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FNC calls for action on falling coffee prices

On 27 August, representatives of coffee production in Brazil and Colombia met to discuss the falling world coffee prices, economic imbalance within the production chain, and actions to be taken.

Currently, international coffee prices are below production costs, jeopardising the economic sustainability and survival of 25 million coffee families worldwide.

“A major concern are the external factors that negatively affect the international prices and producers, such as the financial speculation of actors outside the chain, who, in a constant and perverse way pressure coffee prices, forcing migratory movements motivated by poverty and the expansion of illicit crops in some countries,” the Colombian Coffee Growers Federation (FNC) says in a statement.

“The holders of coffee stocks have a greater influence on the formation of international prices. Therefore, it is fundamental to equate the current imbalance, shifting the stocks from consuming countries to producing countries.

It is necessary that the producers develop internal policies to support the ordering of the supply, as is the case of Funcafé in Brazil, that finances the carry of inventories to avoid sales in moments of depressed prices.”

The FNC draws attention to the importance of increasing consumption in emerging markets and producing countries, for which the support of the International Coffee Organization (ICO) is expected.

“The major concern of all producing countries is the concentration of the industry and the distribution sector, which impose on producers, for example, abusive payment terms of more than 200 days, which massacre any possibility of economic sustainability for producers,” the FNC says.

“The programs that some multinational companies do to promote sustainability are offset by their business practices. Likewise, international non-profit organisations that promote coffee cultivation must take responsibility for absorbing the resulting production surpluses.”

Coffee producing nations will meet again in September during the ICO meetings in London to deepen this discussion.

“It is a priority for producers to communicate to consumers globally the current situation and how this market scenario creates a spiral of poverty in producing countries,” the FNC says.

The African Fine Coffees Association has expressed support of FNC’s statements.

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