With coffee the second most commonly traded commodity globally, the sector is investing 350M USD annually in a variety of sustainability efforts both directly and indirectly, as well as address the over-arching need for a holistic approach to the future of the coffee business model.
By understanding the associated costs, minimising unnecessary complexity and committing to sustainability, we can see that sustainability performance is influenced by two predominant value chain factors – Farming (Production) and Consumption.
Production
Economic viability is the catalyst for the sustainability of the entire coffee sector. With prices and exports declining, it’s even more relevant that coffee companies partner with farmers and improve relationships, becoming resource-efficient through focussing investment, sustaining supply, conserving nature, improving livelihoods (particularly for women, who grow the majority of the world’s rural agricultural food stock), and improving communication.
Ventures such as Fair Trade and the Rainforest Alliance, along with the majority of the top 10 roasters (roughly 35% of market share), have industry standards and commitments to achieve this viability (e.g. fair wages for all), but how does coffee impact the environment before it reaches our (*reusable*) cups?
Arabica and Robusta are grown in tropical regions (Brazil, Vietnam, Colombia, Indonesia, and Ethiopia being the ‘big 5’), with Brazil being the largest (since introduced by the Dutch in the 17th century, who initially brought coffee plants to Suriname), supplying roughly 3m metric tonnes per annum, collaboration with farmers is vital.
With deforestation under Brazilian President Jair Bolsonaro reaching a record high in Brazil, there is a major impact on coffee (as well as other agriculture) as a result of land degradation, repurposing and subsequent weather impact (with less trees, the water cycle is impacted resulting in higher temperatures, less rainfall and drier ground causing run off and divesting soil of it’s nutrients) adversely impacting local ecosystems.
Improving the Future – land, energy, science
Optimising the available space by planting cash and food crops (e.g. banana plants) and stopping pesticide use, not only shades coffee plants, but improves soil quality, prevents degradation and improves carbon capture, as well as less runoff pollution into local water aquifers.
Coupling this with renewable energy use and recycling on farms (e.g. wind, solar, irrigation and turning vegetative waste into biogas where possible) would lead to increased yields, improved consistency and a lower environmental impact.
Another key development is increasing the durability of plant species – 60% of wild coffee species are endangered as a result of their limited habitats and aforementioned land-use. Investing in scientific innovation and supporting conservation efforts will further the crop diversity and ensure future crop stability.
Educating farmers and providing the resources to improve crops and land use will sustain supply and deliver lasting benefits, with the knock-on effect resulting in more ethical production as coffee companies and their farmers further develop understanding of the efforts surrounding sustainable growth, fostering prosperity for them and their families.
Consumption – waste, energy, communication
The growing consumer demand for sustainable goods, volatility of commodity prices and costs of production leads to a variety of environmental and societal impacts as we have seen.
With a cup of coffee being subject to regional and national price differences, due rent, wages and economies of scale, a number of choices can be be made to nudge consumers to your shop or cafe, with energy, waste and communication being the most feasible direct improvements.
Of course, the biggest and most impactful improvement is to ban single use cups in-store (as well as all single-use plastics, sachets and anything in a wrapper – looking at you Lotus biscuits). Though harmful to profit, banning these altogether in favour of reusable cups (either given, offered for sale or brought in by customers) is the most environmentally friendly choice. Appreciating this isn’t necessarily feasible, what else can we look at?
Switching to renewable energy use in-store and improving lighting will not only improve the carbon footprint, but lower business costs. Upgrading machinery will have a similar effect, by using less energy and water (one of the biggest impacts being machinery left on standby when not in use)
There is a significant movement to recycle coffee grounds, with an array of uses from skincare to compost and biomass becoming ever more popular (as a biomass fuel product, coffee waste potentially saves 6.8 tonnes of CO2 emissions per tonne of waste coffee grounds recycled, as well as creating a closed loop energy supply chain). Furthermore, there has been a rise in the use of coffee grounds as fibres for clothing, resulting in opportunities for the development of circular economies across the sector.
How to sell this good news? Well, train staff to utilise new systems, buy-in to energy efficiency and as the face of the business, sell this to customers. With global coffee consumption steadily growing at a healthy annual rate of 2.2%, improving consumer transparency is a key opportunity to improve overall industry sustainability and create value chain improvements.
Promotion and marketing in-store and across social media, engaging with customers and offering sustainable products (and discounts for using them), companies can influence behaviour – something as simple as creating an app offering information regards coffee origins and rewards, goes a long away to improving processes, growth, brand image and attracting new customers.
In doing so, further opportunities can be sought and accommodated (e.g. sustainable packaging and carbon offsetting) advocating companies to improve their business model by looking at coffee as a whole – reducing environmental risks, increasing transparency, strengthen stewardship and focussing on customers across the value chain, delivering sustainable growth and sustainable profits across the coffee industry.
