The Guatemalan Coffee Crisis

Coffee is Guatemala's number one export. Guatemala ranks second in the world (only after Columbia)for the amount of high grade coffee it produces, and has the highest percentage overall of high grade coffee. Over half of the coffee grown in Guatemala is exported to the U.S., the world's largest coffee drinking country. Coffee accounts for 1/3 of all of Guatemala's foreign exchange, and represents 1/8 of the country's GNP.

So why is there a Guatemalan coffee crisis?

Let's start with a brief history of Guatemala and its rural indigenous population.

Since the great depression of 1929, Guatemala has been under several dictators who launched repressive campaigns against trade unions and other forms of organized labor.

In 1954, Jacobo Arbenz was elected by popular vote. Arbenz started working for the people to implement land reforms which brought down the wrath of large coffee plantation owners and the U.S. government.The Arbenz government was eventually overthrown by a CIA led coup in 1954.

The terror that was unleashed by that coup has led to a succession of repressive governments, leading to the civil war which began in 1962. The civil war lasted until 1996, resulting in the longest running war in the Americas, and the death of over 200,000 civilians, mostly poor peasant indigenous farmers.

Although the war has officially been over since 1996,the causes of the confict-- poverty, unequal land distribution and racism, repression and distrust toward the indigenous people still remains today.

The vast majority of Guatemala's smallholder coffee growers are indigenous people.

Coffee production in Guatemala hit a peak at the turn of the 21st century, but fell by 1/3 in just a few short years due to the drastic decline if the world coffee market prices.

When it comes to labor unions and organization, things have not changed much since the days of dictatorship in the early 1900s.

Coffee coming from Brazil and Vietnam has been flooding the market in the last decade where coffee production has increased by over 400%. These countries are using massive agribusiness techniques which has brought the cost of coffee to an all-time low and devastated long standing coffee producers around the world.

Guatemala, in particular has the most unequal land tenure in all of Latin America, with 2 percent of the landowners controlling 65% of the farmland. The rest of the farmland is made up of smallholders, and 27% of the population is landless and forced to work as laborers for the large land holders. These large coffee plantations are know as fincas and are notorious for their unscrupulous labor practices and horrific human rights abuses where workers live as indentured "slaves." They are forced to live in company housing and shop at company markets where they are handed a bill at the end of the season, owing the coffee plantation owners more than they made. They are then forced to come back, often at gunpoint, year after year to repay the plantation owner.

Small farmers are abandoning their farms in search of another way to make money.Prices for coffee have dipped so low that they cannot even eke out an existence or cover their cost for production. Some of the farmers still producing are using their own savings in hope that the market will change.

More than 200,000 people in the Guatemalan coffee industry have lost jobs in just the last three years alone. Coffee growing regions are starting to look like ghost towns as coffee farms are being abandoned in search of other forms of work.

Tens of thousands of coffee producers in Central America are facing bankrupcy. To add insult to injury, this Guatemalan coffee crisis is causing farmers to replace forested coffee farms with pasture land, causing massive deforestation. Some are turning to mono-cropping, using dangerous agrochemicals. These other methods of farming are having serious environmental effects.

In short, statistics vary significantly. But even the most conservative statistics paint a bleak future for Guatemala's coffee farmers unless we start changing the way we do business. It is estimated that at least 56% of the population lives in poverty, and at least 20% (some sources say a lot higher) live in extreme poverty.

Infant mortality is very high at 39 in 1,000 live births, and maternal mortality extremely high at 153 per 100,000 births.

It is reported that 85% of children in Guatemala have chronic malnutrition and stunted growth effect 95% of non-Spanish speaking children in the coffee growing regions of Guatemala.

These rates have been doubling nearly every year since 2001.

Small coffee farmers in Guatemala are now earning less than their cost of production which trickles down to a lack of food and healthcare, increased death rates from malnutrition and disease, homelessness and overall extreme poverty.

The good new is, there are cooperatives which have been forming since 1997, organized to partner with fair trade buyers. These farmers make a minimum of $1.26 per pound, compared to 50 cents or less on the regular market, and the incentive for going organic offers a minimum price of $1.54 per pound.

If we can keep this market moving forward, there is hope for the Guatemalan coffee crisis. We can turn this into a coffee victory.

The solution to the Guatemalan coffee crisis is a lot simpler than most people realize. Supply always steps up to demand.

Demand Fair Trade Certified coffee.

You DO make a difference. After years of pressure, Starbucks, one of the largest coffee buyers on the planet, stepped up in 2009 and doubled its purchases of Fair Trade coffee to 40 million pounds, making it the number one purchaser of fair trade coffee in the world. This happened because of consumer pressure and demand.

Support the small farmers who desperately need your help. Fair Trade Certified coffee is sold virtually everywhere now. Buy fair trade and make a difference. Let's end the Guatemalan coffee crisis, and the coffee crisis worldwide.

Click here to visit Café Campesino Fair Trade Organic Coffees

Read more about the Guatemalan coffee crisis.