A handful of Portlanders are trying to improve the coffee-growing culture
Given how easy it is to dispose of $3 for a cup of coffee in Portland, it would seem a stretch to say that the coffee market is facing a crisis.
But it is.
The root of the problem lies thousands of miles away from the $12-a-pound organic roasts and $3 double-skinny-soys of Portland. Farmers in Brazil and Vietnam are sprinting to cash in on coffee, and they are flooding the global market with low-quality beans.
'There's a lot of really bad coffee out there, and the problem is, it's being bought,' says Mike Ferguson, spokesman for the Specialty Coffee Association of America. 'Rotten oranges don't make it to the supermarket. But a lot of really bad coffee gets roasted.'
The glut has sent coffee commodity prices plummeting to below 60 cents a pound. The price has been under $1 since April 2000 and bottomed out at 41 cents in December 2001 Ñ a 100-year low when adjusted for inflation.
This makes grim news for the independent coffee growers of the tropical world Ñ those who produce the high-quality beans that Portlanders thirst for.
'People in coffee-growing country are living poorer than their grandparents did,' says David Griswold, president of Portland-based coffee importer Sustainable Harvest.
A September 2002 report by the British relief agency Oxfam warns that the crisis threatens the livelihoods of 125 million people. In Guatemala, employment in the coffee industry dropped from 500,000 jobs in 2000 to 250,000 in 2001. In Colombia, farmers are switching to a more lucrative crop: coca, the plant used to make cocaine.
And in a region of Nicaragua that Griswold recently visited, about 80 percent of coffee workers were unemployed.
Griswold, the specialty coffee group's incoming president, is part of a growing movement to reform the coffee industry with new business models. He will join coffee buyer Doug Welsh of Peet's Coffee for a multimedia presentation about the coffee crisis Thursday at the Jean Vollum Natural Capital Center, 721 N.W. Ninth Ave.
The stark poverty in far-off coffee countries hardly matches the booming market for gourmet beans at home.
The number of coffee businesses in the United States has increased from 585 in 1989 to more than 14,000 today. Revenues from the nation's specialty cafes, kiosks, coffee carts and bean roasters exceeded $10.7 billion in 2001.
It's hard to estimate numbers for caffeine-dependent Portland, but coffee experts say the city's coffee market is way above the average. Using a rough estimate based on SCAA data of $750,000 per year in sales per cafe, Portland's 200 or so retail cafes pull in about $150 million annually.
And that's not to mention the 40 firms that roast beans or sell them wholesale in and around Portland, the 30 businesses that manufacture or distribute coffee supplies, and the huge revenues from coffee sold in the city's grocery stores.
Griswold argues that it's in the coffee industry's interest to distribute the wealth more evenly. From his offices in the Pearl District, he works to arrange transparent deals between northern buyers and southern producers.
One of his southern clients is Cristina de Gonzales, a third-generation Guatemalan coffee farmer who grows shade coffee, allowing agriculture and the natural forest to coexist, and limits her use of chemicals and water.
Griswold has arranged a deal where three coffee companies agree to buy Gonzales' best beans. The buyers pay about three times the going price for the commodity, shelling out half up front, before the harvest.
Employees for the three buyers Ñ Olympia, Wash.-based Batdorf Bronson Coffee Roasters, Portland's Stumptown Roasters and Boulder, Colo.-based Allegro Coffee, the coffee buyer for Whole Foods markets Ñ have toured the Guatemalan farm. They say the face-to-face meetings help the buyers and sellers respect and understand one another, resulting in a stronger relationship and, ultimately, a better product.
It's what Griswold calls 'relationship coffee.'
Griswold founded Sustainable Harvest in 1996 and relocated from California to Portland in 2000. His company's revenues were $4.2 million last year.
Griswold says he still believes in the ideals of the nonprofit world, but 'when you can make a profit, it's a really powerful model. It's the most efficient way there is to create change.'
That change appears to be on its way. A decade ago, there was only one company selling so-called 'fair trade' coffee, the Boston-based for-profit worker cooperative Equal Exchange. Today there are more than 100.
'For years, people said either there isn't a problem or that customers wouldn't be interested in our solution, or it wouldn't work,' says Equal Exchange spokesman Rodney North. 'Now we know that it is a problem, and people are interested in a solution that brings them good coffee that they can feel good about. And it does work.'
Equal Exchange's revenues were $10.4 million last year, the 14th year out of 15 that the company turned a profit.
That success has not gone unnoticed.
Starbucks, the double-tall giant of the gourmet coffee industry, with more than 80 cafes in the Portland area, today offers four types of 'sustainable' coffee: fair trade, organic, farm direct and conservation.