The coffee-price crisis explained, and how a Kenyan company is making a difference.

Many years ago I learned that coffee was the second most profitable commodity after Oil. Nevertheless, the biggest problem with this billionaire business is, as in the trading of any other commodity, that it is always the environment and the farmers that least benefit in these chains of transactions that we call world trade. 

_{What are the consequences of uneven coffee trade with the farmers? Deforestation, erosion, climate change, extreme poverty and migration are some of its consequences.} 

The current farmer’s unfair situation is the consequence of the “coffee price crisis” that began in the 1980’s and has lasted for over 30 years. It was during those years when the economy magnified its globalization, and suddenly coffee prices were imposed by the biggest stock markets at extremely low averages, solely based on a huge world offer that ever since then has been more than enough to cover the global demands. A kilo of green (raw) coffee fetched as little as 1 USD per kilo during the 2000’s! And who in this industry took most of this burden? Not the middleman and the trading companies, not the roasters, nor the retail stores and Cafés, but the farmers and their environments! 

While the average cup of coffee nowadays can go from 1 to 6 USD! And one kilo of specialty coffee can cost up to 60 USD in many stores, most of the farmers are still receiving very low prices for their coffee due to very uneven trade interactions globally. This not only affects the farmer’s social well being, but also their ability to manage their ecosystems in the best way.

What can we (coffee drinkers) do about this unfair situation? In my 4 year coffee trading experience, the best way I have found is to support those companies that practice direct trade with the farmers and are transparent about their production methods, their trade relationships, and of course: Their prices. 

That is why trading companies such as IBURU COFFEE are making a difference!

Leadered by Gakii Mugendi, as the daughter of a coffee farmer in Kenya, she experienced for herself how unfair coffee prices were, and how much harm this did to the farmers and their environment. That is how she decided to start her own trading company that could work directly with the farmers, not only by offering fair prices, but also by offering to them agro-ecological advice and knowledge to improve the sustainability of coffee farming in the Mount Kenya region.  

The history of coffee cultivation in Kenya has a lot of similarities with Mexico’s own history. To start with, both nations are recognized for being “Megadiverse” countries, which means that most of the known plants and animal species on this planet live in these territories. This simply means that both countries are extremely fertile and climate-friendly for coffee cultivation.   

Before the world coffee price crisis started, many Kenyan farmers applied a combination of the oldest coffee cultivation methods, together with their own indigenous farming practices that incorporated intercropping (two or more crops cultivated in one area) with shade trees, just like in the Mexican case! These older cultivation methods are well known to be the most ecological in coffee production.

As Gakii describes:

In the forest of Mount Kenya, (…) farmers grew native tree species on their coffee farms which offered habitat and food for many birds.  However, farmers began to remove these shade trees when the coffee economy crashed in the 1980s with the hope of increased yields. As the coffee prices worsened in the 1990s, many of them also uprooted their coffee bushes and continue to do so today. This has contributed to massive deforestation in the area surrounding Mount Kenya forest, as more land is converted for other agricultural activities like dairy and tea production.

The Ibúru coffee project was an “intervention” to address the severe deforestation in the area, but in a way that farmers could still provide for themselves a sustainable livelihood. 

Gakii continues: “The project aims to conserve the forest and increase tree cover in the adjacent areas by promoting shaded coffee farms, as a form of agroforestry and disseminating ecological knowledge about forest resources and biodiversity conservation”. 

Nowadays Ibúru Coffee is mainly distributed in Norway and Kenya, and is available in smaller quantities in other parts of the world. The company is supporting more farmers and importing a bigger stock into Norway in the year 2021! If you wish to support this project you can order their coffee right now on their webpage.

The founder also wishes to thank supporters of their just concluded crowdfunding (fnd.uz/Iburu).

“There is no special way we could ever repay you, thank you for making our story a success”, Gakii said.

The only way to put a stop to the coffee price crisis is to increase the global coffee prices offered to the farmers, and to evolve trade relationships into partnerships between farmers and distribution businesses! That is why we need millions of consumers and companies that can change the ways of coffee trading.  

Sources:

• Ibúru Coffee: https://iburucoffee.no/about-us/
• Macrotrends, “Coffee prices- 45 year historical chart”. URL: https://www.macrotrends.net/2535/coffee-prices-historical-chart-data 
• Margie Maria M. Gonzalez. Culture and sustainability: Lessons from Tosepan Titataniske from Cuetzalan, Mexico (Master’s thesis), 2018, Norwegian University of Life-Sciences.
• Ritu Prasad, “How the 2019 coffee crisis might affect you”, BBC NEWS. URL: https://www.bbc.com/news/world-us-canada-48631129