Peru is the ninth largest global producer of coffee and the world’s third-largest producer of organic coffee. However, inefficient farming techniques and unsustainable agricultural practices have posed serious threats to the coffee sector. In collaboration with the Ministry of Agriculture and Irrigation, the National Coffee Council and the Swiss Secretariat for Economic Affairs, the Green Commodities Programme of the U.N. launched the National Coffee Action Plan in 2018 in order to increase coffee exports, improve crop quality and enhance sustainability.
Poverty in Peru
From 2002 to 2013, Peru was one of the most rapidly developing countries in Latin America with an average annual GDP growth of 6.1%. The number of individuals living below their national poverty line also decreased during this time, with a report of only 2.6% of the population living on less than $1.90 per day in 2018.
Though significant strides have been made, human development indicators remain low in rural regions. In 2001, 50% of the rural population lived in extreme poverty, but that number plummeted to 10% in 2015. Child malnutrition and mortality rates are 100% higher in rural regions and educational performance is lower than in urban areas. Lastly, the median income in urban regions was 40% greater than that of rural regions in 2015.
Peruvian Coffee Sector
The Peruvian coffee sector creates 885,000 jobs in isolated areas that might otherwise be vulnerable to extreme poverty. According to the Green Commodities Programme, it is estimated that there are 2 million Peruvians involved in the coffee production chain. In addition, 40% of agricultural land is utilized for coffee crops. Additionally, coffee profits account for 25% of Peru’s agricultural income and created $711 million of the export revenue in 2018.
However, this sector poses certain challenges, particularly for small-scale farmers who manage one to five hectares, (two to ten football fields) and comprise 85% of total farmers. Financially, farmers often face difficulties establishing credit and responding to market price fluctuations. They also struggle to afford the requisite fungicides, pesticides and fertilizers that prevent crop destruction. Replacing diseased or aged plants, a strategy to maintain efficiency, costs approximately USD $3,000 per hectare and results in most farmers prolonging the process 10 to 20 years. Environmentally, coffee crops are subject to insects, plant diseases, changing weather conditions and effects of climate change.
Additionally, lack of technical assistance concerning knowledge for best practices results in lower productivity per hectare. This decreased production rate, along with financial and environmental uncertainties, leads to expansion into new regions. It drives deforestation and environmental degradation.
The National Coffee Action Plan 2018-2030
The National Coffee Action Plan incorporates a variety of stakeholders from the public and private sectors in order to combat inefficient practices, deforestation and small-scale farmer poverty. Beginning with the analysis of stakeholder operations and a production baseline in 2016, the dialogue was then established with the National Coffee Platform between 50 organizations. This spans the production chain in order to establish a cohesive vision. Workshops were held throughout the nation and technical groups then assessed the sector’s pressing problems. Lastly, a plan was proposed and legalized in the fall of 2018.
The plan aims to increase crop productivity from 15 quintals to 25 quintals per hectare. It will also categorize 70% of coffee exports as certified quality coffee. Both of these points are marks of sustainability and consistency. Furthermore, marketing development will occur across national and international markets to increase profitability. The plan also aspires to increase producer access to necessary financial services.
By 2030, the National Coffee Action Plan strives to increase competitiveness and sustainability in the following ways:
- Grow coffee exports 120%
- Grow parchment coffee totals to 15.9 million quintals
- Decrease GHG emissions by 1.73 million tonnes CO2 eq.
- Improve living conditions in coffee sectors
Peru’s National Coffee Action Plan recognizes the environmental, economic and social importance of developing the coffee sector and reducing poverty among smallholder farmers. Other initiatives across the global coffee sector that include brands such as Starbucks and illycaffé have promoted similar practices to advance the lives of the 25 million coffee producers worldwide. Though the nation struggles with rural poverty and deforestation, the National Coffee Action Plan displays bold steps towards envisioning a more sustainable coffee sector for both the producers and the environment.
– Suzi Quigg