Chiapas Coffee part 2

Chiapas Coffee: Price, Politics and Precipitation

The volatility of coffee prices over the last two decades has been the biggest challenge for farmers and cooperatives in Mexico, and may be the single greatest factor threatening to make Chiapas’ tasty shade-grown coffee a “threatened species.”
This threat matters, beyond denying coffee drinkers a favored brew or forcing farmers to seek more lucrative crops, because, as I explained last week, the traditional methods of growing coffee plants offer huge environmental benefits for the region. But volatile prices and politics help foster mistrust, while war and climate change batter the foundations on which traditions are built.

In the mid-’90s, coffee hit a rock-bottom price of 40 U.S. cents a pound — below a living wage for small farmers in Mexico and elsewhere. Against this background, the central government, which had been very active in promoting coffee production by small farmers, withdrew its control. Stepping into this vacuum, in many cases, fair trade organizations organized coffee cooperatives to ensure a minimum wage for growers.

As Victor Pérez-Grovas, Edith Cervantes and John Burstein wrote for Oxfam International a decade ago, “These social organizations of small-scale coffee producers evolved a menu of strategies — the collective purchase and running of processing plants and warehouses, technical assistance, some financing, collective sales of their product even eventually exporting directly — and a tiered network, operating independently of the government.”

Just Coffee  --  How is life as a fair trade coffee roaster, purchasing from cooperatives in Chiapas? See Just Coffee’s Chiapas Report from October 2010. They also have friendly posters explaining fair trade and organic coffee principles.

Global prices of Coffea arabica, the more gourmet bean grown in Chiapas, are set through the New York Board of Trade, and Coffea robusta (think cheap ground coffee and instant) through London’s Euronext. Prices are greatly influenced by the top coffee corporations (including Kraft, Nestlé, Procter & Gamble, and Sara Lee, although the last named is moving out of the space) of those who collectively purchase about half the world’s coffee. The four largest coffee-producing countries (Brazil, Colombia, Indonesia, and Vietnam) affect the market depending on their crop quality and stockpiles. As reported in Revista Fortuna, although Mexico is the world’s fifth largest producer, and first for certified organic coffee, it still dances to a tune set by global prices.

In 2010, global prices spiked to highs of around $2.30 a pound. Although farmers are now theoretically paid more, higher prices destabilize the cooperatives and threaten to undo years of work.

“Cooperatives have limited funds to purchase large quantities when prices skyrocket,” said Roberto Guzman, the president of the Majomut cooperative. (The cooperative purchases coffee from 928 member-landowners, paying them fair trade prices in accordance with their certification, then ships then beans to overseas buyers.)

Speaking at their office on the outskirts of San Cristobal de Las Casas in Mexico’s Chiapas state, Guzman explained, “When prices jump, the coyotes representing multinational corporations tempt our farmer-members with big paychecks to leave our cooperative.

“In the short term, it’s an attractive option. Then what happens when the price plummets in three years’ time?”
Meanwhile, a low-grade civil war that started in the mid-’90s, the Zapatista rebellion and its focus on indigenous people, created both upheaval and renewal in Chiapas.

Mexico’s military fought the Zapatistas, and at times, entire villages were compelled to migrate, leaving behind crops and livelihoods. Paramilitary groups terrorized civilians, such as during the 1999 Acteal massacre, in which 45 men, women, and children were killed.
Although the Zapatista conflict put a serious strain on coffee production, the cooperatives emerged with renewed meaning, serving as focal points for the community’s reconstruction.

For example, the cooperative Maya Vinic formed following Acteal as a peaceful response by the community to regain strength.





Following the Zapatista movement, the renewal in indigenous cultural identity included resuscitating the traditional techniques of working the land, which included organic and shade-grown methods newly in vogue among Western consumers. Still, Mexico is a country where fertilizers and pesticides continue to enjoy a high status as emblems of technological advancement. So I was surprised to hear the barista at Toyol Witz (a cooperative’s café in the upper quarter of San Cristobal de las Casas) saying, “Organic is the right thing to do. Why not make good, healthy coffee? It is part of our heritage.”

How much Rain’s a-Gonna Fall?
A year ago September, during what Mexican President Felipe Calderon called the rainest season on record, deadly mudslides slammed into villages in Oaxaca and Chiapas, and neighboring Guatemala.

It was yet another sign that the wet season, from June to October, has turned from predictable to erratic. Unexpected rains now come as farmers are sun-drying coffee beans, while the balance of the dry season is becoming hotter and more intense. According to Romeo Dominguez, director of the conservation-oriented nongovernmental organization Pronatura Sur, wildfires are more common: in the coffee-growing regions of Sierra Madre and the Lacandonian Jungle in Chiapas, an unusual 70 to 80 fires have been reported in the last few years.

“Rivers that used to be year-round are now seasonal, cold temperatures are freezing crops, and rain erosion is destroying soil,” Dominguez recounted of farmers’ observations. This year’s crop in particular suffered a drop in quality, said Roberto Guzman of the Majomut cooperative. “Thankfully, yields were sustained, but we couldn’t fetch decent prices.”

A study of climate forecasts specifically for coffee communities in Sierra Madre de Chiapas noted that coffee suitability (i.e. its optimum growing conditions) squeezes into an increasingly narrow tier. In the prime coffee growing elevations of 600 to 1,400 meters above sea level of the Sierra Madre, a vast majority of land cover has coffee plantations. Lower altitudes will become less viable for coffee due to heat and drought effects. Higher altitudes are at risk from cold spells and rain erosion.

What are the options for preserving shade-grown coffee and farmers’ livelihoods? Strengthening resilience is the first step, according to an adaptation assessment by the German development organization GTZ. They collaborated with Más Café, a conglomerate of eight cooperatives and 2,200 producers in Chiapas, to determine the best practices for adaptation. They cited a number of techniques like erosion control to protect crops and natural composting of soil for productivity, along with pest-resistant crop varieties, and diversifying farmer’s income to reduce dependence on coffee as the only cash crop.

But if yields and income drop, farmers lose their incentive to raise shade-grown coffee. One option is to pay extra for farmers to keep forests intact as carbon storage, a tricky undertaking proposed at the global level by REDD, a forestry finance mechanism (officially known as the United Nations Collaborative Programme on Reducing Emissions from Deforestation and Forest Degradation in Developing Countries.) However, Mexico’s forests are privately owned in small plots, and committing 20 years to preserve forests may be difficult for small farmers.

Even if adaptation techniques are available and cost-effective, farmers may not perceive information about the risk as credible and have little motivation to act. According to sociological research in the Chiapas coffee sector, the farmers’ strong social identity undermines the legitimacy of information about climate risks and responses offered by outsiders.

According to study leader Elisa Frank, “being part of the in-group, coffee cooperatives can be a bridge between climate scientists and individual farmers, but perceived illegitimacy of experts can be a significant barrier. New relationships of trust need to be developed.”

The Future of Coffee in Chiapas
Three biosphere reserves are found in the Sierra Madre de Chiapas region: La Sepultura, El Triunfo, and Volcán Tacaná. These treasures of fauna and flora are now linked to the well being of coffee farmers. If coffee farmers go bankrupt and the land is transformed to other uses — like cattle grazing or corn — large stretches of forest will also be compromised.

It’s about the people, as much as anything. “We want to conserve forests,” said Dominguez of Pronatura Sur. “But without reasonable income for the farmers, for the security of their families, for the education of their children, there is nothing. They aren’t asking for much — just dignity.”
Technical considerations are important. But for tasty coffee to continue to grow in Chiapas, and for forests to remain intact, farmers need a way to maintain their income and dignity.