly, soaring coffee prices may hurt peasant growers
JOIN OUR MAILING LIST
Enter Email
CONTRIBUTE TODAY
FOLLOW US ON
FEATURED CAMPAIGN

 Watch the Video

FacebookTwitterGoogle+EmailShare

Kevin G. Hall

September 6, 2011

 

Reporting from Washington — Soaring coffee prices mean good times for peasant growers, but because financial speculation in part is fueling the prices, the high prices eventually could threaten suppliers of organic and other “socially conscious” coffees.

U.S. retail coffee prices have risen more than 20% over the past 12 months and more than 57% in commodity markets. It’s a windfall for growers after nearly a decade of horrible prices.

“We haven’t seen this kind of price in many, many years,” said Linbano Cruz Alvarado, an organic grower who belongs to Union Majomut in Mexico’s mountainous southern state of Chiapas. “We’ve seen high prices, but not this high.”

But for counterintuitive reasons, these prices may be harmful.

Over the last 15 years, there’s been an explosion of specialty growers, whose exports include coffee beans grown without fertilizers and chemicals, and coffee grown in wild-bird sanctuaries. Coffee shops that offer these sorts of specialty coffee beans are now in virtually every large U.S. and European city.

Many specialty growers are in Latin America, where the coffee belt stretches from Mexico to Andean highland countries Peru and Bolivia. In recent decades, small coffee farmers in the Americas organized themselves into cooperatives, aided by U.S. and European nonprofit groups.

The co-op model — sometimes called the Fair Trade model because growers are collective owners who reap the full benefits — allowed farmers to earn above-market prices during down times. They were less vulnerable to the middlemen, called coyotes, who supply big international coffee companies.

Now, however, the coyotes offer better prices than some of the contracts the co-ops entered into previously with foreign buyers. Some farmers are taking the higher offers, leaving the co-ops struggling to get sufficient supplies and at risk of defaulting on contracts.

“The co-ops are an underfinanced population. If they needed $1 million before to buy the harvest of their members, suddenly they need $3 million” to compete with the middlemen and pay current prices, said Rodney North, a spokesman for Massachusetts-based Equal Exchange.

Equal Exchange has imported organic and Fair Trade coffee, grown by worker-owned co-ops, since 1986. North thinks that supply-and-demand fundamentals warrant higher coffee prices, but he fears that financial speculation is driving prices to levels that allow middlemen to undermine the Fair Trade business model.

It’s a concern shared by Santiago Paz Lopez, a co-manager of Co-op NorAndino in the north Peruvian town of Piura.

“A cooperative, its role is much bigger than just buying and selling. It is a rural development organization,” he said, noting that the cooperative’s profits help pay for roads, medical offices, schools and other needs that often aren’t met in developing nations.

His co-op of roughly 7,000 peasant farmers is holding together, but Paz Lopez has heard from others who aren’t faring as well.

“If the cooperatives end up breaking up, we go back to where we were, where the big companies have a large control over price, and they pay producers whatever they want,” he said. “That’s the threat.”

Hall writes for McClatchy.com

http://articles.latimes.com/print/2011/aug/31/business/la-fi-coffee-growers-20110831

 

FacebookTwitterGoogle+EmailShare

Fair Trade is the Pathway to Regenerative Agriculture

Coop Coffee

The movement for a food system that sustains people and planet is been growing. Fair trade offers a model to incorporate fair livelihoods and the true cost of production into regenerative agriculture models that are both new and very old, feeding the world and tending the planet. Written by Ryan Zinn The climate is changing, […]

A Soil-to-Soil Vision for the Fashion Revolution

Paige Green - Fibershed

From origins in Northern California, Fibershed is building a global network of regional regenerative fiber systems. Founder Rebecca Burgess describes her vision for vibrant local fibersheds that connect us to the landscapes that grow what we wear and sustains a new generation of farmers, ranchers, natural dyers and mills. From conventional cotton production, which uses […]

Fair Trade As We Do It: the Story of Jumbo Nuts

Annie Jose sewing rice seeds into her rice paddy

Fair Trade Alliance Kerala, the small-farmer collective I work for, is recapturing the homestead farming traditions of Kerala. Our goal is to grow to about 10,000 farming families stewarding about 40,000 acres of farmland, creating conditions that are akin to a tropical rainforest in crop diversity and biodiversity. For us, biodiversity is a food security […]

Regenetarians Unite!

Regenetarians Unite

As eaters, we have a choice: will our diets restore and replenish the earth, or will they deplete it? An exploration of three key principles that look beyond simple distinctions between omnivore and vegan towards a new Regenetarian ethos. By David Bronner How the Regenerative Agriculture and Animal Welfare Movements Can End Factory Farming, Restore […]

What Does “Regenerative Agriculture” Mean to You?

Women Workin in Fields - Coop Coffees

We asked that question to a handful of leaders, growers and thinkers from around the world. Here are a few of their thoughts. “Regenerative agriculture, based on our Andean experience, is the direct relationship with life. It gives life back to Mother Earth, provides food that connects with every aspect of human beings and their […]

Product Picks

Peace Coffee

We asked our team for some of their current favorite products from companies committed to the principles of fair trade and regenerative organic farming. Find them online or at your favorite natural food store! Imagine an economy that rewarded small-scale producers for their hard work, fed us all healthy food, and clothed us sustainably. While […]

Fair Trade for Farmers and Soil

Plowing field with oxen

Small-scale organic farming and regenerative agricultural practices combat our climate crisis and help feed the world. Here are just a few of the ways that fair trade producers and their brand partners are collaborating to grow ethical supply chains through regenerative organic agricultural methods, and producing goods that we can all feel good about. This […]

The Hidden History Made at Sakuma Brothers Farms

Picking blueberries: Copyright David Bacon

History was made on September 12, 2016 with the election of Familias Unidas por la Justicia to be the union representing berry pickers at Sakuma Brothers Farms in Washington state. Three perspectives on what that means for farmworkers, farmers, and our food system. History was made on September 12, 2016 with the election of Familias […]

Food Waste, Hunger and Climate Change

Food Wastage Footprint and Climate Change, Rome FAQ

As a child, you likely heard some variation of the cliché, “Eat all your food; there are starving people in the world.” While hunger remains one of humanity’s greatest challenges, the underlying causes are not as clear as one might think. Written by Ryan Zinn As a child, you likely heard some variation of the […]

Fair Cannabis?

Trimming

For decades, workers have flocked to Northern California and Southern Oregon to work the fall cannabis harvest. Some are migrants on their seasonal tour. Others are driven by an interest in cannabis culture, or by the promise of lucrative pay. While some “trimmers” have had pleasant, safe and profitable experiences, many have not. Written by […]