Photo credit: csaba_bajko
The current world prices for coffee—set in New York and London—have fallen to their lowest ever level in real terms. As I write these lines, middlemen are paying peasants in Mexico around 44 cents for a kilogram of coffee that will cost North American or European consumers at least $8 and sometimes as much as $30. Ironically, at a time that growers are in dire straits, big coffee companies are announcing record profits.
Because coffee is the only source of income for many rural families, thousands of people, especially the young, are moving to towns in hopes of a better life. ... It is estimated that plantation workers are leaving at the rate of 500 families per week from the State of Chiapas alone. ... Once so close to the U.S. border, many have hopes of reaching the American Dream. But although goods can easily cross borders, facilitated by the North American Free Trade Agreement (NAFTA), Mexicans themselves are kept behind fences. ...The current coffee crisis is also having an impact on the environment. Most Mexican coffee is grown in mountainous areas, where the ecological balance is already fragile. Under the canopy of the forest, coffee can be produced without using agrochemicals, more sustainably than any crop grown by intensive "monocropping" methods, such as sugarcane or maize. ... Because current coffee prices do not even cover the basic cost of production, many farmers are looking for more lucrative uses for their land. Some peasants are cutting down the forest, selling their wood and cheaply renting their land to large livestock owners. In other areas, coffee plantations are being turned into sugarcane fields. ...
Fair trade involves more than just paying a higher price for a product. It means working towards the goal of more equitable trading relationships between producers and consumers. Fair trade is based on economic justice and aims to empower local people rather than give charity."
—Laure Waridel, Coffee With Pleasure: Just Java and World Trade (2001, Black Rose Books)
For more background information about the coffee crisis and how it's reshaping South America, TreeHugger recommends watching Birdsong & Coffee: A Wake Up Call, which takes a look at the situation from humanitarian, economic, and environmental perspectives.