Cheap coffee creates crisis, speaker says

The cost of producing a pound of coffee in Latin America is around 80 cents and that same… The cost of producing a pound of coffee in Latin America is around 80 cents and that same coffee sells for about 50 cents in the United States, a Pitt professor said at a roundtable discussion last week about the price of coffee and its effect on farmers.

Marla Rippol, a professor of Latin American studies, joined Brenda Smith of Building New Hope and John Notte, co-owner of La Prima Espresso Company, to educate students about the ongoing coffee crisis.

Rippol blamed the drop in prices on “excess supply and a long chain of intermediaries between the producer and consumer.”

Along with Brazil, Vietnam is one of the world’s leading producers of coffee, growing and exporting tons of it each year.

Rippol said Vietnamese farmers started growing coffee because it is relatively cheap to produce and easy to grow. Also, the government gives incentives to coffee farmers.

“What is clear, though, is that the Vietnamese government has been giving farmers subsidies and credit for growing coffee,” Rippol said.

John Notte looked at the coffee crisis from a businessman’s perspective. In business since 1994, La Prima experienced high prices during a Brazilian frost a couple of years ago. The current prices are the lowest since 1960.

“I’ll bet this year there are people on their knees praying for a frost in Brazil to keep the prices high,” Notte said.

Notte explained that each coffee-producing country has an organization that buys coffee from the farmers. The coffee is then shipped across the globe. The problem is, he said, that import, export and shipping costs are so high that little or no money ever reaches the farmers.

Notte got involved with helping farmers through Building New Hope, an organization that buys coffee directly from farmers, bypassing high shipping costs. Notte uses La Prima to roast and prepare the beans free of charge.

Building New Hope is currently involved in buying and selling coffee from El Porvenir, a small Nicaraguan cooperative community. Its goal is to provide people with quality coffee that ensures a fair price to coffee farmers.

Building New Hope’s Porvenir coffee is available in numerous locations around Pittsburgh.