Responding to critically low coffee prices in Central America, Starbucks has committed up to US$20 million to help smallholder farmers with whom it does business, until the coffee market self-corrects and rises above the cost of production.
The funds provided by the company will go directly to smallholder farmers in Nicaragua, Guatemala, Mexico and El Salvador to subsidise farmer income during the upcoming harvest season in Central America.
“A majority of the coffee we purchase comes from smallholder farmers and the coffee crisis in Central America related to low prices cannot be ignored,” said Michelle Burns, senior vice president, Global Coffee and Tea.
“We have a role and responsibility in helping smallholder farmers sustain their livelihoods. Their success will help ensure the long-term health of coffee productivity.”
“The National Coffee Association commends Starbucks for this important initiative to support coffee farmers, which is especially timely given that a rising supply of coffee has been impacting prices,” said Bill Murray, President and CEO.
“We have seen first-hand the effects of these historically low coffee prices on smallholder farmers,” said Ric Rhinehart, executive director of the Specialty Coffee Association of America. “It will be through the strong support of the coffee industry and its leading companies, large and small, that we can set the stage for a viable coffee future, letting the farmers know their investment cost in upcoming crops will be compensated, providing them with much needed stability in the industry.”
In addition, Starbucks will expand its existing ‘100 Million Tree’ donation programme and partner with the Colombian Coffee Growers Federation to supply 20 million coffee trees, technical support and supplies over the next two years to smallholder farmers in Colombia.
The seedlings will replace trees that are declining in productivity due to age and diseases like coffee leaf rust. This incremental investment is in line with the ongoing support Starbucks provides to coffee farmers and their communities, including access to US$50 million toward low-interest-rate loans to smallholder farmers to support reinvestment in coffee and to advance more sustainable practices.