A meeting of merchants, minds and matters

The exhibit hall is cavernous, and row after row of exhibitor stands fill it from end to end. At one booth, a major green coffee broker meets customers old and – it hopes – new customers in the making. At the next stand along, an espresso machine manufacturer peddles its wares and, right next door, a national coffee board promotes its country’s range of coffees to anyone who cares to drop by. Just across the aisle, a certification body seeks to recruit new licensees.

The world of coffee is gathered here under one roof – the roof of the convention centre which is hosting this year’s SCAA Expo, an event which is held in the USA every April and is the world’s largest coffee conference. From transnational coffee companies to small coffee producer organisations, all are welcome and many attendees from California to Colombia spend their entire time here in the exhibit hall.

Upstairs from the hall, there are also a number of lecture theatres in which speakers are addressing audiences on a wide range of coffee-related themes. Topics at the 2016 SCAA shows the breadth of subject matter; in one room, ‘Opening A New Cafe – Design It Right – Build It Once’ covers a very obvious and practical topic.  Nearby, ‘The Science Behind the New SCAA Flavor Wheel’ looks closely at coffee quality in a way that many will find important and useful to their businesses. Following straight on in the same lecture room, ‘Effective Strategies for Coffee Buyers’ explores challenges on the trading side of the coffee business.

While many of these talks look towards the retail end of the coffee business, the subject matter for these presentations is increasingly focusing on what is happening down on the farm. A good half of all the dozens of talks which make the SCAA program these days focus to a greater or lesser degree on sustainability challenges at producer level. One specific topic, ‘Exploring the Cost of Sustainable Production’ is so meaty that it requires two separate sessions to cover it. It is allowed two sessions because the specialty coffee industry understands that producer sustainability is such a critical matter to discuss. The industry’s very future depends on an ongoing stream of supply of good quality coffee, and it recognises that this supply is being thrown into doubt as a result of a rising tide of threats.

Those in the industry who are closely enough engaged with coffee producers understand that for the small farmers who provide much of the world’s coffee, due to the nature of the market the combination of small farm size, increasing production costs, climbing customer expectations around traceability and quality, volatile market prices, and a changing climate, threatens these farmers’ futures. As the SCAA’s executive director Ric Rhinehart has calculated,  with coffee export prices sitting at their present level a typical member of a coffee-farming family is currently being asked to survive on US50 cents a day – a figure which is less than half the UN’s extreme poverty rate.

But herein lies a challenge. While leaders in the specialty coffee industry find it easy to offer advice to individual companies on how they can improve their staff training, or their packaging, or their marketing pitch, they know that the issue of sustainable production is not one that a single company can tackle alone. How, for example, can one company take on significant extra cost in order to provide better returns to producers if its own customers can’t or won’t allow that business to pass on these costs, by taking their custom elsewhere? Various presenters at the SCAA have addressed this problem with the market model over the years by calling for greater collaboration between buyers, research institutions, governments, NGOs and anyone else who can help to direct resources towards improving farmer incomes within their areas of influence.

On a purely commercial level, such collaboration would need to extend all the way to consumers needing to understand and support higher prices for coffee. Here in New Zealand I have been asked by roasters, why we can’t all just pay the true cost of sustainable production? If only it were that simple. Our trading experience has taught us that we strike a delicate balance between paying higher prices, and losing sales volumes, as we strive to add as much value to producer co-operatives as possible through our position in the market. The level of collaboration required to address this problem would require all of those various actors in the supply chain who are either staffing booths or walking the aisles in the SCAA exhibit hall – the entire trading chain including the producers, the importers, the roasters, the cafe owners, and the end consumers – to gather around a table and together devise a more equitable trading model.

Short of this happening, just as the SCAA is doing, Trade Aid will continue fostering education and dialogue around this subject, in the expectation that this approach will in time help to provide better solutions to sustainable coffee production challenges for the coffee industry. If you are reading this, and wish to better understand some of the complex detail of coffee farm-level economics with a view to exploring new ways that might offer critical additional value to coffee farmers, then I welcome you to get in touch. Trade Aid will be happy to collaborate with you in seeking better outcomes for coffee producers.