Coffee farmers are not making enough money to ensure that the coffee industry is sustainable, said speakers at the International Coffee Organization’s (ICO’s) 6th Consultative Forum on Coffee Sector Finance, which took place on 21 September 2016. Chaired by Juan Esteban Orduz, President and CEO of the Colombian Coffee Federation, the forum brought together experts from the private and public sectors to discuss challenges facing the coffee sector with a special focus on the profitability of coffee farming.
Key points raised during the session included an understanding that the challenges faced by the coffee sector vary by region and country and that the industry must act now to address the effects of climate change and the social conditions of coffee growers, which have not improved fast enough. Addressing the topic of international prices and the volatility of the market, panellists debated the need for an alternative mechanism for the pricing of coffee and the necessity to increase the availability of innovative financial instruments for farmers of all sizes.
The ICO presented research entitled ‘Assessing the Economic Sustainability of Coffee Growing,’ a review of existing data on costs of production and profitability at the farm level in four countries: Brazil, Colombia, Costa Rica, and El Salvador. ICO economists discovered that price volatility and increasing costs of production at the farm level have caused farmers to operate at a loss in certain coffee years between 2006/07 and 2015/16.
Presenting the results of the study, Robério Oliveira Silva (shown here), Executive Director of the ICO, said that more data and research are needed to better understand the economic viability of farms and to help preserve the livelihoods of millions of farmers across the globe.