The Coffee Price Crisis
A primer on the crisis affecting the coffee industry and the SCA’s initiative to address it.
Launched in December 2018 by the SCA, the Coffee Price Crisis Response Initiative is aimed at understanding and addressing the price crisis affecting coffee and publishing a report with recommendations for the coffee industry.
While the C-market price has frequently been volatile—and has often been below the cost of production for many farmers—in August 2018, the benchmark commodity futures price for coffee slipped below one US dollar per pound, its lowest point for 12 years, and has hovered at or below one dollar for most of the ensuing months.
Smallholders vs. Shareholders: Investigating the Priorities of Specialty Coffee
Thanks to all who joined our recent webinar with Vera Espindola Rafael and Peter Kettler on issues related to farmer incomes and costs of production. The recording of the webinar is now available on YouTube here and as an episode of the SCA Podcast here. Watch or listen now and share with your friends and colleagues.
What We Aim to Achieve
A group of dedicated staff and volunteers from around the globe form the SCA’s Price Crisis Response (PCR) team. Learn about their work below.
Take Action: Identify and implement immediate, mid-term and long-term actions for SCA to address the price crisis that are “fit for purpose” for SCA.
Make a Long-Term Difference: Establish infrastructure to enable long term embedding of this work into SCA’s “ways of being” so SCA is fulfilling its fundamental mission into the future; this crisis has been going on for decades and will not be solved with a quick-fix project.
Industry Uptake: Stakeholder engagement to ensure maximum influence and uptake of SCA’s work. This will move beyond communications to think through how to drive behavior change in the sector.
A specialty coffee sector where diverse producers of differentiated coffee are fairly recognized for their high value product and where the rewards for these coffees are distributed equitably and transparently across the value chain, fostering economic prosperity and delivering coffee that tastes good and does good to coffee lovers everywhere.
The Price Crisis Response initiative exists to confront low commodity futures prices and price volatility, which threaten the specialty coffee industry by supporting the development and utilization of alternative economic models for specialty coffee. We know that shifting the entire industry can’t be achieved in one year but we hope to start by aligning the industry around a common goal.
The Problem to Solve
Consistently low prices, and pricing volatility, combined with the embedded systems that work to deter actors to respond to low prices by paying more, contribute to unsustainable livelihoods for coffee farming communities and the specialty sector as a whole.
The Questions to Answer
How might the global specialty coffee industry reimagine purchasing practices? What are the purchasing practices that have the potential to catalyze meaningful change to address the price crisis in our value chains?
Read, Watch, and Listen
Click below to find webinars, videos, podcasts, and articles on the price crisis and farm profitability. This content is delivered by coffee professionals from around the world and is an excellent source of information for the latest on issues affecting our industry. For our full library of content, click the yellow button below the thumbnails.
Articles / Announcements
- Announcement: Declaration of the Coordination Group of the World Coffee Producers Forum (Nairobi, March 2019)
- Article: C is for Commodity, Crisis, and Cost – 25 Magazine: Issue 7
- Article: From the ICO, Here's How Coffee Farming is Often not Viable (Daily Coffee News)
- Article: The Secretive Company That Pours America's Coffee (Wall Street Journal)
- Article: The Real Cost of a $6 Cappuccino (Erin Meister, Marketplace)
- Article: Cocoa Buyers Agree to Floor Price Proposed by Ghana, Ivory Coast (Reuters)
- Article: Fairtrade Calls for Higher Coffee Prices as Farmers Struggle to Stay Afloat (Coffee & Cocoa International)
- Article: JAB and Nestlé Need to Step Up, Sustainability Experts Say (Coffee & Cocoa International)
Reports / Research
- Report: Coffee Production Costs and Farm Profitability: Strategic Literature Review (SCA)
- Report: Assessing the Economic Sustainability of Coffee Growing (International Coffee Organization)
- Research: Emory Uniersity's Specialty Coffee Transaction Guide
- Infographic: Banking for Coffee (Rabobank)
- Report: Coffee Joins the Beverage Party (Rabobank)
- Report: Why Keurig is Acquiring Dr. Pepper (Rabobank)
- Report: Improving Labor Practices and Supply, A Pocket Guide (Sustainable Coffee Challenge, Conservation International)
- Whitepaper: Farmworkers & Coffee: The Case for Inclusion (SCA)
Audio / Video
Our Activities in 2019
In its first year, the SCA’s Price Crisis Response team will aim to accomplish the following objectives:
Increase funding and resources allocated to better understanding the topic in collaboration with the staff and volunteer advisory councils of the SCA’s Advocacy and Sustainability Centers
Conduct research on the coffee price crisis and its effects on producers and the entire value chain
Convene experts from the private sector and academia to explore alternative price discovery tools for the specialty coffee industry
Outline alternative economic models for the specialty coffee trade and provide a meaningful way for companies to address risks in the supply chain and publish a white paper with recommendations for the industry
Would you like to get involved in the work of the SCA’s Price Crisis Response team? We’re looking for coffee professionals to provide input on the report to be released at the end of 2019. Get in touch by submitting a message to our staff below.