The Coffee Crisis in Central America
In 2002 and 2003, Oxfam supported nine coffee cooperatives in Central America that chose to enter the specialty coffee markets (organics, fair trade, etc.) when the traditional coffee market was no longer a viable option.
Coffee has been one of the most important products for the Central American economy for decades, and a high proportion of the coffee produced in Central America is considered of the best quality in the world. Central America produces around 12 percent of the world's total supply, and although it is not the main source of income, coffee represents between 5 percent and 23 percent of total export revenues in Central American countries. Coffee is very important not only for income generation but also for employment generation—an estimated 1.5 million rural laborers worked in coffee during the 2001-2002 crop cycle. It is estimated that over 500,000 jobs have been lost since the beginning of the coffee crisis, and the situation is especially critical for the rural poor since the majority of coffee producers are smallholders living in remote rural areas who depend on cash income to pay for food and other essential items such as school fees and health care.
Effects on Small Farmers in Central America
Coffee in Central America is a family affair that depends on all members for labor during the 10-month productive cycle. Small producers, who usually reside in remote rural areas, rarely hire laborers outside of the harvest season. Small farmers, defined as owners of less than 15 acres of land, represent between 58-95 percent of all coffee growers in Central America. They are heavily dependent on their own harvest and extra cash from temporary picking work. These growers depend on this cash income to pay for food and other essential items such as school fees and health care, and they cannot establish any cash reserves for hard times. The crisis in the sector has created social imbalances, a general downturn in the rural economy, accelerated migration to urban areas, and instability in families, communities, and countries. Due to the number of men forced to migrate out of rural coffee-producing areas, the term "coffee widows" is now common.
Some smallholders have been forced to abandon coffee production because of the crisis and in the worst scenario to sell their lands, especially those that are not organized in cooperatives or producers' associations and are not receiving technical, financial and/or marketing support. Because of this situation, hard-hit areas are now in a situation of food insecurity: poverty has reached a level where farmers can no longer afford adequate food, resulting in malnutrition and, sometimes, even death.
Environment
Coffee production has changed in the last 50 years to a higher-yield, lesser-quality focus through mono-crops and heavy chemical use. The traditional methods of producing coffee in Central America use native trees for shade, which not only conserves soil and water but also supports a variety of plants and animals and moderates the surrounding climate. In some cases, this has forced traditional coffee producers to cut down shade trees and abandon the biodiversity of their formerly inter-mixed crops. Since small farmers are struggling to make a living despite low prices, environmental issues are usually not their first priority. Existing environmental problems have worsened as shade forests continue to be destroyed, leading to the elimination of fragile ecosystems. However, shade grown coffee markets provide a viable alternative.
Read more about Oxfam's What's That In Your Coffee? campaign.
Oxfam's Coffee Partners
EL SALVADOR
Humanitarian aspects of coffee
FUMA
The Maquilishuatl Foundation (FUMA), one of Oxfam's risk management and disaster relief partners, is currently undertaking a nutritional study on children in areas of El Salvador strongly affected by the underemployment as a result of the low international coffee prices. Through health trainings, installations of family vegetable gardens, and implementations of small poultry-breeding farms, FUMA is working to strengthen the organizational and productive capacities of communities. Additionally, FUMA will conduct advocacy and media work to bring national attention to the problem of health and food in the face of the coffee crisis. Other international relief organizations will distribute food rations to address the immediate problem of malnourished children, while FUMA's project addresses the question of long-term food sustainability.
Converting to Organics
APECAFE
The Association of El Salvadoran Small Coffee Producers (APECAFE) represents 11 coffee cooperatives of 540 small producers. Its creation allowed farmers to work to jointly market their coffee. Another goal of the organization is to create solutions to other problems facing their communities, such as the task of reconstruction after the 2001 earthquakes. In addition to creating of a new marketing plan and visiting international trade fairs, APECAFE is aggressively working to convert all of its members to organic production, thus bettering the environment and earning a higher price for its coffee. Its coffee was rated one of the best coffees in El Salvador by the Specialty Coffee Association’s Cup of Excellence competition.
GUATEMALA
Strong Businesses
CRECER
www.creceridea.comhttp://www.creceridea.com/
CRECER, an umbrella organization of various Central American artisans and producers, is working to allow small coffee producers and their families to overcome the crisis through facilitating their entry into the specialty coffee market and strengthening the organizations' business and marketing capacities. With Oxfam's support, CRECER will play a leadership role within a group of 5 Guatemalan cooperative organizations, reaching an estimated 5,000 people. CRECER's approach focuses on across-the-board business improvements for a sustainable future in all coffee markets. According to Coordinator Ileana Cordón, "We are working as much on quality at a business level as we are on the level of quality in a cup of coffee."
CRECER Beneficiary
Guaya'b
An association of indigenous coffee and honey producers, Guaya'b represents approximately 284 families through 21 grassroots groups. They produce high-altitude, high-quality coffee using the shade grown method, planting native shade trees to improve the soil quality and the taste of their coffee as well as providing habitats for local wildlife. Thanks to the benefits of cooperative membership, Guaya'b has been able to start other programs such as a loan fund and women's weaving projects.
CRECER Beneficiary
ASOBAGRI
ASOBAGRI is another indigenous cooperative representing more than 400 producer families. Their success in selling their coffee in the specialty markets has allowed them to undertake other projects, such as irrigation and literacy projects. Though the harsh terrain and remote locations of their members can make organizing difficult, ASOBAGRI has risen to their challenges by training a network of promoters to provide local training within villages. Unfortunately, despite their success, the leaders of ASOBAGRI are aware that they cannot meet the demand for all the cooperative members who wish to join the cooperative movement and lessen their suffering from the coffee crisis. As President Edgar Mérida says, "Our hearts are bigger than our abilities."
Quality, Knowledge and Exports
Manos Campesinas
The Civil Association of Small Coffee Producers, Manos Campesinas, brings together seven base organizations in which 1,073 members participate. Manos' philosophy is to provide high-quality, socially responsible coffee. They are currently working on training cooperative members and sharing their knowledge of the benefits of cooperatives, coffee quality, commercialization and export licensing. Between the turbulent political situation in Guatemala and the devastated coffee economy, Director Jerónimo Bollén says, "There is nothing positive about the situation in Guatemala right now." However, thanks to Manos Campesinas' work, outward migration to urban areas and the US has fallen, preserving families and communities alike.
Increased Production for Higher Incomes
CIDECA
The Council for Central American Development Research (CIDECA) is working with communities near ASOBAGRI to generate permanent and sustainable employment through higher salaries. They are conducting participatory assessments and training with coffee and cardamom-producing communities to determine the best way for these communities to confront the coffee crisis. Through training programs, the establishment of a storage center and the construction of a processing plant, CIDECA hopes to provide self-sustaining and equitable business practices with a focus on increasing women's participation.
NICARAGUA
Business Strengthening
COSATIN
The Cooperativa de Servicios Agropecuarios Tierra Nueva (COSATIN) serves more than 500 small producers living in 25 communities of Nicaragua. In addition to its sustainable organic agriculture work in coffee and honey production, COSATIN hopes to improve its marketing strategies and institutional capacities to meet the stricter requirements of today's demanding quality coffee market. COSATIN's work has made definite impacts on its member communities. "Fair trade helped raise the living standards of the families. Families have totally changed their homes and might even have electricity now," says President Jorge Abarca Trujillo. "Many of them have able to buy more land, which they can now cultivate as well."
HONDURAS
CCCH
www.lacentral.hnhttp://www.lacentral.hn
La Central de Cooperativas Cafetaleras de Honduras (CCCH) groups together 61 cooperatives, representing over 6,000 Honduran coffee farmers. Since an estimated 95% of Honduras' coffee farmers are small producers, the country has been especially hard hit by the crisis. Since Honduras has historically been mislabeled as having poor quality coffee, La Central's staff work hard to establish relationships with importers and buyers and improve Honduran coffee’s reputation. In addition to traditional cooperative work such as micro-enterprise and education, La Central sees itself as an engine of local development. To that end it works tirelessly to establish a Honduran national policy on coffee.