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Coffee producers

Small-scale producers are responsible for producing more than half of
the world’s coffee beans. Most producers grow on less than 10 acres
of land. It takes up to three years for a coffee tree to producer 2,000
cherries, which is only enough to make a single pound of roasted
coffee. Prior to the current coffee “bubble,” producers could expect
to receive as little as 50 cents per pound of coffee.

Coffee is the world's second-most-valuable commodity exporting by
developing countries, after oil. The global coffee industry earns an
estimated $70 billion annually. Less than 10 percent of those
earnings end up in the hands of coffee farmers. Of an estimated 70
million coffee farming families, over half live in poverty.




Coffee Intermediaries or Coyotes

Coffee intermediaries or “coyotoes” may be involved in many aspects
of the supply chain. They may buy coffee at any stage between
coffee cherries and green beans, they may do some of the primary
processing, or they may collect together sufficient quantities of coffee
from many individual farmers to transport or sell to a processor,
another intermediary, or to a dealer. There may be as many as five
intermediary links in the chain. Intermediaries offer credit at high
interest rates and transportation to collection centers. Coffee
producers are often at the mercy of intermediaries for accessing both
the market and current information
Intermediaries can consume up to 10% of coffee’s total cost.




Coffee Processing

Coffee berries and their seeds undergo several processes before they
become the familiar roasted coffee. After picking, green coffee is
processed, often via what is known as the wet process method,
which incorporates fermentation of the beans. Coffee is then washed,
dried and sorted. While many major industrial operations have
mechanized much of this process, a significant amount of coffee
processing is done by hand in coffee producing countries. Coffee
processing workers generally receive minimum wage or less, with no
benefits.




Coffee brokers facilitate transportation and export of coffee to
importing countries. Brokers in coffee exporting countries often
maintain monopolistic control over the supply chain, often excluding
small producers and processors. While brokers are a necessary
component to the conventional coffee market, brokers take a
disproportionate share of the coffee price, up to 10% of final cost,
relative to the value added.



Coffee Roasters

Four major conglomerates -- Nestlé, Philip Morris, Procter & Gamble,
and Sara Lee -- dominate world coffee markets, accounting for 60
percent of U.S. sales and 40 percent of the global coffee trade.
Roasters receive up to 70 cent of every dollar spent on coffee in the
United States. While the “Big 4” coffee roasters have coffee codes of
conduct, only an extremely small percentage of their total coffee
sales certified by a third party certifier.



Coffee Distribution
8 companies control approximately 65 percent of major food
distribution in the United States. Approximately 25 percent of food
service distribution workers are unionized, while the remaining
truckers and warehouse workers receive minimum wage with virtually
no healthcare or other benefits. Food service providers, like Sodexo,
have come under fire for paying low wages, offering inadequate
access to affordable health care, wage theft and ongoing allegations
of discrimination,


Baristas and Restaurant Workers

The food retail sector, including coffee baristas, make up one of the
largest industries in the United States, employing approximately 14
million people in 2009. A recent study by the Restaurant Opportunity
Center found:

89.7% of workers surveyed did not have health insurance provided
through their employer
79.4% of workers surveyed did not have paid vacation days
87.7% of workers surveyed did not have paid sick days
63.7% of workers surveyed worked while sick
46.3% of workers surveyed suffered from overtime violations
28.0% of workers surveyed of those being passed over for a
promotion reported that it was based on race

Starbucks baristas earn on average $8 per hour, are universally part-
time employees, and thus ineligible for the company’s health care
plan. Starbucks insures a lower percentage of its workforce than Wal-
Mart at Starbucks’ 42%.

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Leveraging Institutional Dollars for a Just and Healthy Food System -Coffee producers

  • 1. Coffee producers Small-scale producers are responsible for producing more than half of the world’s coffee beans. Most producers grow on less than 10 acres of land. It takes up to three years for a coffee tree to producer 2,000 cherries, which is only enough to make a single pound of roasted coffee. Prior to the current coffee “bubble,” producers could expect to receive as little as 50 cents per pound of coffee. Coffee is the world's second-most-valuable commodity exporting by developing countries, after oil. The global coffee industry earns an estimated $70 billion annually. Less than 10 percent of those earnings end up in the hands of coffee farmers. Of an estimated 70 million coffee farming families, over half live in poverty. Coffee Intermediaries or Coyotes Coffee intermediaries or “coyotoes” may be involved in many aspects of the supply chain. They may buy coffee at any stage between coffee cherries and green beans, they may do some of the primary processing, or they may collect together sufficient quantities of coffee from many individual farmers to transport or sell to a processor, another intermediary, or to a dealer. There may be as many as five intermediary links in the chain. Intermediaries offer credit at high interest rates and transportation to collection centers. Coffee producers are often at the mercy of intermediaries for accessing both the market and current information Intermediaries can consume up to 10% of coffee’s total cost. Coffee Processing Coffee berries and their seeds undergo several processes before they
  • 2. become the familiar roasted coffee. After picking, green coffee is processed, often via what is known as the wet process method, which incorporates fermentation of the beans. Coffee is then washed, dried and sorted. While many major industrial operations have mechanized much of this process, a significant amount of coffee processing is done by hand in coffee producing countries. Coffee processing workers generally receive minimum wage or less, with no benefits. Coffee brokers facilitate transportation and export of coffee to importing countries. Brokers in coffee exporting countries often maintain monopolistic control over the supply chain, often excluding small producers and processors. While brokers are a necessary component to the conventional coffee market, brokers take a disproportionate share of the coffee price, up to 10% of final cost, relative to the value added. Coffee Roasters Four major conglomerates -- Nestlé, Philip Morris, Procter & Gamble, and Sara Lee -- dominate world coffee markets, accounting for 60 percent of U.S. sales and 40 percent of the global coffee trade. Roasters receive up to 70 cent of every dollar spent on coffee in the United States. While the “Big 4” coffee roasters have coffee codes of conduct, only an extremely small percentage of their total coffee sales certified by a third party certifier. Coffee Distribution
  • 3. 8 companies control approximately 65 percent of major food distribution in the United States. Approximately 25 percent of food service distribution workers are unionized, while the remaining truckers and warehouse workers receive minimum wage with virtually no healthcare or other benefits. Food service providers, like Sodexo, have come under fire for paying low wages, offering inadequate access to affordable health care, wage theft and ongoing allegations of discrimination, Baristas and Restaurant Workers The food retail sector, including coffee baristas, make up one of the largest industries in the United States, employing approximately 14 million people in 2009. A recent study by the Restaurant Opportunity Center found: 89.7% of workers surveyed did not have health insurance provided through their employer 79.4% of workers surveyed did not have paid vacation days 87.7% of workers surveyed did not have paid sick days 63.7% of workers surveyed worked while sick 46.3% of workers surveyed suffered from overtime violations 28.0% of workers surveyed of those being passed over for a promotion reported that it was based on race Starbucks baristas earn on average $8 per hour, are universally part- time employees, and thus ineligible for the company’s health care plan. Starbucks insures a lower percentage of its workforce than Wal- Mart at Starbucks’ 42%.