| Author (Person) | Carstens, Karen |
|---|---|
| Series Title | European Voice |
| Series Details | Vol.10, No.4, 5.2.04 |
| Publication Date | 05/02/2004 |
| Content Type | News |
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By Karen Carstens Date: 05/02/04 THE global coffee crisis has hit growers hard. Over-production has squeezed once profitable plantations in the Americas and Africa out of a market increasingly dominated by Brazil and Vietnam. Policymakers have been alerted to the plight of farmers forced out of business in the face of stiff competition by anti- poverty NGOs, notably Oxfam. Subsequent calls for action to alleviate the coffee crisis were issued by both the Council of Ministers and US Congress in November 2002, and by the European Parliament in April 2003. Oxfam has meanwhile had some success in promoting "fair trade" coffee - this aims to ensure that beleaguered growers still have a market for the beans they cultivate. At the same time, it has been highly critical of makers of brands such as Nescafé and Douwe Egberts. Oxfam Scotland trade campaigner John McAllion said: "These companies continue to make massive profits while poor farmers face ruin from low coffee bean prices." But companies point out they are not to blame for deeper structural changes to the global coffee market that lie at the root of the problem. Moreover, producers, traders, trade unions and NGOs are working on an ambitious set of "common codes for the coffee community" that are to form the basis of future commercial transactions, due to be put forward by the end of the year. The European Coffee Federation (ECF), and other stakeholders, are awaiting a commodities report, due to be published this month by the European Commission. Partly a response to member states' and MEPs' calls for action to tackle the coffee crisis, it will examine several major commodities sectors, including coffee, tea, cotton and cocoa. The report, requested last Spring, will also propose guidelines the ECF hopes will "set the framework" for the coffee sector for several years to come. The EU could, for example, suggest strategies to improve market access for alternative coffee crops and reduce its own agricultural subsidies. ECF Secretary-General Roel Vaessen claims that roasters of the world's favourite beverage have been stuck between a rock and a hard place. "The difficulty is, we cannot tell a coffee producer in country A or B not to produce coffee if they have a competitive advantage in doing so," the Dutchman told this paper. "Oxfam tries to put a lot of the blame at the doorstep of the major roasters. But this is a structural phenomenon," he added. The trouble began in 1987. Until then, coffee was governed by an export quota system that aimed to keep supply and demand in balance. "On the consumer side, people were growing disillusioned with the system, where surpluses were dumped cheaply onto other markets," Vaessen explained. Such surpluses were, for example, sold to the former Soviet Union and eastern European countries - non-members of the International Coffee Organization and, hence, outside the official quota system. The US, among others, balked at subsidizing coffee for Russians in the twilight of the Cold War era, and eventually the system collapsed. Today, "we can export and import whatever we want from wherever we want," Vaessen said, which sounds like just another chapter in the ongoing globalization story. But then, in the mid 1990s, drought pushed down the crop yield in the world's biggest coffee exporter, Brazil, which triggered production in other countries - notably Vietnam, where high-intensity production of the smaller, rounder robusta beans (arabica beans come mostly from the Americas) has exploded since 1997. This led to "massive over-production by the late 1990s", Vaessen said. Even though some 50-60 developing countries produce coffee at present, Brazil, Vietnam and Colombia together account for 60% of global production. "It [coffee production] is finding its most efficient location," he added, just as shipbuilding or textiles manufacturing has shifted from Europe to Asia. The only long-term solution is "diversification, and in some cases a total reorientation" to other crops to foster "a real changeover to sustainable coffee production." Around 70-80% of Europeans drink coffee, which is the second biggest export product of the developing world after oil, with an annual turnover of some €6-8 billion. According to the ECF, some 25 million people have jobs related to the global coffee industry. Timeline: wake up and smell the coffee
Article discusses the challenges facing coffee producers in the Americas and Africa. |
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| Subject Categories | Politics and International Relations |
