I've decided to switch things up a bit this week. This ain't my normal sunshine and puppies blog post. I'd like to talk a bit about bad coffee. Yep folks, it's time to discuss the commodity coffee trade. What's commodity coffee, you ask? Why it's that can of pre-ground coffee on your shelf, be it M**w**l House, F***ers, or many other varieties. You don't know where it came from, but you do brew something resembling coffee with it in the morning. Let me give you a better definition: commodity coffee is an undifferentiated blend of coffee from several producing countries purchased from an importer and sold on the commodities market. I'm not going to tell you that it doesn't taste good. You know that already. Wait, I am going to tell you. It tastes terrible, and it has to be brewed very weakly to even be palatable. What you may not know is where this coffee comes from and the negative effects it has on people along the way.
Now I know right now you're thinking to yourself: "A large corporation owned by an even larger conglomerate having unscrupulous business practices? Never!" Well, it's true folks. While it may or may not sway you from buying commodity coffee, I really want you to know how these businesses operate, and ultimately the oppression that goes into making a cup of commodity coffee.
Of course you know that commodity coffee is cheap. It's unbelievably cheap. You may ask "Why should I pay $10-$15 a pound when I can buy a three pound can of Folgers for $7?" I hope by the end of this article, that sentence will sound more to you like "Why should I give millions of coffee farmers the ability to do things like feed their families and send their children to school when I can save some money on something I barely enjoy and use merely as a drug?" or "Why shouldn't I exploit millions of people and push them to grow illegal drugs or illegally seek entry into my country just to survive when I can drink a cup of coffee that tastes like sewage?" I'd like to also convince you that caring about coffee farmers isn't simply the realm of smelly, tree-hugging hippies. Now, as a smelly, tree-hugging hippy, when I'm not participating in love-ins and protests I try to be a fairly well-informed consumer, and I nearly choked on my granola when I discovered how poorly coffee farmers in general are treated.
The top coffee producers for the commodity trade are Brazil, Colombia, Indonesia, Vietnam, and Mexico, and a significant proportion of the coffee produced in these countries (with the exception of Colombia) for the commodity trade is the species Coffea Canephora, also called Robusta. Robusta is known for a few things: its resistance to disease, its higher yield than other varietals, its ability to grow at most altitudes, and its flavor, which generally is described in terms such as 'rubber', 'tar', or 'pencil lead'. YUM! It is also used to enhance the amount of crema in many Italian espresso blends, an addition that most people in specialty coffee frown upon. I don't mean to suggest that robusta is the main component of commodity coffee, but it is used as much as possible, and it is indeed sometimes the main component. It's traded on a different market than Arabica varietals (Arabica is a catch-all term for higher altitude varietals such as Typica, Bourbon, Longberry, Catuai, Mokha, or Supremo) at about 50-75% the price of Arabica. Coffee producers grow robusta because they may think they are at too low of an elevation to grow other varietals (and so may you, but I'll point out that Kona Arabica is grown at elevations as low as 200 m) or they just don't know any better. There has been little effort to educate many of these farmers, and considering most can't afford to educate their children, the cycle may only continue.
Commodity coffee is often stored for several years, sold/traded between companies, stored again, then blended and roasted in huge quantities, with 5-8 years between the farm and the roaster not being uncommon. In contrast, green (color, not buzzword) specialty coffee is usually 'current crop' and is considered to have lost much of its unique essence after as little as 9 months. Specialty coffee focuses on local varietals, even going as far as focusing on single farms and even 'micro-lots' or subdivisions of farms. By emphasizing single-origins, the specialty trade provides an impetus for farmers to strive for quality and raises the standard and the price of quality coffee.
The commodity coffee trade operates in a way that exploits small scale coffee growers by dealing with them only via middlemen, who may often receive greater compensation for their efforts than the farmer. Farmers often strike deals with local cooperatives to provide them some security and exposure to the industry, but sometimes these cooperatives are corrupt, providing a lower price than quoted and keeping much of the profit for themselves. Also, farm lots are combined, which masks the quality of exceptionally good lots by mixing with less than acceptable ones, meaning the farmer has no reason to try to increase his quality. In response to financial hardships created by rough markets and corruption, unethical individuals exploit farms by offering to buy beans immediately at a much lower price than the going market price, which itself is often not even a sufficient wage. In order to survive, farmers sell to these people, collectively referred to as 'coyotes', who in turn sell to commodity coffee importers. When harvest time comes around, these farmers have already sold too much to coyotes to make much profit, which in turn means they rely on sales to coyotes the following year in an inescapable cycle. Much of the coffee that commodity roasters use comes from this practice. This is not a small, isolated problem. It is the modus operandi for the commodity trade. There has been no push to stop this practice or to avoid importers that rely on it. Conversely, it is seen as a necessary business practice for coffee importers to provide the lowest price possible. It is my sincere belief that commodity coffee retail can only survive as a viable business model because of its reliance on exploitive business practices.
Commodity coffee is publicly traded, and like most anything there is no security in the market. In the 50s, a drought in Brazil made the price of coffee skyrocket, only to drop to an unprecedented level when other countries responded by planted large amounts of coffee (by the way, clear-cutting, anyone?). In the early 1960s, the International Coffee Agreement attempted to stabilize prices by setting quotas such that supply was near demand and prices remained high. Only they didn't. Prices fluctuated, just as they always did, quotas were often suspended, and the agreement fell apart in the early 90s. In 1993, the US pulled out of the International Coffee Organization completely, and in 1994, no economic clauses existed in the revised ICA. Also in 1994, a trade embargo with Vietnam suddenly was no more, and one of the largest Robusta producers in the world opened its doors to America's worst coffee retailers. Many farmers producing better quality beans suffered immensely when they had to compete in quantity with this new behemoth. In 2001, the vicissitudes of the market resulted in a price of 41 cents a pound (only 27 cents for robusta!). When the 'profits' made it back to the farms and plantations, many couldn't even cover their operating costs, let alone feed their families. When the bottom falls out on coffee prices, many small-scale farmers sell their farms and move to slums or illegally enter other countries to look for work, and many make the switch to what they know will sell. Hmm, what could a Colombian farmer grow to make money? Yep, our desire for quantity over quality has pushed a multitude of farmers into the drug trade (e.g. Ethiopia (PDF), Columbia, and Mexico). These are the things I think when someone tells me they're not really interested in buying 'the good stuff' because it's too expensive. By the way, the US did not join the ICO again until 2005, and the price of coffee is still unstable.
However, specialty coffee companies have been working together over the past several years to decrease corruption in the coffee trade by talking directly with the farmers and assuring the profits at every level of coffee processing and export are completely transparent. Advance credit programs have been developed to give farmers a chance to survive and even thrive without requiring the services of coyotes. These are the basic tenets of the Fair Trade movement (yes, it's not perfect, I know, but it's trying, dammit!), and most specialty coffee buyers either buy Fair Trade or develop their own 'Direct Trade' programs, which are usually even better than the Fair Trade standard. But overall, the best thing specialty coffee companies have almost unanimously done has been to work directly with the farmers and coffee mills to increase the quality and therefore price of their coffee and to provide much of this coffee as single origin, giving farmers the incentive to really push for the best quality possible.
However, this quality does require an investment by the farmer, and specialty buyers recognize this fact. It involves planting of better varietals, which takes 3 to 5 years, a multi-stage coffee picking process that focuses on the ripest beans, and better quality control and processing practices. Specialty buyers have worked with farmers and cooperatives through direct trade programs to offset these costs and allow farmers to escape from the commodity market. In contrast to the commodity market, in the specialty market, social responsibility is the status quo, not just because specialty coffee folks are often generally groovy people, but because specialty coffee companies are usually not publicly traded companies therefore not interested solely in the bottom line, Fair Trade/Direct Trade coffee is marketable, and the company will only get the quality they want from a coffee lot when the farmer has some solid financial reason to deliver that quality. When the focus shifts to quantity, prices drop and the farmer is, from an economic standpoint, ridden like a Shetland Pony.
At this point, I'd like to surprise the hell out of you. I, John Jon, am going to say nice things about Starbucks. ::pause for impact:: While they are by no means even nearly the most socially responsible somewhat-specialty coffee company, they are in fact the largest, and while I have a lot of bad things to say in general about their practices, I would like to commend them for a few things. They were among the first publicly traded corporations to sign direct, long-term contracts with coffee producers. Since 2000, they've done much to popularize Fair Trade coffee and often pay a good double the market price. Even more, they introduced us to paying a premium price for really good coffee. They also do put a good deal of money toward socially responsible goals. Currently, 81% of their coffee meets their C.A.F.E. certification (PDF) for ethical sourcing, though their certification system could definitely use some beefing up, as its clauses are written for larger coffee plantations as opposed to smaller farms and there are no minimum price stipulations.
No, America, we're not going to be able to support coffee farmers paying $2-5 a pound for roasted coffee. We need to become accustomed to paying a bit more for quality coffee. Coffee is a luxury, not a requirement, and while one can rationalize the need for cheap food, clothing, and shelter, there is no reason to exploit others, especially to deliver a product that is undeniably an extravagance. You have the money, and that's the only way everyone who gave you your morning cup is going to be able to make it through another season. And I'm not saying you have to spend much more. Fair Trade is a good first step, and it usually doesn't cost much, if any, more than other decent types of coffee. But the best thing you can do right now to support coffee growers and harvesters is to buy direct trade specialty coffee. Most reputable roasters either have their own direct trade programs or buy from importers that specialize in direct trade. For more info, check out these sites:
Intelligentsia's Direct Trade Program
Stumptown's Direct Trade Program
Counter Culture's Direct Trade Program
Sweet Maria's Farm Gate Program
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