ADDRESSING COLONIAL INEQUALITIES
IN THE COFFEE SECTOR
Coffee has come a long way since it was shipped around the world by European colonial powers centuries ago. However, while these colonial empires are a thing of the past, they have left their marks on today’s coffee sector.
For this article, we looked at how colonialism has shaped the coffee sector of today. Read on to find out more about how and where colonial inequalities remain, and how we can address them.
COLONIALISM AND COFFEE: A BRIEF HISTORY
Coffee became a mass-produced, globally traded commodity during its “first wave”. This was largely orchestrated by European colonial powers who established themselves in coffee-producing countries in the Caribbean, Asia, and the Americas in the late 1700s.
Coffee consumption grew exponentially in the 1800s when it became more accessible around the world. Rising demand called for mass production, and most European settlers responded by establishing coffee-growing estates in their colonies. To minimise production costs and maximise their profit, many of these estates imported slaves from Africa to work on coffee plantations.
Chris Oluoch is the Programmes Director at Fairtrade Africa, a member of the wider Fairtrade International movement which represents Fairtrade-certified producers in Africa and the Middle East. He tells me that settler arrived, targeted prime land for agriculture, tested the fertility of the soil for plantation farming, and divided the land into cultivation areas for different crops – including coffee.
“In those days, in Kenya, coffee-growing estates were called ‘White Highlands’. All the value was being thrown back to the European and American countries, and the African continent was left with nothing,” he says.
Even though these colonies are now independent countries and slavery has since been abolished, the effects can still be felt today. After colonialism ended and coffee-growing land was returned to native producers, many of them were only left with small parcels of land. This, Chris tells me, effectively forces them to sell through established multinationals, and leaves them unable to scale up and grow effectively.
WHICH EXISTING COLONIAL STRUCTURES REMAIN?
Now we have an understanding of how colonialism influenced the coffee trade through history, let’s explore how it affects the sector today.
VALUE ADDITION AT THE END OF THE SUPPLY CHAIN
Historically, value has been added to coffee in the consuming country, where it is roasted, sold, and consumed. As such, this is where the majority of the profit is made. This is a dynamic which has not changed much today for most commodities, including coffee.
Coffee producers mostly export green coffee – a raw commodity with a low market value and little potential for profit. It still rewards the bottom of the value chain – producers – the least, despite the fact that much of a coffee’s quality is acquired at farm level.
PRICES ARE REGULATED IN CONSUMING COUNTRIES
Coffee producers are often “price takers”. Many of them are unable to dictate when and at what price they sell their crop. Martin Mayorga is the founder and President of Mayorga Organics. He says: “The market decisions and direction pricing happens here in the US, and origin countries are at the mercy of that.”
Pricing decisions are generally made by those in consuming countries, while those will be impacted the most by price fluctuations – the producers – are largely unable to influence them. While efforts are being made to price coffee in a more inclusive way, we are still a long way from breaking this pattern.
FOREIGN PRESENCE IN PRODUCING COUNTRIES
Although mills and exporters are based in coffee producing countries, they are often owned and operated by foreign entities. These companies are mostly European and American who set up mills and export houses at origin.
“This is because it’s cheaper,” Martin explains. “One of the big things I’ve seen lately is foreign mills signing producers on multi-year contracts. They use stability as an incentive when market prices are low or volatile.” Producers sign these long-term contracts for stability, but are unable to change or negotiate their prices if, for instance, the C price increases.
Martin goes to explain that these mills then provide producers with access to credit, but at a high interest rate. He adds that in some cases, if producers default on their loan, the mill then takes their farms – a system very reminiscent of colonialism.
HOW HAVE THINGS CHANGED?
Phyllis Johnson is the founder and President of BD Imports. She highlights that even though many coffee producing countries are fully independent, the strongest trade relationships still in place today are the product of colonialism.
“If someone takes ownership of someone’s land and culture, it makes it incredibly difficult for them to reform and gain their own power and strength,” Phyllis explains. “Vulnerability to that other country is in place for what appears to be forever.”
FREE MARKET ECONOMICS IN PRODUCING COUNTRIES
In theory, independence and a free market should have improved things for coffee producing countries. However, in many cases, it had the opposite effect. In the 1980s and 1990s, a wave of market liberalisation swept across Africa and Latin America as part of economic structural adjustment programmes designed by the World Bank and the International Monetary Fund.
Chris tells me this put African producers at a disadvantage because they were not prepared. He says that they did not have the necessary production scale to compete on the global market, and that the economic freedom was not quite as beneficial as it seemed on paper.
Furthermore, these programmes removed pre-existing government subsidies, which made farming very expensive. “Competing in the global arena became impossible,” Chris concludes.
LACK OF OWNERSHIP OF THE CONSUMER PRODUCT
Internal coffee consumption in producing countries is an ongoing issue. For many producing countries, it may also be an unwelcome reminder of colonial structures.
Phyllis shares an anecdote with me: “When I was in Uganda, I talked to the women in the rural areas about coffee. They would call coffee ‘the whipping product’, a product they related to pain and oppression because they were effectively forced to grow it, with no other alternative for income.”
Uganda’s coffee consumption is growing, but in the rural areas, Phyllis said she was surprised to discover that many growers didn’t know what it was used for. If producers don’t consume coffee or relate to it, how will they ever truly have ownership over their crop?
A COLONIAL MINDSET
Even though many former colonies are now independent, Phyllis says that for many countries, this has not brought much real change. “If you are the product of generations of colonised people, you continue along the same pathway because you don’t know anything else.
“Nobody is going to change anything just because policies or systems change – neither the oppressor nor the oppressed,” she says.
Martin says that he sees the perpetuation of this mindset as a major obstacle to empowering coffee producers. In Latin America, he says that there has been significant growth in family estates. “These are [historically] poor people who have grown by aligning with colonialist players. They may be local, but they have the same extractive mindset and sometimes turn their back on the indigenous communities that they are from.”
Thanks to their scale, these estates are more visible than other smaller producers. This means they are more likely to attract investment from roasters worldwide when they are in fact the ones who need it the least.
HOW CAN PRODUCERS TAKE BACK OWNERSHIP OF THEIR COFFEE?
There are no quick solutions; that much is clear. However, the people I interviewed suggested some courses of action.
CHANGE YOUR MINDSET
How do you change a way of thinking and acting which is so deeply ingrained in society? Phyllis says: “It’s a desire and an interest to act. It’s changing your priorities, how you look at people and how you operate. It’s accepting the system might be flawed.”
She says that asking hard questions is a big part of the journey: “Why, for instance, in Papua New Guinea, does not one indigenous person own the exporter’s licence for coffee?” Phyllis stresses the importance of closely examining the systems we have come to consider as normal.
TALK ABOUT THE ISSUES
Martin is very vocal on the topic of inequality in the coffee sector, and passionate about empowering producers. He tells me that that change starts with recognising the issues and openly discussing them, even if they are uncomfortable topics.
“We can’t, as an industry, talk about wanting change, but then avoid the biggest topics that exist. We have to understand the root cause and eliminate it,” he says.
Furthermore, a significant barrier to long-term, sustainable change in the coffee industry is that making these huge changes takes a lot of time and resources, not to mention adaptation from all stakeholders. For more established actors in the coffee sector, this might not be a route they are willing to take.
“We need them to understand and we need to bring the reality to light for them,” Martin says.
RECOGNISE THE VALUE OF COFFEE
With the emergence of specialty and third-wave coffee, the industry has come to realise that coffee has varying degrees of quality. As we know, this depends largely on the circumstances and effort at production level.
This differentiates coffee from other commodities – yet it largely continues to be traded as a commodity, with little reward or recognition for many producers.
For Martin, the way forward is simple: establish producer-run coffee mills at origin, and treat coffee as a product of good value. He says that paying a price that reflects this value, a wider focus on quality, and investment in infrastructure for coffee-growing communities will all support people to recognise the value of coffee.
“If you truly want to add value for coffee producers, you need to treat them as people first and producers second. You need to understand their needs and the needs of their community.”
Colonial structures and dynamics are deeply ingrained in the coffee sector. For many actors in the supply chain, they are just part of what we consider to be normal. However, these continue to exist along the coffee value chain today and often keep coffee producers from success and growth.
To move forward as a global industry, we need to re-examine what we consider to be normal and fair, for both the producer and the industry. A collective shift in mindset is an essential first step.
There does seem to be hope ahead, as movements designed to empower those affected by these structures gain momentum worldwide. People are starting to think – and act – on ways to achieve real change.
Photo credits: Fairtrade Africa, Meklit Mersha, Mayorga Organics
Source: Perfect Daily Grind