The View

We have now turned the corner on the first round of industry tradeshows. Starting with Coffee Fest – NY, through the National Coffee Association, The SCAA, and the NAMA OneShow we have been bombarded with new ideas and information. In truth, much of what we think about over the coming year is either directly or indirectly a result of something we found out during these shows. Every now and then there is one of those “Well…Duh!” moments when I see something that has been right in front of me for years – something obvious that I finally caught on to.
I have a little philosophy about learning and age, when we folks of a certain age can no longer remember things from ‘the ago’, we often find this worrisome; not me! Instead, I think that in my middle age, my brain is finally dumping all those black or white “absolutes” that so define the fragile pride and self-esteem of those folks starting on the path across the clearing called ‘a career.’ Whereas before I was determined to design my world and businesses around the things I was certain I knew, now I strive to explore and design my future, and the future of our businesses, using tools and ideas that I have discovered which I never knew existed.
ASo, I shouldn’t be too surprised when, in a conversation at the Cafe de Costa Rica SCAA booth with Mario Arroyo, I was caught completely off guard by an idea within a system I thought I pretty much knew completely – the Costa Rican Law Number 2762 enacted in 1933 that ensures fair pricing for coffee along the entire in-country supply chain. The part that surprised me was so obvious that it was truly a ‘duh’ moment. Every mill, regardless of size, has a metal box called a fanega into which the growers pour their cherries, instead of weighing their bags as in most countries. Farmers are paid by the number of fanegas they deliver the mill.
One of Mario’s presentation slides happened to show the difference in volume between fully ripe cherries, mixed ripe and unripe, and all unripe. The difference in volume was amazing. Then it hit me, the fanega system in Costa Rica was able to reward quality with a clear and quantifiable method – the more fully ripe coffee a farmer brought to the mill, the more fanegas he filled and the more money he made. Farmers who are not as careful and have a lot of unripe cherries make substantially less money for the same (approximately) weight because they fill fewer fanegas!
Brilliant! Such a simple and elegant method of incentivizing farmers to focus on quality. What a great way to reward care in picking and handling – cash.
So, my next question obviously was…why is Costa Rica the only country that requires the use of fanegas by government mandate and penalty of law?
I think that the answer touches the ugly dark grey area of sustainability. Any effort to develop a sustainable economic system in the coffee lands inevitably requires that farmers be paid more. As the President of Honduras said in Portland at the SCAA, ensuring that farmers are paid more for their coffee distributes much needed cash across a wide spectrum of rural communities and the small businesses that serve them. More cash for farmers means greater prosperity in underserved rural communities around the world. Coffee is unique as a consumed product because of the extraordinarily wide universe of beneficiaries who financially depend on the price of coffee for survival.
True sustainability cannot be achieved without the unambiguous determination on the part of consuming countries to pay more for coffee at the farm level. As long as the only skin in the game is money, then the buyers will never allow a system such as exists in Costa Rica to become universal. When trader companies believe that there is more to business than the economic bottom line alone, then and only then, will a truly sustainable business system be possible.
It all seems so obvious.
Kerri & Miles

Suggested Reading