Ethiopia - Coffee Crisis
June 2003 - 10 min 00 sec
REPORTER: David Brill: It's 6am in the village of Haro and Abanega Aba Negaa starts his day in the only way he can afford - a cup of strong coffee and a few mouthfuls of Akaawee, a sort of sorghum popcorn. At 60 years old, he's been a coffee farmer all his life, and he's never known things this bad.
ABANEGA, COFFEE FARMER (Translation): We have no future. We even plan to sell our house.
Iya is his third wife, and between them they have eight children. They can only afford to keep two of them at home - the others have to live with relatives in town.
ABANEGA: The drop in coffee prices is a big problem for us. We can no longer support our children. We've sent them away to stay with relatives.
Every day, Abanega and Iya head off to tend their tiny coffee plantation. In this part of Ethiopia, 85% of the people rely on coffee as their only source of income. Like their neighbours, they know that going to work each day is hardly worth the effort. If he's lucky, Abanega will get 600 kilos of the prized red cherries, or raw beans from his trees.
ABANEGA: This green berry should not be picked till there's been rain. If there's been no rain, then it is no good. When it rains, the berry turns red. Then it's ready to be picked.
At current prices, their crop from an entire year's work will earn them about $10. Even in Ethiopia, that's nowhere near enough, even for the basics.
IYA, ABANEGAS WIFE (Translation): We have no other means of income. We rely on the money we earn from coffee for all our needs. If the coffee price remains unchanged, we'll simply have no life. Can you make bread out of coffee powder? Or salt?
Iya and Abanega are just 1 of the 1.2 million families growing coffee in Ethiopia. They are all in such desperate straits that the aid agency Oxfam has launched an international campaign to confront what it's termed the coffee crisis.
IBERA: We have to consider other work...
The Ethiopian director of the campaign is Ibera. He's taking us to the Kafa province, just to the west of the Great Rift valley, which is widely recognised as the birthplace of the world's most popular drink.
IBERA: This is the birthplace of coffee. They are keeping, you know, this historical place for us. People come here and visit and talk to them and so this is precious for us.
REPORTER: Are these coffee farmers, are they still producing coffee?
IBERA: They are still producing coffee and we are asking, for example, you know, there is a crisis, why are they producing coffee? They are saying that coffee's our culture, coffee's our identity.
REPORTER: Right, so let's go.
IBERA: Yes, please.
The legend is that a thousand years ago in this very forest, a shepherd noticed his goat was happier after eating the coffee berries and tried some himself, starting the world's most widespread addiction. Wild coffee still grows all over the forest.
IBERA: This is wild coffee and, as you see, it grows under this very big, very big trees and it doesn't need any fertiliser or any pesticide or anything else. Just grows like this.
REPORTER: Is it good quality coffee?
IBERA: It's very good quality coffee. Very excellent.
All of these farmers know nothing but coffee. They've grown little else for generations. But now the returns are so low, they simply cannot survive.
MALE, FARMER #1 (Translation): The clothes we're wearing are eight or nine years old. Back then, we had a better return for our coffee. Now it's hard to get enough food. We can't worry about clothes. Our lives are ruined, miserable.
MALE FARMER #2 (Translation): We have been growing coffee for more than 820 years. But generation after generation, our life has deteriorated. We don't benefit from this coffee.
FARMER #1: We have no food to eat. Our community is starving.
IBERA: At this particular time, they have nothing to eat, nothing to eat, and they are asking the government and the donor organisations really to be supported, you know, to be, to get, you know, some supplementary food or food aid.
This crisis has arisen because the world price for coffee has collapsed. These farmers receive less than 15 cents a kilo for their raw berries, a fall of 70% in just the last four years. And the tragedy is there's nothing they can do about it. The International Coffee Organisation, or ICO, which regulated prices, collapsed over a decade ago leaving coffee farmers at the mercy of the big buyers.
IBERA: More than 50% of the coffee market is dominated by five or four multinational corporations. So they are the price makers, you know, the farmer is not the price maker. You know, the roaster gives the price. So the farmers take the price that the multinational corporations give for the coffee market. Again, you know, there is no other organisation or like OPEC for oil, the ICO is already out, and there is just no organisation which will follow up on the price of coffee. In Australia, a cup of coffee costs 24 birr. Yet you get nothing much. How do you feel about that?
FARMER #1: I feel bad. Those people with means make money from our sweat. We farmers are the ones who work very hard. We plant and grow the coffee. We prepare the coffee for the market. Yet others make profits and we are denied our fair share. All we get for our hard work is starvation, misery and death. It is not fair.
ABANEGA: What they're doing is simply looting. That's unacceptable. It's unacceptable both on earth and in heaven. It is vicious and immoral by any community standard.
Supporters of globalisation suggest that the market will sort out these difficulties. The theory goes that when the price of coffee falls at the auction houses in Addis Ababa, then the farmers should get out of the business of growing coffee and start growing something else - a crop they can make a decent living from. But those who understand the market, and know the reality of life on the coffee farms, say this is plainly impractical.
JEFF ATKINSON, TRADE CO-ORDINATOR, OXFAM: It's not easy for coffee growers to get out of the market even though the price is so low. In Ethiopia, for example, the land holdings are too small, the land quality is too poor for them to change over to food. So, in a sense, they're caught in a trap and also to change over to another cash crop means years and years of waiting before that cash crop is ready to sell and many poor families just don't have the option of waiting that long so they're stuck in a bit of a trap.
The end result of this trap is that Ethiopia continues to produce mountains of coffee. Ethiopians are intensely proud of their reputation for good quality coffee and each batch is brewed and tasted to grade it for export. But the whole industry is being slowly strangled by the coffee crisis. Farmers, roasters, tasters, exporters have all seen their income collapse. It's now having an effect on the national economy.
JEFF ATKINSON: In terms of the economy as a whole, of course, it's been catastrophic. For the Ethiopian Government itself, which has to pay for schools and health clinics, it's lost revenue. Something like 10% or 20% of the Ethiopian Government's revenue comes from the sale of coffee, and, of course, that's plummeted as well. So that's less funds available for schools, for health clinics, for roads, etc, etc.
Ethiopia is already one of the poorest nations on earth. It rarely registers on the developed world's agenda unless a natural calamity like a drought pricks the world's conscience with pictures of millions facing starvation. The coffee crisis is slowly but surely having the same impact. But this tragedy is entirely man made.
REPORTER: DAVID BRILL EDITOR: WAYNE LOVE
June 2003 - 10 min 00 sec
REPORTER: David Brill: It's 6am in the village of Haro and Abanega Aba Negaa starts his day in the only way he can afford - a cup of strong coffee and a few mouthfuls of Akaawee, a sort of sorghum popcorn. At 60 years old, he's been a coffee farmer all his life, and he's never known things this bad.
ABANEGA, COFFEE FARMER (Translation): We have no future. We even plan to sell our house.
Iya is his third wife, and between them they have eight children. They can only afford to keep two of them at home - the others have to live with relatives in town.
ABANEGA: The drop in coffee prices is a big problem for us. We can no longer support our children. We've sent them away to stay with relatives.
Every day, Abanega and Iya head off to tend their tiny coffee plantation. In this part of Ethiopia, 85% of the people rely on coffee as their only source of income. Like their neighbours, they know that going to work each day is hardly worth the effort. If he's lucky, Abanega will get 600 kilos of the prized red cherries, or raw beans from his trees.
ABANEGA: This green berry should not be picked till there's been rain. If there's been no rain, then it is no good. When it rains, the berry turns red. Then it's ready to be picked.
At current prices, their crop from an entire year's work will earn them about $10. Even in Ethiopia, that's nowhere near enough, even for the basics.
IYA, ABANEGAS WIFE (Translation): We have no other means of income. We rely on the money we earn from coffee for all our needs. If the coffee price remains unchanged, we'll simply have no life. Can you make bread out of coffee powder? Or salt?
Iya and Abanega are just 1 of the 1.2 million families growing coffee in Ethiopia. They are all in such desperate straits that the aid agency Oxfam has launched an international campaign to confront what it's termed the coffee crisis.
IBERA: We have to consider other work...
The Ethiopian director of the campaign is Ibera. He's taking us to the Kafa province, just to the west of the Great Rift valley, which is widely recognised as the birthplace of the world's most popular drink.
IBERA: This is the birthplace of coffee. They are keeping, you know, this historical place for us. People come here and visit and talk to them and so this is precious for us.
REPORTER: Are these coffee farmers, are they still producing coffee?
IBERA: They are still producing coffee and we are asking, for example, you know, there is a crisis, why are they producing coffee? They are saying that coffee's our culture, coffee's our identity.
REPORTER: Right, so let's go.
IBERA: Yes, please.
The legend is that a thousand years ago in this very forest, a shepherd noticed his goat was happier after eating the coffee berries and tried some himself, starting the world's most widespread addiction. Wild coffee still grows all over the forest.
IBERA: This is wild coffee and, as you see, it grows under this very big, very big trees and it doesn't need any fertiliser or any pesticide or anything else. Just grows like this.
REPORTER: Is it good quality coffee?
IBERA: It's very good quality coffee. Very excellent.
All of these farmers know nothing but coffee. They've grown little else for generations. But now the returns are so low, they simply cannot survive.
MALE, FARMER #1 (Translation): The clothes we're wearing are eight or nine years old. Back then, we had a better return for our coffee. Now it's hard to get enough food. We can't worry about clothes. Our lives are ruined, miserable.
MALE FARMER #2 (Translation): We have been growing coffee for more than 820 years. But generation after generation, our life has deteriorated. We don't benefit from this coffee.
FARMER #1: We have no food to eat. Our community is starving.
IBERA: At this particular time, they have nothing to eat, nothing to eat, and they are asking the government and the donor organisations really to be supported, you know, to be, to get, you know, some supplementary food or food aid.
This crisis has arisen because the world price for coffee has collapsed. These farmers receive less than 15 cents a kilo for their raw berries, a fall of 70% in just the last four years. And the tragedy is there's nothing they can do about it. The International Coffee Organisation, or ICO, which regulated prices, collapsed over a decade ago leaving coffee farmers at the mercy of the big buyers.
IBERA: More than 50% of the coffee market is dominated by five or four multinational corporations. So they are the price makers, you know, the farmer is not the price maker. You know, the roaster gives the price. So the farmers take the price that the multinational corporations give for the coffee market. Again, you know, there is no other organisation or like OPEC for oil, the ICO is already out, and there is just no organisation which will follow up on the price of coffee. In Australia, a cup of coffee costs 24 birr. Yet you get nothing much. How do you feel about that?
FARMER #1: I feel bad. Those people with means make money from our sweat. We farmers are the ones who work very hard. We plant and grow the coffee. We prepare the coffee for the market. Yet others make profits and we are denied our fair share. All we get for our hard work is starvation, misery and death. It is not fair.
ABANEGA: What they're doing is simply looting. That's unacceptable. It's unacceptable both on earth and in heaven. It is vicious and immoral by any community standard.
Supporters of globalisation suggest that the market will sort out these difficulties. The theory goes that when the price of coffee falls at the auction houses in Addis Ababa, then the farmers should get out of the business of growing coffee and start growing something else - a crop they can make a decent living from. But those who understand the market, and know the reality of life on the coffee farms, say this is plainly impractical.
JEFF ATKINSON, TRADE CO-ORDINATOR, OXFAM: It's not easy for coffee growers to get out of the market even though the price is so low. In Ethiopia, for example, the land holdings are too small, the land quality is too poor for them to change over to food. So, in a sense, they're caught in a trap and also to change over to another cash crop means years and years of waiting before that cash crop is ready to sell and many poor families just don't have the option of waiting that long so they're stuck in a bit of a trap.
The end result of this trap is that Ethiopia continues to produce mountains of coffee. Ethiopians are intensely proud of their reputation for good quality coffee and each batch is brewed and tasted to grade it for export. But the whole industry is being slowly strangled by the coffee crisis. Farmers, roasters, tasters, exporters have all seen their income collapse. It's now having an effect on the national economy.
JEFF ATKINSON: In terms of the economy as a whole, of course, it's been catastrophic. For the Ethiopian Government itself, which has to pay for schools and health clinics, it's lost revenue. Something like 10% or 20% of the Ethiopian Government's revenue comes from the sale of coffee, and, of course, that's plummeted as well. So that's less funds available for schools, for health clinics, for roads, etc, etc.
Ethiopia is already one of the poorest nations on earth. It rarely registers on the developed world's agenda unless a natural calamity like a drought pricks the world's conscience with pictures of millions facing starvation. The coffee crisis is slowly but surely having the same impact. But this tragedy is entirely man made.
REPORTER: DAVID BRILL EDITOR: WAYNE LOVE