STiR coffee and tea magazine

36 STiR coffee and tea / Issue 2, 2019 (April / May) By Dan Shryock milio Garcia, a fourth-generation Honduran coffee farmer, acutely under- stands the current coffee pricing crisis. He and his family produce as much as 75,000 pounds of green coffee each year and they need to get the best possible price for their crop. The current economic climate, however, does not favor of Garcia and other spe- cialty coffee farmers around the world. The C-market price – the benchmark for coffee commodity trading – hovers near $1 per pound, a figure so low that farmers struggle to sell their beans at prices high enough to cover their operating costs. The situation is so severe that the Specialty Coffee Association (SCA) established the Coffee Price Crisis Response Initiative. Headed by former SCA executive director Ric Rhinehart. The initiative is structured to better understand and identify solutions involving price discovery for the specialty coffee industry. "We're also looking to fully understand where we can apply efforts to change," Rhinehart told STiR coffee and tea magazine. "We want [to create] a menu of things that cof- fee buyers might do to change the current dynamic. I personally anticipate the solutions will be divergent between the specialty coffee sector and [the] regular coffee [sector]." While called a price crisis, it is not strictly an issue of dollars, Rhinehart said. "It's not a problem of low price. It's a problem fundamental to the market mechanism. Buy- ing power outstrips selling power in every occasion." The solutions may lie in transparency and what Rhinehart calls price discovery mechanisms. If roasting companies know how their green bean dollars are distributed between the importer, the middle men, and the farmer, they can make more informed purchasing decisions. "Where does the money go? How much goes to the farmer? It's not only OK for a roaster to ask," he said. "It's imperative." Rhinehart stressed transparency. "It's incumbent on the roaster to know how much of the price they pay gets to the farmer. They must insist to vendors that the vendors show the price." Paying Fair Prices for Quality Coffee E Sorting beans at Dukunde Kawa Cooperative, a Sustainable Harvest partner in Rwanda

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