Frontline World

GUATEMALA/MEXICO, Coffee Country, May 2003


Related Features THE STORY
Synopsis of "Coffee Country"

YOUR COFFEE DOLLAR
Follow the Bean

INTERVIEW WITH SAM QUINONES
Covering Bitter Grounds

FACTS & STATS
History of Coffee, Fair Trade, Economics

LINKS & RESOURCES
Background on the Coffee Crisis

MAP

REACT TO THIS STORY

   


Images of Lebanese landscapes, people and culture
Facts & Stats

The History of Coffee
Coffee Today
The Coffee Economy
Fair Trade in Coffee



The History of Coffee

The word "coffee" comes from Kaffa, a region in Ethiopia where coffee beans may have been discovered.

Coffee faced considerable resistance in many cultures over the centuries. It was blamed for, among other things, fueling riots, spawning seditious speech and even encouraging Satan worship.

During the 16th century, the Mufti of Constantinople forbade drinking coffee. Users in Cairo and Mecca also faced prohibitions. And in Turkey, where coffee drinking was banned as well, those caught taking the forbidden drink after a second offense supposedly were sewn into leather bags and dumped into the Bosporus Strait.

The "cappucino" was created when 17th century priest Marco d'Aviano rallied Christian armies to drive the Ottoman Turks from Vienna in 1683. When the Turks left Italy, they allegedly left behind their notoriously bitter coffee. The Viennese added milk and named the resulting concoction after the religious order of their priest -- Capuchin.

Lloyd's of London, the world-renowned insurer, started out in 1688 as Edward Lloyd's Coffee House, which underscores the central role coffee played in trade and commerce.

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Coffee Today

More than 500 billion cups of coffee are served worldwide each year.

Two main species of coffee cherries in cultivation yield two kinds of beans, arabica and robusta. More than two-thirds of the world's coffee comes from the arabica bean. The robusta bean is hardier and cheaper to grow, but its taste is considered inferior.

More than half of all Americans over the age of 18 -- 107 million people -- drink coffee daily. On average, U.S. coffee drinkers consume three and a half cups a day apiece.

Scandinavia boasts the highest per-capita coffee consumption in the world. In Finland, people drink more than four cups of coffee a day on average.

Medical researchers associate positive health benefits to moderate coffee consumption, including improved mood and the prevention of gallstone and kidney stone formation.

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The Coffee Economy

Coffee is the world's second-most-valuable commodity exporting by developing countries, after oil. The global coffee industry earns an estimated $60 billion annually. Less than 10 percent of those earnings end up in the hands of coffee farmers.

Profits for coffee-producing countries have declined dramatically. In 1985, for example, 38 cents of every dollar spent on coffee in the United States returned to producing countries. By 1995, that share dropped to 23 cents -- a 40 percent fall.

During the same period, the price consumers paid for their coffee increased by more than 30 percent.

By January 2003, the average price of coffee on the commodities market was 54 cents per pound, the lowest price for coffee (adjusted for inflation) in 100 years. Fewer than six years before, coffee was selling for $3.15 per pound, nearly six times higher, on the New York Coffee, Sugar and Cocoa Exchange.

In Central America alone, as many as 600,000 coffee farmers and workers have lost their jobs as a result of the coffee crisis, according to World Bank estimates.

Four major conglomerates -- Nestlé, Philip Morris, Procter & Gamble, and Sara Lee -- dominate world coffee markets, accounting for 60 percent of U.S. sales and 40 percent of the global coffee trade.

Coffee is grown in more than 50 countries in South America, Central America, Asia, Africa and the Caribbean. Nearly 25 million farmers worldwide depend on growing coffee for their economic livelihood.

Global coffee production in 2002/2003 is expected to reach record levels: 122 million 60-kilogram bags of coffee beans (16.1 billion pounds).

The world's top 10 coffee-producing nations, in order of amount produced, are Brazil, Vietnam, Colombia, Indonesia, India, Mexico, Ethiopia, Guatemala, Ivory Coast and Uganda.

Brazil produces more than a third of the world's supply of coffee, almost three times as much as the No. 2 producer, Vietnam.

The top 10 coffee-importing countries, in order of amount imported, are the United States, Germany, Japan, France, Italy, Spain, Canada, the United Kingdom, Poland and the Netherlands.

Though Germany occupies the No. 2 position among consuming nations, the country imports only half the amount of coffee imported by the United States.

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Fair Trade in Coffee

The fair trade movement was launched in the Netherlands in 1988.

TransFair USA, based in Oakland, Calif., is the only fair-trade-certifying label in America. The group, founded in 1998, has certified more than 23 million pounds of fair trade coffee.

Although coffee was the first, most commonly fair-trade-certified product, other fair trade imports include bananas, chocolate, honey, tea, sugar, orange juice and indigenous handicrafts.

Fair trade coffee meets several criteria. Growers must be organized into democratically run cooperatives. The cooperatives must agree to independent inspections. They also must use sustainable methods of agriculture. In return, the growers are guaranteed a living wage of at least $1.26 per pound for their coffee (15 cents more if it is grown without pesticides).

Although fair trade coffee constitutes only 2 percent of the world's coffee supply, consumer demand for fair trade coffee has grown in the United States -- from 1.9 million pounds imported in 1999 to 6.7 million pounds imported in 2001.

Fair trade coffee can be bought at roughly 7,000 retail outlets across theUnited States.

More than 100 brands of fair trade coffee are sold worldwide.

Revenue from fair-trade-certified coffee in the United States and Canada exceeded $64 million in 2000, which was a 50 percent increase from the previous year.

Since 1999, 13 million pounds of fair trade coffee has been imported into the United States, yielding an estimated $10 million in additional revenue for the farmers growing fair trade coffee.

In April 2000, retail coffee giant Starbucks agreed for the first time to carry fair-trade-certified whole bean coffee.

According to TransFair USA, more than 600,000 producers, in more than 32 countries, who sell coffee, tea and cocoa make their goods available through fair trade. There are more than 300 fair trade cooperatives worldwide for coffee alone.

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Editor's note: This page was updated on May 22.

Sources: Coffee Research Institute; Coffee Science Information Centre; Coffee Science Source; Fair Trade Federation, 2002 Report on Trends in the Fair Trade Industry; International Coffee Organization; James, Deborah, "Close, But No Cigar," Global Exchange; Javacafe.com's Coffee World; Miller, T. Christian, and Davan Maharaj, "World View: Coffee Growers' Good Fortune Dries Up,", Los Angeles Times, October 28, 2002; National Coffee Association of U.S.A. Inc.; National Geographic; Oxfam International 2002 Coffee Report, Mugged: Poverty in Your Coffee Cup; The Roast and Post Coffee Company; Straus, Tamara, "Fair Trade Coffee: Coming to a Café Near You,", November 30, 2000; Sugar India, "Coffee Timeline,"; TransFair USA; USDA Foreign Agricultural Service, Special Commodity Report, November 1, 2002; USDA Foreign Agricultural Service, "World Coffee Consumption by Importing Country," 2000 data; USDA Foreign Agricultural Service, "World Coffee Supply and Distribution for Producing Countries," 2001/2002 data; "The Daily Grind: The Long and Short Facts About Coffee," The Nelson Mail, February 25, 2003; "Strong Sales Put Buzz in Specialty Coffee Industry," East Bay Business Times, February 21, 2003; "Grinding Profits from Beans," Brand Strategy, December 3, 2002; "Low Coffee Prices Come at a Cost," Albuquerque Journal, November 25, 2002; "Global Issues Flow into America's Coffee," New York Times, November 3, 2002; "Wild Oats Markets and Green Mountain Coffee Roasters Launch Nation's Leading Organic Fair Trade Coffee Program in Wild Oats Stores," Global NewsWires, October 10, 2002; "Coffee Facts," The Guardian, September 18, 2002; "This Man Wants the World to Wake Up and Smell His Coffee," The Sunday Herald, September 8, 2002; "Coffee Bean Oversupply Deepens Latin America's Woes" Wall Street Journal, July 8, 2002; "Guatemala's Coffee Profits Down 50 Percent," Financial News, June 22, 2002; "Colombia Warns of World Coffee Crisis," UPI, May 22, 2002; "For a Better Brew, a Pinch of Social Justice," The Washington Post, October 18, 2000.