Starbucks Pledges $20 Million Relief for Smallholders
In response to critically low coffee prices, Starbucks has committed up to $20 million to temporarily relieve impacted smallholder farmers it does business with in Nicaragua, Guatemala, Mexico, and El Salvador.
Starbucks has pledged $20 million in temporary relief for Central American coffee growers placed in financial jeopardy by depressed coffee prices.
Funds will go directly to smallholders in Nicaragua, Guatemala, Mexico, and El Salvador who do business with Starbucks. These subsidies will help offset lost income until the coffee market self-corrects and rises above the cost of production, announced Starbucks.
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Michelle Burns, s.v.p., global coffee and tea at Starbucks, said a majority of the coffee the company buys is from smallholders. “The coffee crisis cannot be ignored. We have a role and responsibility in helping smallholder farmers sustain their livelihoods. Their success will help ensure the long-term health of coffee productivity,” she said.
Specialty Coffee Association executive director Ric Rhinehart said that “it will be through the strong support of the coffee industry and its leading companies, large and small, that we can set the stage for a viable coffee future, letting the farmers know their investment cost in upcoming crops will be compensated, providing them with much-needed stability in the industry.”
Pedro Rosales Ubeda, a coffee farm owner in Villa Nueva, Nicaragua, said “With today’s prices I can’t invest in my farm, in fact, I can barely cover labor costs. With these prices, my farm is just not profitable.”
The subsidy “means I could provide better conditions to coffee pickers and their families. Also, this will allow me to invest more in my farm, be more productive and offer a better-quality coffee,” he said.
The sum is in addition to $50 million Starbucks provides in low-interest-rate loans.