Logo of Phnom Penh Post newspaper Phnom Penh Post - International price slump is placing Colombian coffee-growers in limbo

International price slump is placing Colombian coffee-growers in limbo

Content image - Phnom Penh Post
A man harvests coffee in Santuario municipality, Risaralda department, Colombia on May 10. RAUL ARBOLEDA/afp

International price slump is placing Colombian coffee-growers in limbo

High in the lush green mountains of western Colombia where they grow the soft beans from which the world’s finest coffee is cultivated, growers are up in arms over the giveaway prices being fixed a world away on the floor of the New York Stock Exchange.

Producers here say they are selling at a loss, blaming the crash devastating their industry on stock market speculators who have forced prices down to an all-time low.

“We are paid a pittance,” says Gustavo Echeverry, 50, expressing the frustration of many of the 15,000 or so inhabitants of this coffee-growing centre nestled in the mountains.

It’s a far cry, they say, from the “Fair Trade” coffee globally certified to ensure it is grown under equitable conditions, so that farmers aren’t exploited.

Some growers around the village of Santuario have been forced to rip up their crops to grow something – anything – else.

The coffee growers’ lot worsened with the last harvest, which produced beans pitted by a plague of beetles. Quality suffered, adding to an international price slump that has forced growers to sell below cost.

Producing a 12.5kg bag of coffee costs the equivalent of $22. But wholesalers pay Echeverry an average $21 a bag. “It’s an unfair trade,” he quips bitterly.

Ramon Jimenez has spent his life growing coffee on his San Antonio plantation nearby, but says the industry is on its last legs here.

“We never stop thinking that soon we may no longer exist as coffee growers,” says Jimenez.

The Jimenez family has been growing coffee here for three generations. Ramon’s 19-year-old grandson Javier says he grew up among the coffee trees on the plantation.

“I dream of taking over the farm, of succeeding my father and my grandfather, but if the crisis continues like this . . . I will have to look elsewhere, maybe even leave for the United States.”

Colombia is the third largest coffee producer in the world, after Brazil and Vietnam, and the number one producer of high-quality soft beans.

In Colombia, 540,000 families owe their livelihoods to the coffee sector. It’s the country’s top export, ahead of oil and minerals.

But in Santuario, “Coffee plantation for sale” signs posted up at the local offices of the National Federation of Coffee Growers (NFC) have sent a chill through the local industry.

Others, like Echeverry, have opened their farms up to tourism as a way to keep afloat.

Ready to leave

Tens of thousands of people have been displaced from these mountains over the tumultuous half century of Colombia’s armed conflict. Santuario’s mayor, Everardo Ochoa, says the exodus starts again every time coffee hits a crisis.

The international reference price for coffee has dropped from a high of $1.50 per pound in 2016 to less than a dollar – a historic low.

According to the International Coffee Organization (OIC), production – measured in 60kg bags – in 2018/19 will hit 167 million bags, higher than global consumption of 165 million.

The only reason coffee production still exists to any extent in Santuario is because many producers have “coffee in their veins”, and can’t do anything else, says Echeverry.

Back in 1993, Diego Henao was forced into a life-changing decision in a bid to save his two plantations, totaling 400,000 trees.

He emigrated. Entering the US illegally, he stayed 13 years and earned a Green Card permanent residency before returning full-time to run his plantation.

Since then, in lean times like now, he spends four months a year in the US working as a house painter, and then injects his savings back into his coffee trees so as not to borrow from banks.

Now 53, he says: “I’m very close to being happy, if it weren’t for the coffee prices.”

The “Coffee Cultural Landscape of Colombia” is recognised on the Unesco world heritage list, but there are fewer and fewer coffee trees.

Gabriel Ochoa, 70, has finished struggling with his: “I ripped them up . . . I’ve put down sugar cane instead and I don’t regret it.”

Fernando Morales-de La Cruz founded the Coffee for Change organisation to campaign for more equitable distribution of the industry’s profits.

He says half a kilogramme of green coffee equals 55 cups on the high street.

But multinational corporations pay only 90 cents, which trickles down to just 0.02 cents per cup to the producer. That’s “a quarter of what he received in 1983,” says Morales-De la Cruz.

Fearing the social impact of falling prices, the Bogota government has announced $80 million in aid and the NFC is seeking to extricate producers from the New York Stock Exchange, which has set prices for decades.

But to do that, the NFC says it needs to join forces with soft bean producers in Central America and Africa whose quality would allow them to negotiate their own prices.

Such a radical change will take time.

Meanwhile, up in the hills of Santuario, the next harvest comes in October-November. If nothing changes by then, more farms will go on sale.

MOST VIEWED

  • No payment required for travellers taking rapid Covid tests on arrival

    Ministry of Health officials said there would be no payment required for the rapid Covid-19 tests given to travellers who arrive in Cambodia from November 15 onwards after the quarantine requirement is lifted for fully vaccinated people. Health ministry spokeswoman Or Vandine told The Post on

  • General’s gun smuggling ring busted

    The Military Police sent six military officers to court on November 22 to face prosecution for possession of 105 illegal rifles and arms smuggling, while investigators say they are still hunting down additional accomplices. Sao Sokha, deputy commander of the Royal Cambodian Armed Forces and commander of

  • More Cambodians studying in US

    The number of Cambodian students studying at US colleges and universities in 2020-21 increased by 14.3 per cent over the previous year despite the Covid-19 pandemic, according to a recent US government report. The 2021 Open Doors report on International Educational Exchange showed that 848 Cambodian students studied

  • Cambodia, Thailand to discuss border reopening

    Cambodian authorities from provinces along the Cambodia-Thailand border will meet with Thai counterparts to discuss reopening border checkpoints to facilitate travel, transfer of products and cross-border trade between the two countries. Banteay Meanchey provincial deputy governor Ly Sary said on November 22 that the provincial administration

  • Prince Norodom Ranariddh passes away at 77

    Prince Norodom Ranariddh, the second son of the late King Father Norodom Sihanouk and former First Prime Minister of Cambodia, has passed away in France at the age of 77. “Samdech Krom Preah Norodom Ranariddh has passed away this morning in France just after 9am Paris-time,”

  • Police arrest Canadian with 167kg of drugs

    The Phnom Penh Municipal Court on November 15 placed a Canadian national in pre-trial detention in connection with smuggling and possessing 167kg of illegal drugs. Deputy National Police chief in charge of anti-drug enforcement Mak Chito told The Post on November 15 that the man was arrested