Coffee Eco-labeling:

Coffee Eco-labeling:
Profit, Prosperity,
& Healthy Nature?
Brian Crespi
Andre Goncalves
Janani Kannan
Alexey Kudryavtsev
Jessica Stern

Presentation Outline
I. Introduction
II.
III.
IV.
• Question at hand
• Background of Coffee and Ecolabeling
Environmental Impacts
Socio-Economic Impacts
• Growers and Consumers
Conclusions
• Future and Alternative Options

Question at Hand
Is eco-labeling of coffee an
effective market incentive
to promote environmentally
friendly production
methods?

Background
• Coffee
–2 nd most traded
commodity in world,
next to oil
– 5.3 million tons
produced globally and
exported in 2002 (U.N.
Food and Agriculture
Organization)
http://www.jeremiahspick.com/organic.shtml

Background
• Eco-labeling
– A strategy to encourage strong
environmental practices through
incentives for the producer
•Price premium
• Competitive advantage
– Appease pressures from environmentalists
• Future considerations (sustainability)
– Future market concerns
– Conservationist outlook

Eco-labeling
• Not a standard process
– Third party certification
• Own criteria for certification under certain
principles for different aspects i.e. organic
• Credibility is key
– Gives consumer advantage
– Schemes of Coffee Labeling
• Fair Trade
• Organic
• Shade Grown

Shade-grown
Fair
trade
Organic

Coffee Certification Schemes
• Schemes are not mutually exclusive
– Many growers are certified organic,
shade grown and fair trade
• Must meet criteria for each, but does not
mean being certified as one means you
are or are not certified by another

Fair Trade
• Seeks to offer small farmers and
cooperatives of farmers a fair
price for their coffee
– Ensures access to credit for farmers
among other mechanisms
• Often coexisting with stated
sustainable growing practices
– Modern plantation farming is not
conducive to small farmers due to
high resource costs and involved
methods
http://gbgm-umc.org/nwo/01so/fairtrade.html

Organic
• Grown free of pesticides, herbicides,
fungicides and other chemicals
– Environmental benefits
• Often coexisting with shade grown
certification
• Most developed current certified
coffee market

Shade Grown
• Grown under a canopy
of trees
– The traditional method of
growth before the
modernization of coffee
agriculture
– Typically yields a highquality
product with a
lesser need for chemical
inputs
– Most often organic also
www.coffeesearch.org/politics/shadegrown.jpg

Environmental Impacts
Traditional
Modernized
Perfecto and Snelling. (1995) “Biodiversity and the transformation of a tropical agroecosystems.”
In: Ecological Applications 5: 1084-1097.

Environmental Impacts
• Loss of biodiversity
• Invasive species
• Soil erosion
• Deforestation
• Agrochemical pollution
• High energy demand
But:
• More yield
• Control over ecosystem
• Cheaper production

Environmental Impacts
Working
landscape?
Working for people:
• Food safety
• Coffee + fruits + timber
• Natural pests control
• Stable yields
…and for nature:
• No habitat lost
• Conserve species
• Carbon sequestration

Socio-Economics
How far does the world-wide
coffee industry extend?

Current trends affecting
growers deal with -
Drive for a better profit, not a
better environment

Flaws in Eco-Labeling for
Growers
“In practice, small farmers need
additional help and incentives to
adopt the [bio-diversity friendly]
certification criteria . . . Small farmers
with [conventional polyculture] farms
need to be presented with strategies
to lower the risk of investment . . .
(Gobbi, 2000).”

Flaws in Eco-Labeling for
Growers
“The entry cost to organic
production, even subsidized,
appears to be too high for the
smallest producers, but organic
production is a significant option
for the slightly larger producers
(Bray et al. 2002).”

Consumers
Pro-Certification Arguments:
Growers cannot get a premium
Big companies cannot be held accountable
unless they have certification
Confidence that the coffee purchased actually
serves the purpose
Ensures good scientific criteria
Helps make an informed decision

Consumers
Arguments Against Certification:
Certification price is too high
Does not control possibility of fraud
Broker should be certified
Deciding between labels becomes difficult

Consumers
Three approaches:
1. Farmers should not bear the burden of
certification costs.
2. “Relationship coffee” - trading coffee
through known sources; certifying brokers
3. Good quality would ascertain good
premium like gourmet coffee

Consumers
Figure 2: (National Coffee Association) Percentages of both awareness and total
purchase of eco-labeled coffee increased from 2003 to 2004.

Drawbacks and Failures
1. Inversion of Values
2. Cost of certification schemes
• Difficult without third party support
3. Certification Methodology
neglecting social relations
4. Organic norms and regulations
across different landscapes

Alternative Certification Systems
Origin:
Southern and Northern countries
Reasons:
• certification costs
• paradigm for ensuring credibility
• more adapted system to local realities
Definition:
A process which generates credibility for the organic
product based on the participation and integration of all
stakeholders who have interest to guarantee the quality of
the product. (Meirelles 2003)

Alternative Certification Systems
Characteristics:
• Involve several stakeholders
• Based on negotiated standards
• Trustworthy relationships
• Attempt to integrate social and environmental concerns
Examples:
• Community Support Agriculture
• Farmers Markets
• Box schemes
• Home deliveries
• Popular fairs
International Workshop on Alternative
Certification

One last thing . . .
We created a web site with
Our paper
Our references
Links to websites
Our PowerPoint
presentation