There is a lot of work under way to determine what became known as the living income for the coffee farmer in different countries. The word “prosperous” has been added to indicate that living alone is not enough for the coffee farmer who also has to prosper. There are proposals to add the word “sustainable” because the market increasingly wants coffee that is sustainably produced. It is not enough for farmers to have income to live and prosper if they also need to pay for what is required to produce coffee sustainably.
The need to achieve living prosperous sustainable income brings up the concept of shared responsibility throughout the whole coffee supply chain, from cup to seed, to pay for sustainable production at the farmer’s end. It should be from cup to seed and not seed to cup because unless the process starts at the consumer end all that is going to happen is that coffee farmers’ poverty is going to increase.
Preliminary data already available shows that real farmer income falls short of living income let alone living prosperous sustainable income in most coffee producing countries. In some countries living income is three, four or more times higher than the real income. Why is that so? More important than the reference living income itself is to understand why farmers’ income is below, often well below this reference income.
Knowing these figures – real and target income – and specially their differences in each country will help much with this country-by-country diagnosis of the problem. The list of potential suspects is known: low productivity because of lack of access to technology which has to do not only with its development and/or availability but also with its transfer to farmers, shortage of inputs and equipment due to lack of financing, imperfect markets, etc. The items above that are beyond both farm gate and farmer control are included in what has become known as the enabling environment
The solution to improve the enabling environment is not in the hands of any single player or sector in the coffee business and includes the governments of coffee producing countries. The role of government is critical to improve the enabling environment in all countries. The ideal approach is to have government and private sector – coffee supply chain and beyond – to work together to address the improvement of the enabling environment that will create the conditions for coffee farmers to increase their income.
The challenge is to bring government and private sector together to develop and implement a road map to improve the enabling environment in order to close the gap between real and living prosperous sustainable income. There are many proposals and discussions under way in coffee associations, companies and governments in producing and consuming countries. Since it is not realistic to expect that consumers will pay more for sustainable coffee, the road map will have to rely on shared responsibility along the supply chain from before coffee reaches consumer down to the coffee farmer. Can it be done? Will it make economic sense?
It will be helpful to understand how this has been done in countries where the living income gap does not exist or is small. What can be learned from them and is applicable to other coffee producing countries? Is it the availability of public extension and training services; the development of cooperatives that support small growers; efficient supply chains for coffee, inputs and equipment; strong coffee business associations; government regulation and incentives to facilitate financing; fair and “competitive” taxation; job and business opportunities available outside the farm in coffee growing areas; else?
The suggestion is here to use case studies of countries that succeeded in improving their enabling environment to help create the road map – process, participants and actions – for other coffee producing countries to do the same and to increase the living prosperous sustainable income of their growers. The next step is to include the coffee supply chain in importing countries and consumers to ensure that this responsibility to increase farmers’ income is also shared from cup to seed.
Opinion by Carlos Brando, GCP Chair – first published in June 2022