A study led by Professor Jeffrey Sachs and commissioned by the World Coffee Producers Forum that addresses the imbalances and sustainability challenges in the coffee value chain has been published.
The Columbia Center on Sustainable Investment (CCSI) released the widely-anticipated report, ‘Ensuring Economic Viability and Sustainability of Coffee Production,’ on International Coffee Day.
The study, led by Professor Jeffrey Sachs, was commissioned by the World Coffee Producers Forum after its first meeting in 2017 in Medellín, where producers from across the globe gathered to discuss ways to address the coffee price crisis. Preliminary conclusions from the report were presented at the 2nd WCPF in July, in Campinas, Brazil.
The report analyses the root causes that have led to low coffee prices. It also describes the results of new quantitative supply and demand models that test for potential climate change impacts.
The models project that, by 2050, 75 per cent of land suitable for Arabica coffee production and 63 per cent of land for Robusta coffee production will be lost due to climate change, although the amount of remaining suitable land at that time will still be more than the total amount of land currently under coffee cultivation.
The models also show that coffee prices are not expected to significantly recover without intervention, given the potential for increased low-cost production in Brazil.
Based on these findings, Professor Sachs called on the coffee industry and producing countries to work in a coordinated manner to ensure sustainability, noting that “in the face of the ongoing low prices and deepening climate crisis, the coffee sector must undertake strong concerted efforts to support a sustainable and resilient future for producers and the sector overall.”
Roberto Vélez, CEO of the Colombian Coffee Growers Federation said, “the coffee value chain is worth US$200-250 billion a year, of which producers receive less than 10 per cent.
“Farmers in most producing countries cannot even cover their production costs; that is just wrong. The coffee industry cannot turn a blind eye on the gravity of the situation. Economic sustainability needs to be addressed immediately under a principle of co-responsibility, if we want to ensure the quality, diversity and sustainability of coffee that consumers expect all over the world.”
To achieve social, environmental, and economic sustainability along the coffee supply chain, the CCSI report calls for the development of National Coffee Sustainability Plans and contributions from major coffee industry actors of no more than half a US penny per cup towards a new Global Coffee Fund.
These funds would help to fill critical financing gaps for sustainability investments in coffee-producing regions and would be used to leverage additional funding from governments and donors. The report also includes other recommendations for increasing coffee producer profits.
“The serious and independent work of Professor Sachs and his team at CCSI will stir the discussion of the future of the coffee value chain. None of the players – producers, traders, roasters and consumers, public or private – can avoid the work needed to make the coffee value chain environmentally, socially and more importantly, economically sustainable,” said Juan Esteban Orduz from the Colombian Coffee Growers Federation.
Professor Sachs added: “Without sustained collective action, including pre-competitive contributions from roasters and retailers, more coffee producers will be in extreme poverty, and origins will be increasingly concentrated in a few countries.
“The industry risks losing much of its diversity and resilience. The major roasters and retailers should step forward to help ensure sustainability of the global industry, and governments and multilateral agencies should also increase their support alongside the industry.”
René León, Executive Director of Promecafé said, “it is necessary to have an open and candid discussion about the future of coffee and the negative impact of the current price crisis. If not taken care of, it will lead to more poverty, insecurity and migration all over the world. This report is a very important contribution to such discussion.”
Ishak Lukenge, Chairman of the African Fine Coffees Association, said “many producers have come to a point where they cannot even take adequate care of their families, let alone their farms or their communities. In this situation, the more profitable parts of the value chain, especially the roasters and retailers, cannot avoid their responsibility and must secure the future of the whole chain.”
The report and executive summary can be found at http://ccsi.columbia.edu/work/projects/coffee/.