• Coffee fungus gives industry jitters
    By Gayle Hanson
    staff writer | April 22,2013
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    Stefan Hard / Staff File Photo An aerial view of the Green Mountain Coffee Roasters campus in Waterbury.
    If you are enjoying a cup of Central American organic fair trade coffee, take a minute to savor it. A rampant disease spreading throughout the region may soon make it an increasingly rare commodity.

    This past weekend Green Mountain Coffee Roasters co-sponsored an international gathering of government officials, scientists, nongovernmental organizations, suppliers and producers in Guatemala for what was called “an emergency summit” to discuss the humanitarian and economic devastation that may result from the spread of coffee leaf rust. This airborne fungus is expected to destroy as much as 40 percent of this year’s crop in the entire region, and 65 percent during the 2014 harvest season. It’s also likely to worsen.

    The governments of Guatemala and Honduras have each declared a state of emergency, with Guatemala predicting that it will lose close to 70 percent of its crop this year. It is estimated that a half-million farms, and millions of individual livelihoods, have already been affected in a region where coffee can represent more than 25 percent of employment.

    Green Mountain Coffee Roasters is one of the nation’s largest coffee roasters and in 2012 became the largest purchaser of Fair Trade Certified coffee. While it now sources its beans from 33 regions globally, it has a longstanding supply chain reaching deep into the mountains of Central America and Mexico.

    In Guatemala it was joined at the table by its partners and competitors, including Starbucks, Folgers, the U.S. Department of Agriculture, the United States Agency for International Development, or USAID, and various Central American stakeholders to figure out how to address the growing crisis.

    At the end of the day, said Lindsey Bolger, GMCR’s senior director of coffee, this is a problem that any farmer could relate to.

    “This is a problem that our farmers in Vermont can understand,” said Bolger. “We have such strong relationships with our growers. They are our farmers market and like many Vermonters we know our farmers.”

    To that end GMCR has been working to survey its suppliers, the better to understand how the crisis is affecting them.

    “What we are certain of is that this is a multi-year challenge,” said Bolger. “While the picture isn’t really clear for next year, the broader implication is that we are looking at something that is going to continue.”

    There’s no single cause for the rust epidemic, say the experts, but rather it’s the outgrowth of climate change, aging plant stock, and antiquated farming practices that makes this particular outbreak so devastating. It has also come at a time when the coffee-growing regions of Brazil and Vietnam have increased their production, helping to cause the global price for beans to plummet.

    There are two types of coffee beans, arabica and robusta. The arabica bean, considered to be the superior because of its more refined taste, is the bean most farmed throughout the Americas and the bean most susceptible to leaf rust. Arabica coffee represents 70 percent of all coffee in production and is the main component in high-quality coffee. While robusta plants will also develop the disease, strains of resistant robusta beans have been developed successfully.

    The USAID-funded Famine Early Warning Systems Network says that because 90 percent of all coffee grown in the region is exported, it is vulnerable to global price fluctuations, thus endangering the livelihood of the region’s poorest laborers. Despite a record export high of 113.1 million exported bags in 2012, up 8 percent from the prior year, the price per pound has fallen 30 percent from more than $2 to approximately $1.30, according to the International Coffee Organization’s composite indicator.

    Climate change throughout the Central American region has also produced consecutive years of overly abundant rainfall at higher than usual altitudes, creating an optimal environment for the fungus, which spreads rapidly in the moist regions of the highlands, according to experts at World Coffee Research. Like Vermont, it is a region of micro-climates where temperatures and growing seasons can shift from one valley to the next.

    Although coffee leaf rust will respond to some fungicides, they are not really that effective, and are not, of course, an option for organic growers.

    “What is confounding about this fungus is that it doesn’t follow natural behaviors,” says Bolger. “We know that it needs a warm, moist environment and we know that it spreads through the wind. We also know that one worker can spread it from one farm to the other.”

    Bolger added that she was aware of some organic coffee plantations that had been decimated, while others are getting by relatively unscathed. “We are hearing a lot of different narratives,” she said.

    Michael Sheridan has been working in the coffee lands region for several years for Catholic Relief Services, which has surveyed more than 13 cooperatives and 6,800 farmers in the region, and has questioned growers in particular about the impact on organic farms.

    “I think the most common response was that the impact of coffee rust on production depends less on whether growers use organic or conventional technologies and more to do with how well they manage their farms,” he said. “In some cases conventional technologies were better in controlling coffee rust. In other cases organic approaches were more effective. One of the challenges all farmers face now is beating back the fungus once it has taken hold... People I have spoken with who know coffee rust suggest that in this case an ounce of prevention is worth way more than a pound of cure.”

    Last year GMCR increased its purchase of fair trade coffee by 5 million pounds and announced that one of its most popular blends would be 100 percent Free Trade Certified. The Nantucket Blend consists of coffee from Central America, South America, Africa and Indonesia.

    Analysts say that should the blight continue, coffee blends across the board might shift in flavor profiles due to the necessity of sourcing beans from alternate regions.

    “I think that you could see some change in the way blends are formulated,” said Peter Scoville, a commodities analyst and vice president for Chicago’s Cole Group. Scoville added that GMCR, with its diverse product line and access to suppliers around the globe, would be unlikely to be harmed in the long term by the problem.

    “I don’t think that there is anything here that is going to affect the share price,” he said. “After all they do have the Keurig.”

    For its part, GMCR has poured millions of dollars into sustainability research and humanitarian aid in the coffee regions where it operates. The company is widely respected for having greatly improved the conditions under which coffee is grown, supporting small local fincas and encouraging sustainable farming practices and better working conditions for laborers.

    Last year it purchased more than 50 million pounds of fair trade coffee and made $10 million in direct grants to help improve the situation for the farmers in its supply chain. It has partnered with USAID, and the global humanitarian agency Mercy Corps, to provide funds to the Feed the Future Initiative in Guatemala, which works to alleviate poverty and malnutrition in the region.

    “We are always going to have a significant presence in this region,” says Bolger. “We are sitting at the table with our competitors because we share common interests. It’s like when Irene hit. We’re going to work together to try and fix this. I feel that we are not just representing ourselves here, but all of Vermont’s roasters, large and small.”
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