Coffee Essay ⋆ Environment Essay Examples ⋆ EssayEmpire

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Coffee , coffea sp., is a perennial shrub that has taken on social and ecological significance for several reasons. First, coffee grows in humid, mountain cloud-forest environments of conservation importance. Coffee growing areas are found in tropical zones of over 50 countries located in five continents, generally above 1000 meters for Arabica varieties, less for robusta. The more valuable arabica varieties require areas of high rainfall, typically formed by orographic precipitation and occurring in mountainous zones surrounded by drier lowlands. This results in a geographic dispersion that makes coffee areas important stopovers for long-distance bird migrations and favors high rates of endemic species. Coffee agro-forests often form areas of relatively high quality ecological matrix that surrounds, connects, and supports conservation reserves. For these reasons, coffee-producing areas have become important to international conservation strategies.

Labor-Intensive Crop

From a social standpoint, coffee is a labor-intensive, high-value crop that provides cash income to millions of families the world over, whether as small farmers or wage laborers. Well over 6 million metric tons of coffee are produced each year-approximately one kilo for each person on earth. This remarkable social and economic reach is matched only by the violence of price fluctuations that yearly shake coffee markets and impoverish these same millions of primary product producers. Since the end of the International Coffee Agreement in 1989-a Cold War-inspired global production pact, sponsored by northern consuming countries-coffee producers have become subject to sharply lower real prices and intense price fluctuations. This long-term real price decline was accelerated by a 1990s World Bank initiative to foster robusta production in Vietnam, the success of which placed additional downward pressure on coffee prices. Price stagnation has fostered declines in coffee production and a population exodus from high-cost coffee-producing areas-particularly in Latin America, where production costs (outside of Brazil) are relatively high-and increases in lower-cost production areas in Africa and Asia.

From a commodity-chain standpoint, the global coffee trade links relatively poorer, rural producers in the global south with wealthier First World consumers. The coffee commodity chain is relatively simple; tracing product from fields to cafes and homes is relatively straightforward. Studies of coffee data have demonstrated ways in which primary commodity production serves to enrich every actor in the commodity chain except farmers and wage workers, furthering our understanding of how wealth accumulation and impoverishment are linked, and how this linkage figures in environmental declines. These studies show that coffee producers receive only 6 percent of the price of “cupped” coffee sold in cafes. The vast majority of the profit accrues at the upper reaches of the commodity chain, in the hands of wholesalers and retail venues. Even in terms of coffee in beans, farmers receive only 10-30 percent (the later figure if the coffee is processed on-farm) of the final sales price. Even more troubling is that as consumers have begun to pay higher prices for premium gourmet coffees (since the mid-90s), the farm share of the total price has declined.

This separation between farm prices and final prices becomes even more troubling when considering what goes into producing a top-grade coffee, which is no easy matter. First, the ripe beans need to be selectively picked, thus necessitating multiple passes through the coffee plot. Then the pulp must be delicately removed, and the beans fermented for an exact length of time. Finally the product is dried and sorted: lower quality beans, often a large percentage of the crop, must be set aside to increase the percentage of export-grade product. As the relative return to the farmer declines, her labor increases (research shows that on many family farms, women comprise the bulk of labor inputs). Total labor time per kilo comes to between 2-3 hours for poorer farmers without capital-intensive, labor-saving technology so that, after costs, farmers are likely earning under 50 cents per hour.

Commodity-chain studies also show why the World Bank-financed expansion of robusta coffee production in Vietnam had such a significant impact on arabica coffees grown in highland areas. In an effort to squeeze greater profit out of cupped coffees, cafes have learned to mix arabica and robusta coffees in prepared drinks; robusta varieties, though lacking in flavor and aroma, provide body and have significantly more caffeine than arabica coffees. This provides an extra kick to coffee drinks at a lower price, thus reducing demand for-and the market price of-arabica varieties. The declining real price of coffee has resulted in a changing global geography of coffee production. Production in high-cost (higher wage) countries in Latin America has stagnated, and lower-wage countries in Africa and Asia (e.g., India and Ethiopia) have sharply increased production.

These three factors-conservation, economic marginalization, and clear-cut commodity flows combine to make coffee an important commodity for contemporary grassroots initiatives (fair trade, organic, and biodiversity conservation), governmental programs (both national and international), and action-oriented research activities. Of these, the most important are alternative trade networks (ATOs) grouped under the Fairtrade Labeling Organization (FLO), and under organic and shade-grown coffee labels. The boundary between nongovernment and governmental action is often blurred, since coffee producers form an important constituency of national antipoverty and conservation programs. The aim of these ATO initiatives has been to establish a grassroots market network that guarantees coffee producers a minimum price; this price varies by continent, but has been substantially above world market prices in recent years. Fair-trade coffee, often produced under organic standards, has substantially increased the welfare of the more than half a million farmers who have become fair-trade certified since 2005, promoting both increased family incomes and strengthened local organizations that can provide access to health care, education, financial help, and other benefits.

However, the fair-trade ATO model is under stress due to four factors. First, less than 20 percent of fair-trade certified coffee is sold in fair-trade markets. The expansion of fair-trade production has outstripped demand among fair-trade consumers. This is partly due to coffee quality issues, since consumers will pay high prices for gourmet quality coffee, but primarily it reflects the power of large corporate retailers over food distribution. Second, large corporate entities such as Starbucks, Sainsbury’s, Carrefour, and Utzkapeh have set up their own “responsible” and/or “sustainable” brands in competition with other fair-trade and certified-organic labels. Third, corporate entities working within FLO have offered to purchase fair-trade coffee on the condition that they receive a volume discount (e.g., Nestles); in other words, lowering the price below the present floor. Fourth, neither fair trade nor organic price premiums have increased in nearly ten years, leading to a declining participation and quality level in areas with higher production costs, such as Mexico and Central America. The percentage of final sales price received by fair-trade certified farmers-about $2 per kilo is not much greater than that of noncertified farmers. It takes from 1.3 to over 2 kilos of farm-grade coffee to obtain 1 kilo of export-grade “prima lavado” (prime washed) coffee; thus, the fair-trade plus certified-organic price of approximately $3 per kilo is reduced to around $2.00, even before marketing costs are discounted. With high-quality roasted coffees retailing for at least four times this price, returns to farmers may hover around 30 percent range of conventionally-traded coffees. From this perspective, adoption of fair-trade coffee by mainline retailers such as Wal-Mart may be seen as much a function of low fair-trade prices as a turn toward social responsibility by retail giants.

Coffee and Conservation

With respect to conservation, fair-trade and conservation market initiatives are interlinked-most buyers now require both fair-trade and organic certifications-such that both initiatives are at risk. To expand on the conservation strategy that underlies certified-organic and shade-grown coffees, the goal of both is to establish an organizational structure that promotes decentralized, nonterritorial conservation (conservation work undertaken outside of, and complementing, parks or reserves). Coffee biodiversity initiatives encompass areas of high conservation value. Certified-organic and shade-grown coffee production standards provide a practical regimen of conservation activities (no agrochemicals, soil and water conservation, encouragement of a biodiverse shade tree layer). These initiatives also provide an important technical extension system that includes crop inspectors and conservation workers, who oversee conservation-oriented crop practices to protect these areas, providing a highquality environment that protects and buffers existing areas, and helps to prevent conversion of coffee farms to pastures.

The agricultural “matrix” provided by coffee farms surrounding parks and nature reserves is important for maintaining species diversity. If areas surrounding reserves become incapable of supporting movement of species to and from a particular nature reserve, then species abundance within the reserve will decline due to an inability to maintain intra-specific genetic diversity or replenish in the event of local extinction. Organic coffee, a diverse, multi-layered agro-forest cover, has been found to provide an environment, or matrix, suitable to the propagation of diverse species, such as frogs and birds, by allowing them to move freely through coffee farms from reserve to reserve. This is particularly true when coffee farms are compared against alternatives such as pastures.

Despite these conservation advantages, certified-organic coffee has, like fair-trade coffee, met with recent difficulties. The additional organic premium (currently $15 above the fair-trade price) does not cover production costs in high-cost production areas. In addition, contemporary certification schemes have become both costly and difficult to manage. The layers of inspections and technical extension (village-level and external) required to meet ISO certification standards are quite costly. Small producers, often those living in the areas of particularly high conservation value, find it necessary to join in cooperatives in order to cover certification costs. These village-level organizations reduce individual costs, but must undertake additional work and costs to cover village-level recordkeeping and technical assistance expenses. Aside from cost, these activities require skilled workers who can perform documentation and inspections activities at the village level. In the event of emigration, conservation networks dependent upon these certification schemes are easily disrupted.

Confronting poverty and encouraging conservation practices via alternative trade initiatives is at the crossroads. Given current fair-trade and certified-organic price premiums, high-cost production areas in Latin America are unable to sustain production or coffee quality levels. The cost issue is less pressing in lower-cost production areas in Asia and Africa, yet without higher prices, it will be difficult to sustain village-level conservation organizations necessary to grassroots ATOs.

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