Text: Martin Murillo
Coffee is one of the most widely traded and consumed commodities in the world, which is why I want to talk about the negative socio-environmental impacts of its production in developing countries and guide people to consume it more responsibly.
Due to its high demand and contribution to the global economy, there are two driving forces shaping the sustainable coffee market: climate change and fluctuating prices. According to research conducted by Giono Bianco, climate change threatens the coffee industry in various ways: rising average temperatures, frequent droughts, heat waves, and extreme weather. Thus, both large multinational coffee companies and small producers are at risk of losing substantial amounts of profits and disappearing altogether due to the unabated movement of climate change.
On the other hand, other analyses say socio-economic effects like fluctuation in prices have caused instability in the market, especially for small-scale producers in developing countries. To resolve these issues, international agencies like large coffee companies accompanied by organized local producers have created a market for special kinds of coffee, taking into account the socio-environmental well-being of producers. It is evident that coffee is one of the most widespread products in the world affected by environmental sustainability.This is due to its impact on water, land, and forest resources. Also, coffee as a global product is promoted by large companies that earn substantial profits and have an impact on society and developing economies.
Identifying the problem
Professor Cemal Kafadar echoed Horowitz words by saying, “There is a danger that the history of coffee may lead us astray. The anecdotal, the picturesque, and the unreliable play an enormous part in it.” Those words are “a warning and an invitation” about changes in consumer behavior due to the immense popularity of coffee, from becoming a part of the global history of trade from the sixteenth to nineteenth centuries to causing various socio-political repercussions. Market advisory firm Mordor Intelligence forecast that the global market value of the coffee industry would experience a 5.5 percent annual growth rate from 2018 to 2023, showcasing the significant influence of coffee to date. However, local coffee prices are barely keeping pace with production costs, as farmers face challenges to earn profits, which makes it difficult for them to invest in the long term, discouraging many of them from staying in the industry.
Studies have found that local coffee producers are often discouraged, live in dire socio-economic conditions and are vulnerable to climate-related hazards. More than 80 percent of them live in developing regions like Latin America. Moreover, 70 percent of the coffee producers are smallholders who contribute significantly to the global coffee production but receive a meager amount of benefits. Thus, vulnerability coupled with inflating international prices pressure producers to convert highland forests into coffee plantations.
To better understand this phenomenon, let’s delve into the coffee plantation. To produce coffee in a traditional plantation method, rows of young coffee are usually planted under a canopy of one or more native tree species. However, this system of coffee production is relatively inefficient due to greater vulnerability to insects and diseases. Volatile coffee prices have been worrying, as scholars predicted the collapse of the International Coffee Organization regime in 1989.
During the 1980s, a resilient variant of coffee became popular as it is more resistant to direct sunlight and amenable to mechanical agricultural practices, resistant to diseases, and significantly higher yielding than traditional shade-grown coffee. This agricultural system was named “sun coffee” (caturra variety) and emerged as a popular variety among international organizations, national agricultural agencies, and large-scale producers in the following 20 years, as more areas in the tropics produced it. Before the 2000s, sun coffee would make up about 40 percent of coffee production in Colombia, Central America, and the Caribbean. However, sun coffee systems do not function in a diverse ecosystem and have negative effects on environment-forest reduction, increase erosion, produce chemical run-off (from requisite high levels of pesticide treatments), and promote extended plantations. As a consequence, due to the high environmental impact and costs of this method, academics promoted an emerging alternative to sun coffee, “shade coffee.”
Shade coffee is a variety that requires protection from sunlight by tree canopies. Ideally, these trees are native to the forest and function like patches, preserving biodiversity. Since the 1990s, there have been emerging campaigns involving both conservation and scientific organizations to convince major retailers and consumers of purchasing shade coffee instead of sun coffee as a way of promoting biodiversity. Moreover, shade coffee would facilitate both forest conservation and its fauna, as well as increase revenue. Shade coffee expanded opportunities for certification schemes, first by producers and then by large coffee companies. These certification systems quickly popularized shade coffee among all major international coffee firms and had adopted sustainable initiatives by the 2000s. Today, 40 percent of all coffee produced globally meets one or more certified standards, designed according to “Market-based mechanisms” that try to reduce poverty among coffee farmers and biodiversity loss.
Although some progress has been made, the advancement in shade coffee is now threatening the permanence of tropical forest in the highlands. About 80 percent of coffee producers are smallholders who live in poverty and vulnerable conditions in the tropics.
Can we find a solution?
Because the sustainability of the coffee market is a complex problem, many initiatives are being implemented to resolve the problem by focusing on agroecological systems like shade coffee and organic coffee; as well as ecosystem services, including carbon sequestration, watershed protection, biodiversity benefits, and landscape beauty, climate-based initiatives, and fairtrade initiatives. Yet it remains unclear to what extent the two objectives of environmental conservation and development can be achieved simultaneously, or if the issue of coffee plantation combines ecosystem services and fair trade initiatives. Thus, despite the collaboration of market-based mechanisms with academic circles, local government, local cooperatives, large coffee brands, and producers, it is not enough to reach socio-economic sustainability.
However, it is possible to reduce the social and economic impact of coffee production on farms by increasing awareness of the unsustainable coffee market. Furthermore, there can be more websites and mobile applications that track Fairtrade and forest-friendly coffees to ensure the origin and genuineness of the initiatives.
I consider that websites help customers understand coffee supply chains more transparently, increasing profit margins and improving the lives of coffee-growing communities. Websites like Bext 360 provide comprehensive and measurable accountability for global supply chains; FAIRTRADE, a global organization that is co-owned by more than 1.8 million farmers and workers who benefit from fairer prices, build stronger communities; and Thank My Farmer uses blockchain data to trace coffee origin and shares this information with QR Codes, making it accessible to consumers on their cell phones.
Meanwhile, the current problems with coffee market sustainability are prolonged global issues; that is just one example of the consequences of the globalization of the market and how it causes vulnerable socio-economic and environmental conditions in developing countries. Issues surrounding the global coffee market demand the proper allocation of time and resources from various production units, large international coffee companies, local smallholders’ farmers, governments, and customers. Currently, we should focus on improving the socio-environmental conditions of coffee growers in vulnerable countries and protecting their land by using better technology and available tools, which will, in turn, lead to the production of high-quality coffee and benefits to consumers.
