Serving People Serving Coffee Since 2005
Issue link: http://baristamagazine.epubxp.com/i/686001
OUR SUPPLY CHAIN IS AT RISK—that's the bad news. The good news, though, is that each of us is capable of strengthening it. We can do this by being honest about the realities we are confronted with: often undignified and impoverished living or working conditions resulting from a flawed economic model which we see tangible evidence of during origin travels. Coffee at origin is not just the pretty stuff, and we need to open up an honest dialogue with consumers about what we are learning in an effort to evolve so coffee—exceptional coffee—can continue to exist. We cannot leave this for the next generation to deal with—we stand to lose too much and, frankly, too many livelihoods are at risk globally. As an industry, we have spent a lot of time espousing the virtues of the artisanal, craft world of fine coffees and developing a connoisseurship and appreciation for our brew, and this is an effort to celebrate. We have not, however, been honest about the vulnerabilities that thrive within our value chain, and we have not evolved the value of green coffee, our raw material, as much as we have succeeded in getting some consumers to pay up for it in its roasted and brewed forms. We are remiss, however, in not talking about the implications to our ongoing access to the quality-differentiating ingredients we require to achieve specialty ratings in the cup. Recently, in some mainstream publications, we heard about "conditions analogous to modern slavery" being discovered in our supply chain in coffee, and, shockingly, in an origin renowned for its strict labor laws: Brazil. Further, we have newly signed legislation that prohibits farmers using the most egregious labor abuses from importation to the U.S.A. outright (H.R. 644)—coffee from a handful of origins was expressly called out. So, what now? How do we deal with what we are learning, and how do we address these troubling issues with consumers? We are not safe or immune from these accusations in specialty coffee—not by a long shot. We need to seek to understand the desperation we have embedded within our value chain leading to these ongoing dark discoveries and concerns. Coffee is too cheap. Coffee consumers and companies are not being totally honest with one another about the need to change how we buy and sell green and roasted coffee. Some consumers are unaware of the complex supply chains behind their cup of coffee. Others, however, increasingly assume that the retailers and roasters they buy from are ensuring and supporting ethical supply chains. These same people have not yet been told that they will have to pay more for these expectations to be met. After all, why should they assume that responsibility when it is something they believe was addressed well before they purchased their coffee? Instead of guarding profit margins, coffee companies should feel empowered to talk about the darkness they are confronted with within the coffee value chain, how they are addressing it, and the cauldron of conflict between the competing priorities (low retail prices) and expectations (ethical behaviors) of consumers. Company desires to evolve are at odds with financial limitations that result from a presumed need to keep consumer prices down. Unhelpful to our case, mainstream media attempts to enlighten consumers with articles about why specialty coffee is so expensive these days when that shouldn't even be the point. Instead, we should be learning why coffee is too cheap. As they manage their businesses, many coffee companies are complicit in the lack of transparency about the supply challenges we face. I understand this well as a result of many years working for a roasting company. I am familiar with the pressures to maintain profit margins by keeping costs down, and I know how those cost-saving "achievements" are rewarded in the business environment. Our industry imposes presumed limitations about the extent to which we can strengthen the value chain based on conjecture about what consumers will pay. They may be more willing than we give them credit for just to know that their coffee doesn't depend on a system of production that can be likened to slavery. After all, should we underestimate what people will pay to maintain their humanity and the integrity of their daily coffee ritual? Imagine if we could elevate awareness to the extent that coffee drinkers liken buying a mug of coffee to contributing to lifting hardworking families out of abject poverty and toward a sense of confidence in their ability to feed, clothe, and care for their families. Talking to your customers about how you support change could be such a source of brand pride—a true differentiator. The lasting effects of commercialized coffee. The introduction of coffee into scalable agricultural systems took place in geographic areas where colonized economic structures resulted in cheap, exploitable labor. We must now recognize and respond to the true value of this product—coffee—in the present day. What is acceptable and humane has evolved since colonial times. Approaching the conversation from this perspective shows how we became desensitized to less-than-dignified conditions as an industry. We continue to rely on these undignified conditions to ensure low prices. While few business models related to tropical crops have evolved to the extent necessary to guarantee appropriate economic benefit to those who work to produce them, coffee is in a real rut in terms of the economic benefit it represents to value-chain participants lower on the production chain, namely growers. Many reports note that economic opportunity from coffee production has remained stagnant for more than a generation. (See top chart, p.79.) All of this seems particularly distasteful and exploitive when reminded that coffee is a luxury product, not food necessary for life, and we know consumers in some markets are willing to pay handsomely for it. The vast majority of coffee is produced on small farms around the globe. These farms are often of limited means and primitive infrastructure, and are dependent on a web of commercial players (coyotes—the dreaded middlemen, brokers, cooperatives, exporters, etc.) to get their product to market. The fact remains that aggregation and consolidation of smallholder production is a critical step in the preparation of a container of coffee. We have to remember to question how, without an exporter's or importer's service, for example, would coffee from these small farms ever fetch an export price or reach the market at all? Most countries where coffee is grown still require an immense amount of low-wage labor. Some farms estimate that labor contributes up to 70 percent of production costs, making it a big cost category that is difficult to minimize in proportion to overall production costs when the product is undervalued (i.e. paying workers even less is definitely considered). Put simply, too many farms receive insufficient revenue from the coffees they produce to pay workers fairly and contribute to improved conditions and comply with national salary minimums. This leads to pressures from advocacy groups to improve conditions, which come at a cost that farmers alone cannot pay and therefore must be shared by all of the interests along the supply chain. Imagine working for four decades without a pay raise, and in fact, plenty of years when annual earnings were less than the year 77 www.baristamagazine.com