31 Jul Despite Third Wave, Same Old Poverty For Farmers
This morning while sipping a cup of delicious single origin coffee, I was struck by an article in El Economista, a major economic online newspaper in Mexico.
According to a recent study performed in Mexico, at least 48% of the population in 10 major coffee producing municipalities in Mexico lives in poverty.
Deep in the south of Mexico is the beautiful state of Chiapas, a well known origin of specialty beans. In Chiapas, two of the most important coffee municipalities display the highest levels of poverty among farmers. Motozintla and Chilon are the most productive municipalities in this state and (according to the statistics) the poverty has reached alarming and staggering levels; in Motozintla 81.3% of coffee farmers live in poverty and in Chilon this statistic tops at 95.3%.
As in many Latin coffee producing countries, coffee farmers have been hit hard by the onset of the fungus “La Roya” (coffee leaf rust) and by the depressed world market prices of coffee.
Since the 90s, the North American coffee industry earned hundreds of billions of dollars through the second and third wave of specialty coffee. During the past 20 years, certifications like Fair Trade Organic (FTO) and Rain Forest Alliance became widely accepted models to address the plight of coffee farmers around the world. Now it seems as if the earned premiums for quality and for social sustainability never had their intended impact.
The Mexican study shows that almost 50% of Mexican coffee farmers, despite their proximity to the world’s largest consumer market (USA), still haven’t advanced in their strive to get out of poverty. On the contrary, it appears that Mexican farmers have experienced a decrease in disposable income during the years of 2010-2015; during this same period, the specialty coffee industry has displayed an impressive rate of economic growth, generating unparalleled wealth for entrepreneurs and corporations.
Something is fundamentally wrong with the business model of our specialty coffee industry.
If we all get our creative and entrepreneurial minds together, I’m sure that we can come up with innovative and business concepts that will alleviate the unacceptable poverty of the coffee farmers, whom we all depend on.
Boot Coffee is sponsoring and coordinating a hands-on, comprehensive study performed by master’s students in economic and political science that will explore and investigate viable economic models to address the crisis of poverty in our specialty coffee industry.
Interested in collaborating? Join the CPR (Coffee Progress Research) initiative and email me!
Here is the article: http://m.eleconomista.mx/estados/2015/07/30/municipios-productores-cafe-pobreza