28 September, 2018

Coffee: Black Gold and the Story of Exploitation

Óscar Ortiz
by Julie Francoeur, Fairtrade Canada

As the second most widely consumed drink in the world, coffee culture has deep roots. With independent cafes popping up on every urban street corner and demand for high-quality beans on the rise, coffee has evolved into a multibillion-dollar industry. Here in Canada, 85% of Canadians aged 18-79 reported drinking coffee in 2017.

But our beloved “black gold” also has a dark story that often remains hidden from the bustle of coffee shops. Three weeks ago, the Arabica coffee price plummeted below $1 USD/lbs for the first time in 12 years, closing at $0.975 USD/lb on August 20, 2018, on the New York ‘C’, a global indicator price for coffee. The ‘C’ has been consistently declining, threatening the already fragile existence of around 25 million farming families worldwide.

Representatives from the coffee sector in Brazil and Colombia, the world’s largest producers of Arabica coffee, released a joint statement decrying the destructive scenario in the world coffee market and affirming the fact that farmers are forced to sell their coffee far below cost.

In addition to rising production costs, climate change and unpredictable weather patterns are reducing the amount of land suitable for quality coffee. Youth are abandoning the family farm, with little interest in following in their parents’ footsteps given the serious challenges they face. The volatility in the coffee world leaves many wondering what the future holds for farmers and the industry.

‘Sustainability' is the mot du jour, with companies feverishly brandishing their coffee with labels and certifications that boast commitment to sustainability. And although many companies do act on sustainability, these activities are wholly negated by commercial practices in the coffee market. The recently released report 'Coffee Barometer' comes to the same conclusion. Of the total value of coffee (around 200 billion dollars in 2015), only 10% stays in the countries of origin.

By paying prices that are too low, the coffee industry is at least partly responsible for human rights issues such as poverty, child labor, poor working conditions as well as environmental damage. In sustainability discussions, talking about a ‘decent price’ is taboo. Industry largely refuses to commit to decent prices for farmers. In Canada, Fairtrade, which is the only certification that requires a minimum price for coffee ($1.40 USD plus a $0.20 social premium/lb), has a market share of just under 5%.

Are we really ok with buying our lattes knowing there is no price security for coffee farmers? We must open our eyes and demand that coffee farmers receive a price that helps cover the sustainable cost of production and not to be held hostage by a fictitious and inherently unfair market price. It is time that coffee brands, supermarkets and the industry take structural responsibility by adjusting their purchasing policy.

Image by Sean Hawkey shows Óscar Ortiz carrying a sack of coffee at the Fairtrade certified Anserma Coop in Caldas, Colombia.