STiR coffee and tea magazine

16 STiR coffee and tea / Issue 6, 2019 (December / January 2020) Q&A STiR: Where do we stand on the problem with pricing in the coffee industry? Anil Kumar Bhandari: Globally, prices of arabica are at a historic low, caused by an overhang of surplus coffee. The estimated surplus is 5-7 million 60 kg bags. The prices devolving to the farmer are severely depressed. There are 25 million farmers in 70 countries who are feeling the brunt of this. On the other hand, coffee consumption is in the rise, increasing 2.5-3.0% globally, and in Asia growing at 6%. Retailers and roasters are showing significant profits. But this does not trickle to the farmer, not with the surplus. STiR: What's the situation on the ground level? Bhandari: In the last year or two, there has been an increase in migration from coffee farms, especially in Africa and Central America. This may bring down production and address the concerns of surplus production but it can destabilize the coffee production because it directly impacts the market. If coffee farmers begin to move away from coffee, we're likely to be left with only Brazil and Vietnam standing, the two countries that produce 50% of the coffee consumed. However, if this becomes the case, quality differentiation will disappear. Discerning consumers globally are asking for niche coffees and they will be left without choices. This will spiral into a loss of opportunity and in turn, shrink the rise in consumption. STiR: How can coffee growers stay afloat? How is the industry responding to the situation? Bhandari: 95% of coffee growers are small growers and are the most vulnerable. In most countries, they are single crop farmers and it is a very stressful time for them. This is the topic of conversation at the various industry forums. In September 2019, the PCSB of the International Coffee Organization held a day-long meeting of c.e.o.s of the coffee communities. Several top companies made a presentation on how to raise farm gate prices. But this is no simple matter. Coffee cartels are against the law in many countries. Everyone is at a loss to solve this problem. But everyone's committed to finding a solution; the London Declara- tion was signed by leaders to commit to bringing the coffee industry to sustainable levels. A task force of producers and roasters has been set up to evolve a plan of action and a strategy before we meet again in September 2020 for the next World Coffee Congress. Anil Kumar Bhandari is a second-generation coffee grower from Karnataka, India. He has served the Indian plantation industry in various capacities since 1979, including 13 years on the managing committee of the United Planters Association, the apex multi-Plantation Commodity Organization for Southern India. He served as president in 2004-05. Bhandari was the initiator of the India Coffee Trust, a non-profit multi stakeholder coffee body dedicated to serving the Indian coffee industry. He is also credited with establishing the India International Coffee Festival. In 2018, Bhandri was elected as chairman of the Private Sector Consultative Board (PCSB) of the Interna- tional Coffee Organization, the first Indian to hold this post. He also chairs the steering committee of the 5th World Coffee Conference in Benga- luru in 2020. Here he talks about global coffee concerns. Q A By Aravinda Anantharaman Anil Kumar Bhandari

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