Coffee in crisis

>> Oxfam campaigns for a living wage for growers

by PATRICK LEJTENYI

Coffee, one of the world’s most popular commodities, is in big trouble. Not that you’d know it: more people are drinking it than ever before, and urbanite café culture has exploded over the last decade. But for coffee bean growers, the industry has fallen out beneath their feet, and growing the beans is costing them more than they actually make from selling them. So says Oxfam, one of the world’s largest charities, as they kicked off their three-year international campaign for fair commodity trading yesterday with a demonstration at Place-des-Arts.

“The people producing coffee are starving,” says Jean-Yves LeFort, Oxfam Quebec’s campaign coordinator. “We’ve heard lots of stories about how growers are out in the streets, they’re not eating, they’ve had to pull their children out of school, simply because they have no money. Since 1997, the price of coffee has dropped 70 per cent.”

Tell that to your local café owner. While the retail end of the coffee industry is booming, production is in a lamentable state. New technologies for refining beans, Vietnam’s emergence as the world’s second largest coffee producing country, a lack of alternatives for farmers and the collapse of a managed market have resulted in a massive glut in world markets. The price for raw beans has been driven into the dirt.

According to Oxfam’s report, “Mugged: Poverty in your coffee cup,” the price of coffee, once regulated by the International Coffee Agreement, stayed fairly stable at around $1.20 to $1.40 (U.S.) per pound. After 1989, when the United States pulled out of the ICA, the price dropped sharply, with two brief spikes in 1995 and 1997 due to severe frosts in Brazil. The price for a pound of coffee today is around 40 cents, below the cost of production.

“The fact is that the price of retail has not dropped,” says LeFort. “The big four companies, Nestlé, Procter & Gamble, Kraft and Sara Lee, are making huge profits, while the small farmers are paying the price. We can easily drink coffee at a decent price while farmers are paid enough to make a decent living.”

Still, while the coffee industry in particular is in dire straits, it is not only that that Oxfam is campaigning against. Their sights are in fact higher: it’s the entire way commodities are traded worldwide. “But we chose to concentrate on coffee because people can associate with coffee and they are familiar with fair trade. If we chose some mineral, there wouldn’t be as much knowledge around the issue. It’s like the campaign against Nike. People like the shoes, but they don’t like the fact that they’re using child labour. We want to tell people that when you drink coffee, there’s a lot of exploitation.”

Oxfam does have some recommendations on how to right the coffee industry. They want the roaster companies (like Kraft, P&G, Nestlé and Sara Lee) to pay the farmers a decent wage; reduce the supply of coffee on the markets by buying only high-quality beans and destroying some five-million 60-kilogram bags of surplus; create a fund to help farmers switch to alternative crops; and for roaster companies to buy two per cent of their volume under Fair Trade conditions. Anyone interested in supporting the campaign can visit the Web site at www.maketradefair.com. :