Cost of coffee.indd - RISC

association) estimate that there are more than 12,000 forced sales, repossessions and bank
auctions now happening. The UN organization ECLAC says there are 15,000 coffee producers
in El Salvador – meaning that more than 80% are now facing collapse. The coffee industry
accounts for 10% of all the country’s exports and more than 160,000 people depend on it for
their livelihoods.
Several coffee-growing countries such as Honduras, El Salvador, Ethiopia and Haiti have tried
introducing different rules and laws in the past year to protect their producers, but nothing is
stopping the rash of failures and bankruptcies. This is a terrible, downward spiral of crisis and
debt.
“We don’t have even the minimum resources for food, schooling and health. How are we going
to pay for the services of expensive lawyers?” asks Joaquín.
Mario Segura, vice-president of the Honduran coffee association ANACAFE told Oxfam: “during
the last four critical years, many producers have had to struggle between being poor and
miserable just in order to keep their farms, in the hope that better times will come.”
illegal crops
Many coffee farmers are now ripping up their failing crop to sow more lucrative, but illegal,
produce – coca, marijuana, poppy and chat. Oxfam has been looking at the story.
Small-holder coffee farmers with few alternatives are increasingly turning to coca, marijuana,
poppy and the stimulant grown in Africa, chat, rather than persevere with their failing coffee
crops. For Peruvian farmer Pedro Páramo, the argument is simple: “We have to survive. If we
don’t find realistic substitutions to this coffee crisis and get at least the same level of income we
had four years ago, then we will have to find other alternatives – be they legal or not.”
Any chance that the world’s trading nations could have agreed of better ways to encourage
coffee farmers to diversify into other legal crops were dashed last month, following the WTO’s
failure in Cancún to agree on agricultural negotiations. Oxfam has recently heard in high-level
industry meetings the ‘coffee to coca’ issue being voiced with concern.
During the International Coffee Organisation (ICO) meeting this month in Cartagena, Colombia,
the Angolan Ministry of Agriculture’s Josefa Correia Sacko – who is Secretary General of
the Inter-African Coffee Organization (IACO), representing 25 African nations – confirmed
a growing problem in Africa. More and more Ethiopian coffee farmers now growing chat, a
mild stimulant illegal in the US, and last week in Colombia, the Global Alliance on Coffee and
Commodities (GLACC) heard that growers in Peru and Colombia were increasingly replacing
coffee with coca and poppy.
“Poppies are sprouting in many areas where our farmers grow coffee,” Fernando Boza, who
works with speciality farmers in Peru for Seattle’s Best Coffee Company, told the Panos news
agency. “It is a disturbing trend but can be explained by market reality.”
Coffee growers are not suddenly international ‘narco-traffickers’. In reality, the giant
transnational companies that control the global coffee market have failed to solve its worst
crisis in the last 100 years. The price of coffee is now hovering around its lowest point in 30
years, not even covering the cost of poor farmers’ production.
“The coffee price is getting worse and worse, I used to buy coffee at 14 birr a kilo and sell it at
20. Now I am buying it for under 10 birr a kilo and I sell it for 12. This is not enough to cover
the costs of my expenses and transport to Dire Dawa. The big merchants have undermined
the coffee market and if this continues I will stop buying coffee altogether and just buy and sell
chat” says Ethiopian coffee farmer Djibro.
In Peru, the Junta Nacional del Café has proposed a $30m fund to help guarantee coffee as
a sustainable crop, to stop farmers moving into coca. However, coffee remains at around 50
cents per pound,while coca is around $3 a pound and a litre of opium latex up to $1000.
Without more political will to compensate for unsustainable low prices and solutions for the
crisis, Oxfam fears that many more coffee farmers will begin growing raw materials for the
narcotics industry.
source: www.maketradefair.org.uk
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