Today is Valentine's Day. To honor the fact that I, candidly speaking, absolutely resent an entire day being wasted on the mandatory acknowledgement of other people's relationships, I have chosen to write a short post on the most mood-killing topic I can think of: economics. Or, specifically, the rising price of coffee, a threatening coffee shortage, and the depressing realization that Kraft, Smucker's, and Starbucks are recognized as the United States' three coffee giants.
http://kristensteinfineart.imagekind.com/store/ I love you a latte? Really?
As specialty coffees gain international popularity, inevitable strain is put on the coffee market, which like all other agricultural commodities depends upon a fragile network of variables for successful crop production: weather pattern shifts, natural disasters, political unrest, crop disease, urbanization--any one of these things can drastically upset the success of a coffee-growing season. I've been listening to the coffee community buzz about a tough year ahead for a couple of months now, and finally blocked out a little time this past week to sit down with my search engine and look into why.The first crucial thing to know about coffee as a commodity is that it is the second-most traded commodity in the world. The first is crude oil. Then comes coffee. Before gold, wheat, steel, natural gas, or rice is coffee.
The second thing to keep in mind follows naturally: Historically, the regions where coffee is produced do not contain the world's primary coffee-consuming countries. With rare exceptions, coffee grows between the Tropic of Cancer and the Tropic of Capricorn, sometimes referred to as the world's "coffee belt." But while the growing takes place nearer the equator, the top three coffee-drinking countries are Scandinavian. Finland boasts the highest consumption per capita, 608.2 liters/year. By contrast, the top coffee-producing country in the world, Brazil, has a consumption rate of only 50.1 liters/year. Surprisingly, the U.S. falls at a lowly #16 in the rankings for coffee consumed per capita. But when you consider how many people "per capita" entails (well over 312 million), we still turn out to be one of the chief importers of coffee worldwide.
Third and finally, it is especially important to remember that there is more than one kind of coffee. In the specialty-coffee world, the coffee you typically hear referred to is Arabica coffee, which is grown at higher altitudes and typically picked by hand in more than one harvest as the coffee cherries ripen throughout the season. Growing conditions tend to be in fragile balance, and the coffee yielded by an Arabica tree possesses a potentially great range of flavor and quality. (The best coffees in the world are Arabica, but it doesn't follow that all Arabica coffees are great.) The other most commonly discussed coffee is Robusta, a heartier tree that can succeed at lower altitudes and in more extreme climates. Robusta trees produce at a younger age and can more easily be harvested by machine. The beans are typically less expensive than Arabica, and are recognized to have inferior flavor and quality potential.
Why does this matter? One year ago, Sam Lewontin over at Why not? Coffee blog-posted that the average cup of coffee didn't cost enough. At first, I admit, I scoffed, but the more time I spend with coffee, the more I believe him. Green coffee prices have been rapidly rising over the past year, and have now matched a record set all the way back in 1994. This is due to several factors, including the biennial growing patterns of Arabica trees, unexpected rains, unexpected droughts, increased coffee consumption in coffee-growing countries (particularly Brazil), and a little governmental meddling here and there . . . and, as best as I can figure, the fact that coffee is traded in futures contracts essentially means that buying green coffee comes down to the heavily scientific art of guessing how well coffee crops might do at a given point in any year, barring natural disasters and war.
Right now, coffee production in several key countries is predicted to be lower this year, with weather named the primary culprit. Add to the perilous nature of coffee-growing the steadily increasing demand for higher-quality coffee, which is beginning to edge out the demand for Robusta beans, and you further shrink the coffee pool. Then consider that coffee is the second-most-sought-after commodity in the world, mix in the rising costs of transporting coffee due to rising fuel prices, and above all consider the admirable concern driving importers to pay fair-trade and direct-trade prices to discourage the severe human-rights violations sometimes perpetrated against farm workers. Summing it up, the fact that we're seeing an all-time high price for green coffee makes sense.
What doesn't make sense is that we as consumers want increasingly high-quality coffee served to us at a dependably low price. Though it all happens "behind the scenes" for us, we are effectively requesting that our coffee be grown meticulously and that all workers be paid and treated ethically; that the best coffee be imported lawfully and distributed to our favorite coffee shops; that the individuals who roast that coffee invest their time, energy, and finances in procuring extensive education and top-of-the-line equipment to coax the best possible flavor out of that coffee; that the baristas who are the final link to us in the process know, inside-out and upside-down, the store, the equipment they work with, the coffee of the day, multiple methods of brewing, latte-art if at all possible, and our customer-service expectations, and that they serve us excellent coffee quickly, professionally, and with a genuine smile. That, in a nutshell, is what We the Consumers demand. But lest there be any confusion on the matter, we demand it all for the same low price as we've grown accustomed to.
Think about this for a minute. If the consumer doesn't pay back into the meeting of these expectations . . . who absorbs the rising cost of coffee? The baristas, most at just over minimum wage, do. The cafe owners attempting to clear rent and pay employees while still purchasing coffee for their customers do. The small batch roasters who are starting to feel the strain of operating independently certainly do. The coffee estate owners obviously do, when roasters are hesitant to purchase coffee at higher prices from importers. And at the end of the ripple effect, the people who are least seen and most easily forgotten by us are, I'm concerned, ultimately the ones we're asking to pay the bill: Lower wages for farm workers mean lower production costs, and the rebound can travel all the way up back up.
http://www.sweetmarias.com/bolivia2003/ Ripe coffee cherries being sorted at a cooperative in Bolivia.
But at what cost? So many of the people working on coffee farms are already desperately trying to make ends meet, to have the freedom to feed their families, obtain medical treatment, and even perhaps provide education for their children. While I am clearly no expert in economics or international trade, common sense tells me that those who have the least say in a matter are usually the ones least visible within a community. And coffee already has a long and upsetting history of abusive relationships with those who tend to it.
Do I relish the idea of paying more for a cup of coffee or a bag of coffee beans? No. My bank account is hardly doing cheers on the sideline over here. But do I want good coffee? Yes. Therefore it seems to me the next question I need to ask myself is "Do I want good coffee enough that I'm willing to pay extra for it?" In my case, the answer is yes. In your case, it may be something different, but if so, you should be forewarned that even Folgers recently raised its price by about 10% in order to balance the impact being felt by its company. (And Folgers is not a small company. It belongs to Smuckers. Imagine what a tiny, independent roastery must be experiencing about now.)
Whatever the answer, the question doesn't appear to be going away soon. My advice is that you put it in the back of your mind, and think it over from time to time.
Now all this aside, in the spirit of pretending to support ridiculous holidays: For crying out loud, show a little love and tip your baristas today! I'm pretty sure it's what St. Valentine would do.