Coffee Eco-labeling:Profit, Prosperity,& Healthy Nature?
Brian CrespiAndre Goncalves
Janani Kannan Alexey Kudryavtsev
Jessica Stern
Presentation Outline
I. Introduction • Question at hand
• Background of Coffee and Eco-labeling
II. Environmental Impacts
III. Socio-Economic Impacts• Growers and Consumers
IV. Conclusions • Future and Alternative Options
Question at Hand
Is eco-labeling of coffee an effective market incentive to promote environmentally friendly production methods?
Background • Coffee
– 2nd most traded commodity in world, next to oil
– 5.3 million tons produced globally and exported in 2002 (U.N. Food and Agriculture Organization)
http://www.jeremiahspick.com/organic.shtml
Background
• Eco-labeling – A strategy to encourage strong
environmental practices through incentives for the producer
• Price premium• Competitive advantage
– Appease pressures from environmentalists
• Future considerations (sustainability)– Future market concerns– Conservationist outlook
Eco-labeling
• Not a standard process– Third party certification
• Own criteria for certification under certain principles for different aspects i.e. organic
• Credibility is key– Gives consumer advantage
– Schemes of Coffee Labeling• Fair Trade• Organic• Shade Grown
Fairtrade
Organic
Shade-grown
Coffee Certification Schemes
• Schemes are not mutually exclusive– Many growers are certified organic,
shade grown and fair trade• Must meet criteria for each, but does not
mean being certified as one means you are or are not certified by another
Fair Trade
• Seeks to offer small farmers and cooperatives of farmers a fair price for their coffee– Ensures access to credit for farmers
among other mechanisms
• Often coexisting with stated sustainable growing practices – Modern plantation farming is not
conducive to small farmers due to high resource costs and involved methods
http://gbgm-umc.org/nwo/01so/fairtrade.html
Organic
• Grown free of pesticides, herbicides, fungicides and other chemicals– Environmental benefits
• Often coexisting with shade grown certification
• Most developed current certified coffee market
Shade Grown• Grown under a canopy
of trees– The traditional method of
growth before the modernization of coffee agriculture
– Typically yields a high-quality product with a lesser need for chemical inputs
– Most often organic also
www.coffeesearch.org/politics/shadegrown.jpg
Environmental Impacts
Traditional Modernized
Perfecto and Snelling. (1995) “Biodiversity and the transformation of a tropical agroecosystems.”In: Ecological Applications 5: 1084-1097.
• Loss of biodiversity
• Invasive species
• Soil erosion
• Deforestation
• Agrochemical pollution
• High energy demand• More yield
• Control over ecosystem
• Cheaper production
But:
Environmental Impacts
Working
landscape?
Working for people:• Food safety• Coffee + fruits + timber• Natural pests control• Stable yields
…and for nature:• No habitat lost• Conserve species• Carbon sequestration
Environmental Impacts
Socio-Economics
How far does the world-wide coffee industry extend?
Current trends affecting growers deal with -
Drive for a better profit, not a better environment
Flaws in Eco-Labeling for Growers
“In practice, small farmers need additional help and incentives to adopt the [bio-diversity friendly] certification criteria . . . Small farmers with [conventional polyculture] farms need to be presented with strategies to lower the risk of investment . . . (Gobbi, 2000).”
Flaws in Eco-Labeling for Growers
“The entry cost to organic production, even subsidized, appears to be too high for the smallest producers, but organic production is a significant option for the slightly larger producers (Bray et al. 2002).”
Pro-Certification Arguments:
Growers cannot get a premium
Big companies cannot be held accountable unless they have certification
Confidence that the coffee purchased actually serves the purpose
Ensures good scientific criteria
Helps make an informed decision
Consumers
ConsumersArguments Against Certification:
Certification price is too high
Does not control possibility of fraud
Broker should be certified
Deciding between labels becomes difficult
ConsumersThree approaches:
1. Farmers should not bear the burden of certification costs.
2. “Relationship coffee” - trading coffee through known sources; certifying brokers
3. Good quality would ascertain good premium like gourmet coffee
Figure 2: (National Coffee Association) Percentages of both awareness and total purchase of eco-labeled coffee increased from 2003 to 2004.
Consumers
Drawbacks and Failures
1. Inversion of Values
2. Cost of certification schemes• Difficult without third party support
3. Certification Methodology neglecting social relations
4. Organic norms and regulations across different landscapes
Alternative Certification Systems
Origin:
Southern and Northern countries
Reasons: • certification costs • paradigm for ensuring credibility
• more adapted system to local realities
Definition:
A process which generates credibility for the organic product based on the participation and integration of all stakeholders who have interest to guarantee the quality of the product. (Meirelles 2003)
Alternative Certification Systems
Characteristics: • Involve several stakeholders• Based on negotiated standards• Trustworthy relationships• Attempt to integrate social and environmental concerns
Examples:• Community Support Agriculture• Farmers Markets• Box schemes• Home deliveries• Popular fairs
International Workshop on Alternative Certification
One last thing . . .
We created a web site with
Our paper
Our references
Links to websites
Our PowerPoint presentation
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