#7 | April 17, 2020

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Recap: Recent Developments in Coffee

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Welcome to Recap, a brief overview of recent coffee developments every two weeks from the Specialty Coffee Association. The International Coffee Organization has released a preliminary assessment of COVID-19’s impact on global coffee consumption. In addition to the immediate drop in “out of home” consumption due to social distancing measures, the assessment also outlines the profound effect a global recession would have on the coffee sector. It suggests that for every one percent drop in global gross domestic product growth, we will see a 0.95 percent decrease in growth of global demand for coffee. In absolute terms, this would be equivalent to 1.6 million 60kg bags of green coffee. The ICO currently estimates global coffee consumption at 169.34 million bags with demand already set to exceed production.We also still don’t fully understand how COVID-19 will continue to impact the supply of coffee or the laborers who grow, pick, and process it. Reports of missing containers, canceled routes, and delayed administration checks as coffee-growing countries enter lockdowns continue to increase. Honduras and Peru have both been forced to stop for 15 days in the middle of their harvest as new measures have come into effect to mitigate the spread of the virus. In India, picked and processed coffee continues to pile up in ports. But the situation may be the most dire in Brazil, which produces more coffee than any other country. Bloomberg reports that coffee growers in Brazil, anticipating the largest-ever harvest in history, may not have enough field hands to pick all the ripe cherry. Assuming pickers can successfully travel to farms—states and municipalities have closed borders, making travel difficult—they are likely to face hurdles securing safe housing or successfully self-isolating, if required. And farm owners, faced with a loss of income if they can’t secure the labor they need to pick their coffee, are accumulating more costs in cleaning supplies and transport fuel to try and retain as much of their harvest as possible. As President Jair Bolsonaro continues to downplay the impact of the virus, farm owners are waiting on a set of recommended best practices for hiring temporary workers—but they may only arrive just before or after the harvest start date.In Colombia, the National Federation of Coffee Growers, or FNC, has released a protocol to help coffee-farming communities avoid the spread of COVID-19 during the country’s harvest, which began in March and is expected to last until June. Written in plain language, the protocol covers basic actions to prevent the spread of the virus as well as step-by-step guidance on how to prepare and use disinfectant, the use of personal protective equipment, and preventative social distancing. It also clearly outlines how the arrival, housing, feeding, and recreation of field hands should be managed on medium-to-large farms, with a specific goal of minimizing travel between farms and urban areas. The FNC has made the protocol publicly available with the hopes that it will be useful to other coffee-growing communities and agricultural sectors. Organizations in cocoa have taken a similar approach with a public call to action for companies working in the sector. Concerned about the effects of COVID-19 on farming households, the VOICE Network, a global network of non-governmental organizations and Trade Unions working on sustainability in cocoa, have called for four key actions in a public statement. These include: ceasing all non-essential farm visits, supporting and reinforcing key health messages from national ministries, using existing supply chain mechanisms to support the distribution of healthcare supplies, and creating an emergency relief fund to temporarily support cocoa farmers’ income through June. If you want to dive deeper into anything you heard today, check out the links in the description of this episode. Recap will be back in two weeks’ time. Thanks for listening. Relevant Links:  ICO Releases Analysis of COVID-19 Impact on Global Coffee Sector Disruption to coffee’s supply chain continues to mount: “Fears Are Growing of a Major Disruption in the World Coffee Supply Chain,” Comunicaffe “Coffee Climbs as Locked-Down Consumers Seek Caffeine Fix,” Financial Times “Coronavirus: Lockdown Affects Rs 400 Crore Worth of Coffee Exports,” Deccan Herald “Coffee Growers Fret Lost Output in ‘Ticking Time Bomb’ Brazil,” Bloomberg  FNC Releases Protocol for Coffee Growers  VOICE Calls for a COVID-19 Response for Cocoa Farmers