Sustainable coffee

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Sustainable coffee is coffee that is grown and marketed for its sustainability. This includes coffee certified as organic, fair trade, and Rainforest Alliance. Coffee has a number of classifications used to determine the participation of growers (or the supply chain) in various combinations of social, environmental, and economic standards. Coffees fitting such categories and that are independently certified or verified by an accredited third party have been collectively termed "sustainable coffees". This term has entered the lexicon and this segment has quickly grown into a multi-billion dollar industry of its own with potentially significant implications for other commodities as demand and awareness expand.

Early history and definition[edit]

Coffee has several types of classifications used to determine the participation of growers (or the supply chain) in various combinations of social, environmental, and economic standards. Coffees fitting such categories and that are independently certified or verified by an accredited third party have been collectively termed "sustainable coffees." The term “sustainable coffee” was first introduced in expert meetings convened by the Smithsonian Institution Migratory Bird Center (SMBC), NAFTA’s Commission for Environmental Cooperation (CEC) and the Consumer Choice Council (CCC) in 1998. The CCC’s 1999 report, “Sustainable Coffee at the Crossroads”[1] is the first use of the term in the public sphere. It discusses interpretations of sustainability and identifies options such as organic and fair trade as “sustainable coffee”, though it does not offer a single functional definition.

The CCC report emerged during the same period as notable World Bank publications [2][3] and an IMF paper [4] that were among the first to identify the economic and social problems in coffee origins that would be the basis of the coffee crisis that more fully unfolded early in the 2000s. The SMBC contributed some of the earliest evidence of the environmental impacts occurring in some of the most important coffee growing regions of Central America.[5][6] The ecological and economic concerns were discussed at meetings hosted by the CEC (“Workshop of Experts on Sustainably-produced Mexican Coffee” in Oaxaca in 2000 that resulted in The Oaxaca Declaration. The International Coffee Organization (ICO) voiced and documented some of the factors leading to the crisis, especially the dramatic decline in coffee prices to producers.

First market estimates[edit]

Initial trade volumes were estimates because no agency, including the certifiers themselves, accurately tracked them at the time.[7][8] The first thorough assessment and the first concise definition appeared in research documents commissioned by several organizations in 2001. The Summit Foundation, the Nature Conservancy, the Commission for Environmental Cooperation, the Specialty Coffee Association of America, and the World Bank combined to fund and publish the first large-scale assessment of the markets, the value and the volumes for these coffees (a statistically significant random sample across North America of 1558 retailers, 570 roasters, 312 wholesalers, 120 distributors, and 94 importers). The resulting "Sustainable Coffee Survey of the North American Specialty Coffee Industry".[7] indicated the availability of four primary certified sustainable coffees(in order of importance then): Organic, Fair Trade, Bird Friendly (Smithsonian Institution Migratory Bird Center), and Rainforest Alliance.

During the nadir of the recent coffee crisis (2001–2003), prices reached record low levels (49 US cents/lb according to the ICO indicator price, April 2001) and left many producers in very difficult conditions. By 2003, the idea of sustainable coffee was starting to become a common topic at conferences, in research, and in policy discussions. "The State of Sustainable Coffee"[9] published by the International Coffee Organization and the International Institute for Sustainable Development (IISD) in 2003 noted that sustainable coffees provide new opportunities to coffee producers who face difficult prices and production conditions that otherwise keep them in poverty. The book was the first dedicated to the topic of sustainable coffee and outlines the development of evolving concepts for sustainability in coffee and was also the first to identify the market channels, market conditions and volumes for sustainable coffees in European markets and Japan.

David Hallam, the Food and Agriculture Organization of the United Nations' (FAO) commodity chief, in 2003 notes that “…organic and fair trade products can also command a premium price.” However, these premiums were somewhat limited.[10] By 2004, a World Bank report, “Coffee Markets: New Paradigms in Global Supply and Demand”[11] substantiated that structural shifts in the global industry of coffee will likely hinder significant advances for many producing nations to more equitably participate in what is the world’s most valuable agricultural trade product. It also confirmed coffee's importance in more than 50 countries and its value in a number of producer countries as a primary, and sometimes only, source of cash income for many farmers. It noted that “differentiated segments”, in which certified coffees such as organic and fair trade are included, “can provide producers with competitive advantages and added value.” It further suggested that these are “important because of their growth rates and their potential to provide better social, economic, or environmental benefits for farmers”. By this point, in mid-decade, the category of sustainable coffees was firmly established as one of the emerging paradigms in the global production and trade of coffee. The same World Bank report identified that the production of such sustainable coffees had expanded beyond mostly Latin American origins to include modest exports from Africa and Asia.

Sustainable coffee initiatives expand[edit]

By the mid-2000s, sustainable coffees came to include new certification initiatives such as UTZ Certified and Common Code for the Coffee Community (4C) as well as certifications used exclusively by individual firms (Starbucks and Nespresso). Most certifications, by the decade’s end are now widely available not only in specialty stores and cafés but also in major supermarkets and under national brand names of global food companies such as Kraft and Sara Lee. At the ICO 2010 World Coffee Conference, former World Bank coffee expert Daniele Giovannucci [12] noted that in 2009 more than 8% of the global trade in raw (green) coffee was certified to one or another of the major sustainability initiatives. Though growing quickly, sustainable certified coffees still constitute only a few percent of the total purchasing of the largest coffee brands owned by Nestlé, Kraft, and Sara Lee.[13] The leading global brands, in terms of volumes purchased, are Starbucks, whose private certification (C.A.F.E. Practices) covers nearly 90% of its purchases,[14] and Nespresso whose purchase of sustainable coffees (Rainforest Alliance Certified) now accounts for more than half of its total buying.

Current issues[edit]

From a market share of zero to a share 8% of the global coffee industry in one decade suggests that sustainable coffees are no longer a small niche. Efforts are underway by various certification bodies, non-governmental organizations (NGOs) and global food companies to develop the production of sustainable coffees in the poorest regions of the world, such as Africa, and to measure the actual impacts that the various initiatives, standards and certifications. Whilst a number of papers have been published on the topic, high quality research is still lacking. Resources for the Future, a research think tank, undertook a broad literature review in 2010 and identified 37 relevant studies, only 14 of which use methods likely to generate credible results. Allen Blackman and Jorge Rivera, the authors of “The Evidence Base for Environmental and Socioeconomic Impacts of “Sustainable” Certification” [15] conclude that empirical evidence is limited and that much more research is necessary to understand whether these initiatives are having the claimed impacts.

The International Social and Environmental Accreditation and Labelling (ISEAL) Alliance is a global association for social and environmental standards whose members include many of the major standards systems active in sustainable coffee such as: Fair trade, Rainforest Alliance, UTZ Certified and the 4C Association. Its members have resolved to abide by applying a new Impacts Code in 2010 that requires them to develop a transparent Assessment Plan to provide reasonable measurement of their impacts. Another initiative is already developing and applying scientific metrics to understand sustainability impacts at the field level. The non-profit Committee on Sustainability Assessment (COSA), is a consortium of global organizations led by the International Institute for Sustainable Development, (IISD) and the United Nations Conference on Trade and Development (UNCTAD), as part of their Sustainable Commodity Initiative (SCI), is already developing and applying scientific metrics to understand sustainability impacts at the field level. COSA’s stated purpose is to measure sustainability and its mandate is to achieve “a credible set of common global measures for agricultural sustainability along the three balanced principles (environmental, social, and economic)”.[16] The unanimous International Coffee Organization endorsement of the COSA program notes that COSA builds management capacity with local partnerships in producing countries to facilitate an understanding of the effects (costs and benefits) of the many sustainability initiatives.[17] The United Nations International Trade Centre (ITC) and its Trade for Sustainable Development program is also developing a global online platform to better understand the distinctions of the diverse sustainability initiatives with basic comparisons of the standards and also a mapping system of their availability. ITC has also announced partnering with COSA to make the COSA database of thousands of scientific observations on this topic available publicly in 2011-12.

See also[edit]

References[edit]

  1. ^ Rice, Paul and Jennifer McLean. 1999. Sustainable Coffee at the Crossroads. The Consumer’s Choice Council: Washington DC.
  2. ^ Morriset, Jacques. 1998. Unfair trade? The increasing gap between world and domestic prices in commodity markets during the past 25 years, World Bank Economic Review, vol 12 (1998), pp. 503-526. The World Bank: Washington, D.C.
  3. ^ Giovannucci, Daniele, Peter Brandriss, Esteban Brenes, Ina Marlene Ruthenberg, and Paola Agostini. 1999. Engaging Civil Society to Create Sustainable Agricultural Systems: Environmentally-Friendly Coffee in El Salvador and Mexico. In Thinking Out Loud (Latin America and the Caribbean Civil Society Team) The World Bank: Washington, D.C. Online at: [1]
  4. ^ Cashin, P., Liang, H. & McDermott, C.J. 1999. How persistent are shocks to world commodity prices? Working Paper WP/99/80. IMF: Washington, D.C.
  5. ^ Rice, Robert. 1996. Coffee modernization and ecological changes in northern Latin America. Tea and Coffee Trade Journal, September 104-113.
  6. ^ Rice, Robert., Perfecto, I., Greenberg, R. and Van der Voort, M. 1996. Shade coffee: a disappearing refuge for biodiversity, Bioscience, 46 (8) 598-608.
  7. ^ a b Giovannucci, Daniele. 2001. Sustainable Coffee Survey of the North American Coffee Industry. Jointly published by The Commission for Environmental Cooperation French and Spanish and The Specialty Coffee Association of America English
  8. ^ Dankers, Cora and Pascal Liu. 2003. Environmental and Social Standards, Certification and Labelling for Cash Crops. Commodities and Trade Technical Paper 2. Food and Agriculture Organization of the United Nations: Rome.
  9. ^ Giovannucci, Daniele & F.J. Koekoek. 2003. The State of Sustainable Coffee: A Study of Twelve Major Markets. International Coffee Organization, London; International Institute of Sustainable Development, Winnipeg; United Nations Conference on Trade and Development, Geneva. abstract
  10. ^ Hallam, David. 2003. Falling Commodity Prices And Industry Responses: Some Lessons From the International Coffee Crisis. In Commodity Market Review 2003-2004. FAO:Rome.
  11. ^ Lewin, B., Giovannucci, D., Varangis, P. 2004. Coffee Markets: New Paradigms in Global Supply and Demand. World Bank: Washington DC.
  12. ^ Giovannucci, Daniele. 2010.Presentation at the ICO 2010 World Coffee Conference.
  13. ^ Tropical Commodity Coalition. 2009. Coffee Barometer 2009.
  14. ^ Starbucks Corporation. 2009. Fiscal 2009 Annual Report.
  15. ^ Blackman, Allen and Jorge Rivera. 2010. The Evidence Base for Environmental and Socioeconomic Impacts of “Sustainable” Certification. Resources for the Future: Washington DC.
  16. ^ Giovannucci, Daniele, Jason Potts, et al. 2008. Seeking Sustainability: COSA Preliminary Analysis of Sustainability Initiatives in the Coffee Sector International Institute of Sustainable Development: Winnipeg, Manitoba.
  17. ^ ICO document WP-Board No. 970/05 Rev. 1