Coffee crisis calls for sustainable solutions

Posted June 20, 2005, Coffee, next to oil, is the second most widely traded commodity in the world. Earnings of the 50+ producer countries around the world have fallen by 50% to a 30 year low in 2002 /2003, from 10 billion dollars a year to some 5.5 billion dollars, since 1998. Only recently prices started to recover, but where prices for producers decrease, the roasters max their profits.

In September 2004 the draft for the Common Code for the Coffee Community (4C), was presented and signed by major roasters to improve working conditions and environmental standards in the industry. Although a step improving sustainability, it seems to be too little too late.

Already initiatives like Fair Trade and Utz Kapeh are operational and are making a real difference by opposition to the 4C code, which is not yet ready for implementation.

It is not clear if the devised system will comply with the minimum standards of transparency and traceability.

Producers need help to restructure their business. No real instrument is being developed to support producers to comply with the standard. Special attention will be required for smallholders.

There is no system ensuring that producers who comply with the standards will get a better price for their product.

Roasters should also commit themselves. A buyer’s code or rules and obligations for trade and industry are still missing. The Code as it takes form is actually limited to the behavior of producers. There is no agreement on a transparent pricing mechanism.

The code does not include a ban on GM coffee.

According to Walter Zwald, former president of the Swiss Coffee Trade association, the 4C is an attempt from the multinationals to counter the new sustainable initiatives: “..the arrogance with which the 4C initiative has been actually worked out suggests that there is real concern that schemes like Fairtrade, Utz Kapeh, Rainforest Alliance and others that actually demand a premium be paid for improving the lives of workers and the quality of coffee, are finally biting into the main stream roasters…the whole initiative could be constructed as their attempt to make themselves look good in the eyes of the public without having to pay for it.”

Call for a Worldwide Sustainable Coffee Fund

Alternative to the 4C, Mr. Zwald advices manufacturers to introduce a voluntary levy on raw coffee beans to promote sustainable developments. In an attempt to move this idea forward Mr. Zwald presented a proposal for a Worldwide Sustainable Coffee Fund, including a levy of $1 on every 60kg bag of beans to be paid for by the industry. The levy should raise a $70 million a year, split between projects to support small producers and promotion of coffee consumption in the world. Informally backed by 70% of the coffee-producing countries, the ICO for now agreed to explore the proposal for a second time, after rejecting it after its first presentation in 2001.

Background and additional info:

Recent news and research

[an error occurred while processing this directive]

Stay Up-to-Date –
Sign up for our Newsletter changes daily! Don't miss out on the latest interactive features, columns and news. Sign up now for our monthly e-newsletter and stay connected.


•Free the meat markets! End packer ownership and stop closed-door deals

• Support Saskatchewan farmers in efforts to block GM wheat

• Stop budget cuts to conservation programs--the one's that help you pay for environmentally sound farming practices!

Share Your Stories

Are you a farmer? A consumer? Whatever story you have to tell, let it be an inspiration to others.
Share it with us now...

T H E    N E W    F A R M – R E G E N E R A T I V E    A G R I C U L T U R E    W O R L D W I D E