Cheap coffee causing poverty

Date: 19/09/02

By David Cronin

THE European Commission is being urged to fund the destruction of five million bags of low-grade coffee as part of a drive to boost the incomes of producers in some of the world's poorest countries.

Coffee prices are at their lowest levels for 30 years. Growers in Vietnam's Dak Lak province, for instance, face destitution because current prices cover only 60 of their production costs.

Oxfam says modern processing techniques are a major factor in the price slump.

Coffee companies use these to conceal the bitterness of low-quality beans and this has led to a proliferation of substandard coffee on the market, which has helped push prices even lower.

The charity wants the European Commission, rich governments and the big companies to bankroll the costs of destroying five million 69kg bags of lowest-grade coffee.

Oxfam estimates this would cost €100 million but bring about a 25 rise in coffee prices.

Phil Bloomer, Oxfam's head of advocacy, has called on the EU's trade and development chiefs to endorse the rescue plan.

'We're appealing to Commissioner Lamy and Commissioner Nielson to get together and show real political leadership,' he said.

'If they want to get the goodwill of developing countries, they've got to show good faith.'

Oxfam also wants the Commission to monitor the quality of coffee entering EU markets and to expose firms using poor-grade beans.

Lamy's spokeswoman Aranzazu Gonzalez said: 'We're analysing the roots of the problem and what solutions we could offer.'

The European Commission is being urged to fund the destruction of five million bags of low-grade coffee as part of a drive to boost the incomes of producers in some of the world's poorest countries.