coffee is important!
-Coffee is the world’s second most valuable traded commodity, behind only petroleum.
-There are approximately 25 million farmers and coffee workers in over 50 countries involved in producing coffee around the world.
-Around the globe, the annual consumption of coffee has expanded to 12 billion pounds.
US and coffee
-According to the International Coffee Organization, the US imported 2.72 billion pounds of coffee from September 2001 to September 2002.
-The US primarily purchases coffee from Brazil, Colombia, Mexico, Guatemala, and Vietnam. The U.S. also buys coffee from Indonesia, Costa Rica, Peru, El Salvador, Ecuador, Venezuela, Honduras, Uganda, Thailand, Nicaragua, India, and Papua New Guinea.
-The Specialty Coffee Association of America estimated that there are 10,000 coffee cafes and 2,500 specialty stores selling coffee.
-Over 130 million consumers are coffee drinkers in the US.
Coffee Prices
-Coffee prices are set according to the NY “C” Contract market.
-The price of coffee fluctuates wildly, generally hovering around fifty cents per pound.
-The single most influential factor in world coffee prices is the weather in Brazil. Droughts and frosts create shortages of coffee and the price increases.
-Specialty coffee is often imported at a negotiated price over the C market, which is considered a ‘quality premium’.
-Most of those premiums never reach the coffee farmer, but rather stay in the hands of the exporter.
-This creates a disincentive for the farmer
Coyotes
-Most small farmers sell directly to middlemen exporters who are commonly referred to as coyotes.
-These coyotes are known to take advantage of small farmers, paying them below market price for their harvests and keeping a high percentage for themselves.
-In contrast, large coffee estate owners usually process and export their own harvests that are sold at the prices set by the New York Coffee Exchange. However, extremely low wages ($2-3/day) and poor working conditions for farm workers characterize coffee plantation jobs.
Roasters
-There are approximately 1200 roasters in the US today.
-Large roasters usually have one blend of recipes and sell to large retailers – the Big Three (Kraft, which owns Maxwell House and Sanka, owned by Philip Morris; Procter & Gamble, which owns Folgers and Millstone; and Nestle) maintain over 60% of total green bean volume.
-Microroasters who roast up to 500 bags of coffee a year offer the product we know as specialty coffee.
-Most roasters buy coffee from importers in small, frequent purchases. Roasters have the highest profit margin in the value chain, making them an important link in the commodity chain
Retailers
-Retailers usually purchase packaged coffee from roasters, although an increasing number of retailers are also roasting their own beans.
-The Specialty Coffee Association of America estimated that there are 10,000 cafes and 2,500 specialty stores selling coffee.
-Supermarkets and traditional retail chains are the primary channel for both specialty coffee and non-specialty coffee, and they hold about 60% of market share of total coffee sales.
Farmers
-Coffee is produced both on large plantations and by small farmers.
-Typically, Fair Trade farmers cultivate less than 3 hectares of coffee and harvest 1,000-3,000 pounds of unroasted coffee a year.
-Small farmers are defined as farmers who rely principally on their own families’ labor.
-Many coffee farmers receive prices for their harvest that can be less than the costs of production, forcing them into a cycle of poverty and debt. They are often forced to sell to middlemen who pay them half the market price, generally between $.30-.50 per pound. Family farmers usually bring in a cash income of $500-$1,000 a year for their coffee.
Laborers
-Conditions for coffee workers on large plantations varies widely, but most are paid the equivalent to sweatshop wages and toil under abysmal working conditions.
-In Guatemala, coffee pickers have to pick a 100-pound quota in order to get the minimum wage of less than $3/day.
-A recent study of plantations in Guatemala showed that over half of all coffee pickers don’t receive the minimum wage, in violation of Guatemalan labor laws. Workers interviewed in the study were also subject to forced overtime without compensation, and most often did not receive their legally-mandated employee benefits. The total average income reported was Quetzales 1006 ($127.37/month).
-According to 1998 data published by Guatemala’s National Institute of Statistics, the cost of the Basic Food Basket for a family of five was 1353.86 Quetzales per month ($171.37 @7.90 exchange rate). The Basket of Goods and Services (including food, education, healthcare, clothing, and transportation) was Q2470.55 ($312.72)
-Because of this situation, many coffee workers bring their children to help them in the fields in order to pick the daily quota.
-These child workers are not officially employed and therefore not subject to labor protections.
-While children in most rural families work at an earlier age than urban children, a February 4 investigative report by ABC-affiliate in San Francisco revealed children as young as 6 or 8 years old at work in the fields.
-The best way to prevent child labor in the fields is to pay legitimate adult workers a living wage.
-Working conditions on these plantations are harsh; as migrant farm workers, many workers sleep in temporary shelters with rows of bunk beds.
-Many times they cook, wash and bathe from the same water source.
-The study of coffee plantations in Guatemala revealed that only 13% of coffee workers have completed their primary education.
-Most were not provided with legally-mandated adequate health care.
-Most coffee workers, like many agricultural workers around the world, are not guaranteed basic labor rights.
-The rural nature of farm work makes them especially vulnerable to threats and coercion, as plantation owners can take advantage of their control over the workforce to keep them from organizing into unions to demand their rights.
-Many countries have adequate labor laws such as minimum wage, mandated health and safety requirements, and freedom to form a union, but these rights are usually not enforced.
Cooperatives
-They are a wonderful alternative.
–“Equal Exchange is much more to us than just a buyer of our coffee. We see you as a partner who treats farmers as equals. You share our commitment to growers and to the land, and are helping us to create a better future.” Pedro Haslam, General Manager CECOCAFEN Cooperative, Nicaragua
Also- consider purchasing organic shade grown coffee!
Black Gold- a documentary in eight parts: http://www.dailymotion.com/relevance/search/black+gold+coffee
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