Local "Coffee Cultures" and the Global Coffee Market



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Local “Coffee Cultures” and the Global Coffee Market

Joe Marino


Illinois State University

2008
-Abstract-


The tastes and preferences of coffee consumers in the United States affect the livelihoods of coffee producers in places such as Central America, East Africa, and Southeast Asia. In this paper I examine the attempts of a coffee shop owner in Central Illinois to create a “coffee culture” in which his clientele learn to appreciate the different qualities of coffee and make an educated choice with their coffee purchases. The global coffee market is currently being characterized as a "coffee paradox" (Daviron and Ponte 2005). As the popularity of coffee as a beverage is on the rise in large consumer nations such as the US and various European countries, the price per cup is also on the rise. Meanwhile, as coffee producers elsewhere in the world are trying to keep up with the brewing popularity, the price of their crop is falling. Although it is high quality—or "specialty" coffee—that is in demand, majority of the coffee that is on the market today is of low quality and is produced cheaply in mass quantities. Measures have been taken in the form of international regulatory policies set by the International Coffee Commission, as well as by social movements such as the "ethical consumption" movement (Levi and Linton 2003). Using data collected from participant-observation at the coffee shop in Central Illinois and ethnographic interviews with the owner, employees and clientele, this study examines consumers’ coffee preferences and their knowledge of coffee production. As part of a larger study on trends in coffee production in Central America, this paper makes a contribution to anthropological studies of the effects of a global economy on local systems of production and consumption.

It is a typical weekday morning at Kaldi's Kup, a small specialty coffee shop in central Illinois. It's just past 9 o'clock and the crowd of regulars starts to shuffle in carrying the look of fatigue on their faces, still tired from yesterday's long hours spent behind a desk settling students' tuition accounts, grading papers, or studying for exams. I am a barista at Kaldi's Kup, and every morning I brew the finest specialty coffees from around the world, situate the homemade pastries in the bakery case, and adjust the espresso grind to make sure that every shot that I pull possesses each of the subtle complexities characteristic of our award-winning blend. However, most or our customers are not too concerned with these subtleties, just as long as their lattes and cappuccinos are as delicious and topped with beautiful latte art as they were the day before.

Gabriel, on the other hand, is a different type of customer. He is an administrator of the university just down the street from Kaldi's Kup, and comes into the shop two to three times a day, always with the same order—"a double espresso, please." This is the type of customer that Kaldi, the owner, loves to please, not necessarily because Gabriel drinks espresso, but because he is rich in coffee knowledge. He knows exactly what he wants, knows how it is made, knows how it should taste, and he knows exactly where to get it.

On this particular morning, as I see Gabriel walk in and stand in line at the register, I begin to check my grind. I pull shots of espresso into two ounce shot glasses to check the volume, then taste them to check for body, crema, acidity, and the elusive hint of cocoa. As the order comes in over the computer screen on top of the La Marzocco espresso bar, I pour hot water into a demitasse to warm it up, and start the grinder. After the shots have been pulled to their full capacity, which takes about 25 seconds, Gabriel approaches the counter with a smile as he hears the ring of the little spoon being dropped onto the saucer. As he walks away with his two ounces of diffused elixir, he admires the dark brown flecking, or "leopard spots" as he calls them. He pushes the spoon back and forth along the caramel-tan crema and pulls it out to taste for bitterness. Meanwhile, I stand behind the counter watching him intently through the small space between the hopper and the bar, searching for an expression of approval. He takes the initial sip, blinks his eyes and smacks his lips. He takes another, and again quickly smacks his lips while taking in short breathes—"oohh," he says in a low voice, "that's good."

Global commodity chain studies in anthropology explore the exchange of capital over great distances to expose relations between groups of people in different localities around the world. The purpose of this study is to explore one end of the coffee commodity chain, specifically the cultural practices of coffee retailers and consumers, to gain an understanding of how such practices affect, and are affected by, other aspects of the global coffee market. Through the lens of political economy, I analyze ethnographic data from a locally-owned specialty coffee shop in central Illinois, where customers—like Gabriel—acquire a coffee knowledge base while cultivating their tastes and preferences for specialty coffee. These cultivated tastes and preferences then create a demand for the coffees that they enjoy on a daily basis. However, the majority of what is learned by customers pertains to the taste characteristics of coffee, very little pertains its production—much less the social, political, and economic aspects of the global coffee market. While a true commodity chain analysis would require a multi-sited ethnography, this project seeks to understand how retailers and consumers—both agents of the consumer society—envision their role in the commodity chain.


POLITICAL ECONOMY AND COMMODITY CHAIN ANALYSES

The concept of political economy came about as eighteenth-century theorists reflected on the strong economic core of nation-states and their relations with their colonies on the periphery. The term “political economy” comes from Jean Jacques Rousseau in his 1755 work A Discourse on Political Economy (Ericson and Murphy 2003) in which he addressed the legitimate power of the State to govern in the interest of the common good of the nation. The idea of a political economy proposes that the State has power over the economic system of the nation so as to control the wealth of the nation and those under its power (Ericson and Murphy 2003).

In the nineteenth century, social theorists Karl Marx and Frederick Engels studied the phenomena of the expansion of Western capitalism and the seemingly exploitative relationship between nation-states and their capital-producing colonies. They postulated that the unequal distribution of wealth is the product of a capitalist world-system that created an economic pole between the colonies and the powerful Western nation-states (Ericson and Murphy 2003).

In the twentieth century, researchers such as André Gundar Frank (1966) and Immanuel Wallerstein (1974) began to reexamine the effects of global capitalism, which was supposed to have modernized underdeveloped countries and brought an influx of capital through the process of industrialization. Frank and Wallerstein postulated that instead of giving countries in the New World the ability to modernize and produce capital, the exploitative nature of global capitalism is actually keeping these former colonies underdeveloped (Wallerstein 1974).

Frank (1966) conceptualized the relationships between "developed" and "underdeveloped" nations in what is known today as the global economy. Frank reexamined the effects of global capitalism, which was supposed to have modernized nations and brought an influx of capital through the process of industrialization. However, Frank criticized the idea held by modernization theorists that nations are solely responsible for their own economic development and he claimed that the developed nations are in fact keeping underdeveloped nations in a state of dependency.

Researchers inspired by Frank and Wallerstein have looked at the world in terms of the interrelatedness, interconnectedness, and interdependency of societies as a result of the long history of global capitalism. Anthropologist Eric Wolf (1997) argued that anthropologists' traditional focus on studying a single culture, nation, or culture area would not lead to a full understanding of the modern world. Taking a historical, global systems approach he focused on how small, so-called “traditional,” societies had been incorporated into the global world-system and had responded. Using the Marxist approach of Frank and Wallerstein, Wolf further examined how and why some cohorts of people have adapted their cultural understandings to capitalism, and prospered as a result of doing so, while others had not. Wolf’s theory of political economy describes two realities existing in the world: 1.) “the reality of the natural world and its human transformations by technics and organization” and 2.) “the reality of schemata of organized knowledge and symbolic operations learned and communicated among human beings” (Wolf 1997: xiv). Other scholars taking this approach to connecting the material reality of culture with the interpretive reality of culture include Sidney Mintz (1985) and William Roseberry (1989).

More recent anthropological research taking a political economic approach shows how the world system of global capitalism affects the lives of those in societies of primary production and societies of primary consumption. In commodity chain analyses, commodities are followed from producing nations to consuming nations and—in between these two, very often distant locations—processes such as value placement are analyzed to view the affects on each location. Many case studies of commodity chains have cited the fact that the desires and practices of consumers in the North affect the livelihoods of producers in the South (Fischer and Benson 2006, Daviron and Ponte 2005, Collins 2000).

For instance, in Tracing Social Relations in Commodity Chains: The Case of Grapes in Brazil (2000), Jane Collins shows how the taste preferences of Europeans directly affected the livelihoods of small Brazilian grape farms. A year-round demand for grapes makes it necessary for European countries to import much of their produce from the southern hemisphere. These demands require the grapes to be of a certain quality, which puts pressure on small farmers in Brazil to consistently produce high-quality grapes. Small farms account for one-third of the total grape production, while the other two-thirds come from larger agribusiness firms. The smaller farms are able to produce higher quality grapes due to close family management which allows them to be more efficient and cost effective. However, they face disadvantages in exporting their product because they are only able to produce a fraction of the larger agribusiness firms, and thus are unable to afford the means of refrigeration and transportation. Their smaller income and smaller profile in the industry also puts them at a disadvantage with establishing close relations with foreign markets.

The commodity chain of coffee can be thought of as a linear process—moving from its place of production (or origin) to its place of consumption. Coffee is grown around the globe in nations that are considered to be underdeveloped or developing. On the other hand, coffee is predominantly consumed in developed, or "core" (Frank 1966) nations, such as the US and most of Europe, and is one of the largest and most important commodities in the world (International Coffee Organization). The global coffee commodity chain is a process that connects millions of people in different parts of the world. Although producers and consumers are disconnected by thousands of miles, they are reconnected by the socio-cultural practices affecting consumption and production.

In The Coffee Paradox, Benoit Daviron and Stefano Ponte (2005) make a contribution to the theories of political economy and, in particular, attempt to bring clarity to the fact that producing nations of coffee—the second largest agricultural commodity behind cotton—are still very poor and underdeveloped in relation to the US and European nations. Daviron and Ponte pay particular attention to the consumption of coffee in the US and Italy and focus on the value of coffee. They make distinctions between three types of value: 1) material qualities, 2) symbolic qualities, and 3) in-person service qualities. The authors claim that while the producers of coffee have some power in the material sense, much of the symbolic and in-person service aspects of value are controlled on the consumer side of the chain. As the popularity of coffee as a beverage is on the rise in large consumer nations such as the US and various European countries, the price per cup is also on the rise. Meanwhile, as coffee producers elsewhere in the world are trying to keep up with the brewing popularity, the price of their crop is falling. This market crash, which started in June of 1997, is known today as the "coffee crisis" (Osorio 2002). The coffee crisis is the result of international market deregulations and the changing taste preferences of consumers. As prices were on the rise in consuming nations, the profits fell into the hands of intermediary agents of the global coffee commodity chain, such as importers, roasters, and retailers [see the schematic of the commodity chain below (Talbot 2004)]. Most affected by the "global coffee crisis" (Osorio: 2002) were small-scale coffee producers in developing countries, which count on coffee exports as a major source of their national revenue.




[Source:Talbot 2004: 32]

The political economic history of the coffee commodity chain is filled with market crashes and market booms, policy implementations and policy failures, all of which have had subsequent effects on the economic health of coffee producing nations, not to mention the livelihoods of the coffee farmers themselves. Ongoing economic research shows the rise and fall of the coffee market each year. There is much more to economics than just the statistics behind supply and demand. What is not so ubiquitous is research that shows the human involvement in this global commodity. After all, as Wolf (1997) points out, it is through socio-cultural interactions that such processes as supply and demand become real.

Both consumers and producers are often blind to the effects of capital exchange on the social relations that surround the commodification of labor. Yet, coffee consumers in Central Illinois have an effect on the livelihoods of coffee producers in underdeveloped countries. For this particular study, however, the question of whether the United States, as a consuming nation, keeps coffee producing nations in a state of underdevelopment will be set aside. Instead I will be investigating the discourse of coffee in a small consumer setting to elucidate the role of this particular commodity in the lives of consumers on this side of the commodity chain in the global economy.

Consumers as individuals, and a consumer society as a whole, are key components in a global commodity chain. In this context, much responsibility is placed upon consumers, whether they know it or not. In Contradictions of Consumption, Tim Edwards discusses the concepts of consumption and the practices of consumers that make up their daily lives. In distinguishing between a "consumer culture" and a "consumer society," Edwards describes "consumer practices as matters of style, taste, and identity," as pertaining to consumer culture, whereas "the more [political], historical or economic underpinnings of consumer practices" would be characteristic of a consumer society (Edwards 2000:3). These conceptions of consumerism present a useful lens with which I may be able to analyze and theorize the coffee consumers in central Illinois and the discourse of coffee on this end of the global commodity chain. The taste preferences and purchasing habits of these local consumers will have an affect on the livelihoods of producers elsewhere, thus it is important to analyze how these choices are made on a daily basis. Coffee consumers that frequent a small coffee shop in Central Illinois are presented with a choice of coffees from different coffee producing nations. The choices they make on a daily basis will have an affect on the livelihoods of producers elsewhere. But how do they make these choices? What factors come into play when deciding which delightfully aromatic beverage to enjoy on that particular day? How do they, or are they able to make the choice to come to this particular shop—as opposed to other coffee shops located within a short distance?

Using data collected from participant-observation at the coffee shop in Central Illinois and ethnographic interviews with the owner, employees and clientele, this study examines consumers’ coffee preferences and their knowledge of coffee production. However, before turning to these data, I provide a brief history and overview of the global coffee market.

COFFEE IN THE GLOBAL ECONOMY

The Legend of the Bean
A young goatherd by the name of Kaldi was guiding his goats through the 6th c. hills of Abyssinia—what is known today as Ethiopia. As a musician and poet, Kaldi took to the pleasure of playing pipe and singing songs while he let the goats wander. When it was time to go home, he would play a distinctive note and the goats would come running to his side. One day, he played the familiar note, but the goats didn't come. A little worried, he went to look for his goats and heard them bleating in the distance. When he finally found them in a field of glistening plants with big red cherries, he stood puzzled as they were excitedly dancing about. He thought for sure that his goats had gone mad! He was finally able to get them home, but the next day, the goats immediately took off for the same field off in the distance. When Kaldi caught up to them, he found them eating the leaves and cherries of the mysterious plants as they pranced around in a fuss. Curious, the boy tried a cherry from one of the branches and began to dance around with his heard in utter joy. [Adapted from Pendergrast 1999]

History of Coffee in the Global Economy

Although coffee was most likely discovered in Abyssinia—or what is known today as Ethiopia—the first major producer and exporter of coffee was Yemen. Sometime in the 6th century, the Abyssinians invaded Yemen, which is located just across the Red Sea, and subsequently brought with them seeds to cultivate in the area. In the 16th century the Ottoman Turks invaded Yemen, and upon discovering the delight of their warm, dark, and stimulating beverage, distributed the drink throughout the Ottoman empire. By the 17th century, Europeans visiting Constantinople participated in what Mark Pendergrast calls "an elaborate social ritual,"

[C]offee was brought to a boil three times in the ibrik (a small conical copper pot with a long handle) before the viscous drink was dispensed into small cups, the pourer carefully shaking his hand so that a little wesh, or froth, topped each cup. (Pendergrast 1999:7)

Realizing the astounding popularity of coffee, and with the intention of monopolizing all of its financial benefits, the Turks forbade the export of any fertile cherry or bean that could be germinated and grown elsewhere. However, against their best efforts, a pilgrim to Mecca was successful in smuggling a couple of seeds to southern India, where he subsequently began to cultivate plants of his own. From India, the coffee plant spread to the Indonesian islands by the hands of the 17th century Dutch traders. They also brought coffee to northern Europe, where they grew plants in a greenhouse, then transported the offspring down to the more suitable climates of the Indies. As the Dutch were initiating the global network of coffee trade, they were also kind enough to spare a few plants to neighboring kingdoms, such as that of King Louis XIV. In 1723 a French naval officer by the name of Gabriel Mathieu de Clieu transported a plant from the Jardins des Plantes in Paris to the French colony Martinique.

By the middle of the 19th century, coffee had spread all over the new world, with coffee farms springing up throughout Central America and on into South America. By the turn of the 20th century, Brazil was the world's leader in coffee production (Pendergrast 1999). In 1906 Brazil implemented a "valorization policy" (Daviron and Ponte 2005: 84) which formed strong marketing ties with the larger European and US merchant firms. This policy helped Brazil gain control of price-setting for Latin American coffees and perpetuated the growth of coffee farms elsewhere in the region.

With the onset of the first world war, the 1929 market crash, and on through World War II, the coffee market was not only slowed by the inability of consumers to afford coffee, but was also fragmented along political lines. Prior to the Second World War the US was compelled to stimulate relations with their neighboring coffee producers to the south, and in 1940 the US and the Latin American coffee producing nations signed the Inter-American Coffee Agreement (Daviron and Ponte 2005: 86). As the European market had stopped buying Latin American coffee, and instead began investing in their own coffee producing colonies in Africa, the US had therefore become the largest importer of the Latin American crop. With the onset of the Second World War, however, the US had frozen its import prices, leaving the coffee producers holding nothing but their cherries. With the lull in exports, coffee was over produced and the prices were dropped. To ensure some stability in the market, most Latin American nations signed the Mexico Agreement in 1957, but it was not entirely sufficient for covering the global coffee market (Daviron and Ponte 2005). The first agreement to cover all coffee producing nations was the International Coffee Agreement (ICA), which was signed in 1962 under the International Coffee Council (ICC). This regulatory policy both set a minimum market price for coffee, as well as limited the exports of coffee for producing nations.

A result of this "regulatory regime" (Daviron and Ponte 2005), was the mass production of the less costly Robusta varieties of coffee plants. These beans were widely used in the popular instant coffees and larger corporate coffee roasters such as Nestle and Philip Morris. The downfall of this stabilizing agreement, however, was influenced by the rise of the "Yuppie" culture (Pendergrast 1999) in the 1980s, which increased the demand for the more costly whole bean Arabica varieties. With the cold war coming to an end, the US no longer had to maintain such close ties to the Leftist Brazil or other Latin American countries that could have conceivably sided with the Soviet Union. Subsequently, this led consuming nations—especially the US—to deal with non-ICA members in pursuit of lower coffee prices. The failure to renew the ICA in 1989 left producing countries to struggle in the competitive market while maintaining economic stability. The price of coffee was cut in half from $1.34 per pound in 1988 to $0.77 per pound in 1994 (Daviron and Ponte 2005: 88).

In this crash of the coffee market and subsequent "coffee crisis" (Daviron and Ponte 2005: xvii), producing nations lost significant amounts of capital and economic stability while intermediary agents of the coffee commodity chain in consuming countries benefited from significant profits. As larger, corporately tied producers try to keep their costs low by harvesting and planting inferior—but more disease-resistant—Robusta beans, smaller specialty coffee farmers invest in the more flavorful Arabica varieties to achieve a higher sense of quality. Although the popularity of higher quality beans among consumers continues to rise—as does the niche of small, privately owned coffee shops that feature such coffees—the small-scale producers are still unable to compete with these larger coffee producers. Growing attention to these vast inequalities and the demand for higher quality coffees in consuming nations has given rise to not only transnational organizations such as Fair Trade—which is determined to give fair compensation to farmers for the efforts in producing high quality crops.


Specialty Coffee vs. the General Market

There are two types of coffee beans most commonly used in the world today—Arabica (Coffea arabica) and Robusta (Coffea canephora). The varieties differ in size, flavor profile, and caffeine content. Robusta beans possess a much simpler flavor profile and thinner body in the cup than Arabica, and although they are smaller in size, they contain more caffeine. 70 percent of all coffee on the market today is of the Arabica variety. It is produced at high elevations in tropical and subtropical regions of the world, such as sub-Saharan Africa, Central and South America, and Indonesia. It requires anywhere from 1200mm to 1500mm of rainfall each year and an average temperature of 20 degrees Celsius (Talbot 2004: 31). Given that coffee is so ecologically specific and that it is one of the largest commodities on the market today, it behooves countries that are ecologically suited to grow coffee and treat it as the predominant source of national revenue. One would assume that the global popularity of coffee would yield high profits for those who produce the crop, yet these developing nations, on the "periphery" (Frank 1966), remain in poverty.

According to the Specialty Coffee Association of America (SCAA), "specialty coffee" (SCAA 2008) comes from small-scale farmers who grow crops in exceptional climate conditions that allow the plants to develop to their full potential. Specialty coffees are made purely from Arabica beans, which tend to take on unique characteristics of the soil where the plants are produced. The distinct qualities of the soil in each particular region make it possible, then, for consumers to be able to enjoy various subtle differences in each cup of brewed coffee. When coffees are being tested and graded, specialists look for those distinct flavors and qualities characteristic of the region of origin. However, much effort needs to be made by the farmers in order to achieve the desired flavor profile. Although the specialty coffee sect makes up less than two percent of the global coffee market, over 25 million people are involved with its production.

This specialized sector differs from the general coffee market—which is inundated with coffee that is not always grown in the proper conditions and is produced in mass quantities—in terms of production and marketing. Most of the coffee that is produced for, and sold in the general market is produced on expansive plantations in countries such as Brazil—the world's leader in coffee production. These larger plantations, or fazendas, have strong marketing ties with international import/export corporations that deal with larger marketing and retailing corporations in consumer nations. Production and harvesting on these plantations are described as "technified" processes (Talbot 2004: 199) as they incorporate the use of specified technologies and machinery. These machines are managed by technicians and laborers who possess the appropriate knowledge and training of how to use them. The purpose and focus in this type of production and harvest is truly quantity and not quality.

Specialty coffee farms are located in the highlands of coffee producing countries and are usually family-owned. These small-scale farmers predominantly cultivate trees of the Arabica variety. It takes coffee trees approximately five years to mature, thus, newly planted trees will not yield fruit until after this happens. When they do begin to bare fruit, they bloom twice a year—once in the spring and once in the fall—whereupon they are harvested by the family who owns the farm with the frequent help of waged laborers. Among the various methods for harvesting coffee, the two that do not involve machines are: strip picking—which is common on farms such as the larger fazendas of Brazil, and selective picking—which is common on specialty farms (Intelligentsia Coffee Inc: Cultivation 2004). The strip picking method usually involves a group of workers whose goal is to make the least amount of passes along a row of trees while picking as many cherries as possible. Thus, the trees are stripped, branches at a time, without regard to the ripeness of the cherries. In contrast, selective picking involves multiple passes of each row by individuals carrying baskets. Pickers survey each plant carefully making sure to only harvest the cherries that are ripe, leaving the un-ripened ones to develop to their full capacity. This method is definitely more time consuming, since not only are the pickers going through the trees a branch at a time, they also have to make multiple passes along the same row of trees. The reason for this is because each tree yields only about one pound of beans per year. So in order to make sure every ripe cherry is picked, and there is a large enough quantity to sell, numerous passes must be made. The people that are doing this intense and time consuming work on specialty farms are usually the members of the family that owns the farm—children included. These families live in nations where 15% to 56% of the population is under the poverty line (CIA World Factbook: Vietnam, Guatemala 2008).

Various transnational organizations have formed in the last ten years to address the issue of development, and with the mission of eradicating poverty in coffee producing nations. Organizations such as the Coffee Quality Institute (CQI), the International Coffee Organization (ICO), and the Specialty Coffee Association of America, all have a hand in working to create a sustainable coffee market by bringing producers closer to consumers. The SCAA and the Coffee Quality Institute work with the governments of both producing and consuming nations to set economic and environmental standards to ensure consistent high levels of quality. These organizations also take part in raising farmers' awareness of the flavor characteristics desired by the consumers. For example, the CQI has implemented a grading system for evaluating coffee quality:

As a credible and independent service, the Q Coffee System helps to strengthen the supply chain for specialty coffee by creating a common language for quality, providing valuable feedback to producers, and a system to effectively identify and differentiate coffees.

(Coffee Quality Institute: Q Coffee System 2005)

With the absence of ICA regulations, which provided the security of a price floor, coffee producers had to think of new ways to make their crops distinct from the others on the market. Thus, many farmers, especially small farmers in ideal coffee producing climates, concentrated their efforts on producing coffee of the highest quality while employing sustainable methods to do so.

Specialty coffees are made purely from Arabica beans, which tend to take on unique characteristics of the soil where the plants are produced. The distinct qualities of the soil—or terroir—in each particular region make it possible, then, for consumers to be able to enjoy various subtle differences in each cup of brewed coffee. When coffees are being tested and graded, specialists look for those distinct flavors and qualities characteristic of the region of origin. However, much effort needs to be made by the farmers in order to achieve the desired flavor profile.


Boosting Prices: The International Coffee Agreement of 2007

In 2007, the International Coffee Council (ICC) signed a new International Coffee Agreement (ICA), answering the cry of coffee producing nations in economic crisis. In the new agreement, the ICC recognizes the need for the market to be stabilized under the moral responsibility of both producing and consuming nations to create sustainability in the global economy of coffee. The discourse within the 2007 ICA revolves around this moral responsibility to bring producing nations—many of which "are largely dependent on this commodity for the export earnings and for the achievement of their social and economic development" (ICO: 2007 International Coffee Agreement)—out of poverty. Sustainable coffee production is thus a means of achieving the Millennium Development Goals developed by the United Nations in 2007 (United Nations 2005: UN Development Goals), which are to be achieved by the year 2015. The mission of the goal-set is to boost the livelihoods of all of the world's citizens by way of eradicating extreme poverty and hunger, improving environmental sustainability, and controlling disease.

The following is an excerpt from the ICO website:

The new Agreement is an important instrument for development cooperation and will provide the legal framework for core activities undertaken by the Organization in the future. Around 15 of the ICO’s 45 exporting Members are least-developed countries (with low incomes and high economic vulnerability), and the 25 million small coffee farmers and their families who produce 90% of the world’s coffee are particularly affected by fluctuations in market prices and imbalances in supply and demand.  The Preamble specifically acknowledges the contribution of a sustainable coffee sector to the achievement of internationally agreed development goals, including the Millennium Development Goals, particularly with respect to poverty eradication. 

(International Coffee Organization: International Coffee Agreement 2007)

As members of the ICA recognize the fact that the majority of the world's coffee producing nations are least-developed countries, they recognize the importance of international policies such as the International Coffee Agreement of 2007.
KALDI'S KUP

I want to create a coffee culture here [in central Illinois] where customers learn to appreciate the different characteristics of coffee and are able to make an educated choice with their purchases.

Kaldi 2007

Kaldi's Kup is a small specialty coffee shop owned by Kaldi and his wife Abigail. They actually own two stores in town—one is located Downtown (and will thus be named), and the other Uptown—but for this study I have focused on the store located Uptown just down the street from a large university.

Kaldi's first interest in the coffee business was not coffee itself. His primary motivation was finding a career that would allow for him and his wife to work together while raising a family. He knew that he wanted to go into business for himself because he didn't want to be at the mercy of someone else dictating his career. He is a self-admitted "perfectionist" and knew that whatever he got into he could do it right and do it well. He struggled with the idea of opening a café or diner, but was somewhat disenchanted with the restaurant business from past experiences. He knew that it would be very difficult open a restaurant with no "cash-flow," or no base income. He wanted to incorporate his baking abilities and knowledge into whatever he chose to do. He researched the internet for possible ideas and found that coffee is a perfect compliment to his baking abilities. As he tossed this idea around he saw a future for this particular venture in his home-town. He recognized that the specialty coffee market had not yet been tapped to its full potential in his community. As of 2002, there was not yet a Starbuck's in this community. In February of 2002 he made the final decision to go forth with his coffee shop idea, and in six short months, his doors were open for business. In that short time, he hired a consultant to help him design his shop and draw up business plans.

My first experience in the shop was in early 2007. It gradually became my favorite hangout, as it is a great place to enjoy a good cup of coffee, study, or just kill some time between classes. By May of 2007, I had become very interested in the coffee industry and thought that I would apply for a position working at the shop. At the new employee orientation, Kaldi guided us through the process of cupping. This elaborate taste test could be likened to that of a wine tasting, where one would try small samples of wine—or in this case coffee—to become accustomed to the aromatic and taste characteristics of the drink. The ability to identify such characteristics allows the consumer to identify that which he or she likes in a wine or coffee.

During the employee cupping, Kaldi stated that he wanted us employees to be able to describe the different characteristics of the coffees to the customers so that they may be able to tell the difference between a good cup of coffee and a bad one. To achieve his goal of creating a "coffee culture" Kaldi not only passes his coffee knowledge onto his clientele through his employees, but also through a weekly session of "coffee talk." Every week Kaldi will either perform a small customer cupping with the coffees we regularly carry in stock, or might feature a prize winning coffee—such as the 2006 Cup of Excellence award winner, Fazenda Santa Inés from Brazil. But not only is Kaldi concerned with taste, he is also concerned with selling a sustainable product.


Sustainable Coffee: Fair Trade, Direct Trade, and Organic

Fair Trade is part of the 'ethical consumption' movement; purchasing power is used to promote moral ends, goals that serve the material interests of others often at a cost (albeit sometimes relatively minor) to the consumer.

Margaret Levi and April Linton, Fair Trade: A Cup at a Time?

Specialty coffee shops like Kaldi's are part of a movement that is focused on appealing to the moral responsibilities of consumers to make ethical choices when making their coffee purchases. As Kaldi follows and believes in the rhetoric of the ethical consumption movement, he only sells sustainable coffee. "The concept of sustainability in the realm of specialty coffee includes aspects variously referred to as 'economic viability for farmers', 'environmental conservation' and 'social responsibility'" (Daviron and Ponte 2005: 164). Most—but not all—sustainable coffee carries certifications such as Fair Trade or USDA Organic. However, Kaldi says that the Seattle roaster that he buys his coffee from will frequently pay four to five times over the market price for their coffee (which, in effect, boosts the price for each cup of coffee at Kaldi's shop). This Seattle roaster will often buy their supply of green coffee directly from the small farmers and leaders of coffee coops at origin. This process—called direct trade—is used by many small roasters in consuming countries to cut the middle links out of the commodity chain (i.e. state agencies, marketing boards, transnational importers). A representative from the roaster will travel to origin where he makes personal contact with the coffee producers and samples their crop in a series of tests. Throughout this testing process, the cupper, as he is called, will grade the coffee while looking for consistency in all of its physical qualities including: bean size, shape, and upon brewing, the aroma, acidity, and body. If the Seattle roaster is not able to make a purchase through direct trade, however, they will buy coffees that have Fair Trade or USDA Organic certifications.

When customers come into Kaldi's Kup and place their order they are presented with a choice between two different brews indicated by their country of origin—"would you like Guatemala or Kenya?" It is at this juncture where the education for the consumer begins. The choice offered by the employee—or barista—is usually followed by, "well, what's the difference?" From there the barista will explain the different quality characteristics of the two coffees, describing the aroma, body, roast, etc. As the shop is frequented by many regulars, it is common for the customer to become accustomed to a particular origin. In the dialogue between the barista and the customer, the customer picks up on the different qualities of the coffee and is now able to identify that which he or she likes or doesn't particularly care for.

Yet, although the coffee sold at Kaldi's Kup is rated in the top two percent for not only the quality of taste, but also their sustainable cultivation, the dialogue between customers and employees is usually limited to just the taste characteristics, leaving out whether or not the coffee is "Organic" (as approved by the United States Food and Drug Administration) or Fair Trade certified. Much less is the economic process of such certifications, nor the coffee market in general, discussed upon such an encounter. If Kaldi's goal of educating his clientele is carried out, how then do the customers orient to their roles as actors in the global process of coffee trade?


Customers of Kaldi's Kup

In the data collected for this study, I have identified three types of customers: 1) consumer as "king" (Edwards 2000: 11), 2) consumer as "anti-consumer" (Edwards 2000: 21), and 3) an indifferent consumer.

As a consumer, Gabriel is king (Edwards 2000). He knows exactly what he likes and he knows exactly where to get it. In fact, Gabriel has so much power as a customer at Kaldi's Kup, that the baristas working at the shop gauge the quality of their espresso according to Gabriel's comments. Though, Gabriel went through a long process of coming to identify what he really wants in a coffee. After his first encounter with coffee in high school, he slowly got used to the taste of coffee while diluting it with a little bit of cream and sugar. After a while he was able to drink it black. Much to his surprise, he was able to pick up on the subtleties of each coffee. As he became more of a regular drinker, his tastes started to change from drinking the more flavorful light coffees, to the "stronger, bolder, French roasts." It wasn't until 2002, when he first visited Kaldi's shop, that Gabriel got a taste for what a good double espresso was. Of course, he had had double espressos before, but was never quite impressed with what he received. When he tried one at Kaldi's shop, he was both pleased and fascinated to find the complexities of flavors from just two ounces of the infused brown elixir. Every day he would come into the shop and engage in conversation with Kaldi or whoever the barista working the bar happened to be at that time. While sampling shots, Gabriel would talk with the barista about the different taste characteristics of the espresso, depending on the varying coarseness of the grind or blend composition.

It soon became Gabriel's daily routine to come into the shop for discussion while savoring his morning boost of caffeine. Now he comes into the shop two to three times a day for a dose of "geek-talk" and caffeine. Gabriel claims that one demitasse will keep him going until after lunch, whereupon he will come into the shop to get another. He says that although he does feel a come-down from the caffeine, it is not as drastic for him as it was when he routinely drank regular drip coffee. However, since Gabriel recently bought a home espresso maker, he often makes himself his morning shot before leaving for work, then will come into the shop after lunch. Though, Kaldi need not worry about Gabriel's home espresso maker, simply because he buys the beans he uses to make espresso at home from Kaldi's Kup. Gabriel loves the blend used by Kaldi and claims that it is the "best blend in town."

Gabriel's taste for coffee is much like his taste for wine—he loves a complex flavor profile, in fact, he says that this is the most valuable and important attribute of espresso. So it is fitting then, that he prefers blended wines, which, like coffee blends, possess such complexities. But where do these complexities come from? What is in the espresso blend at Kaldi's shop? Gabriel says that the "origins"—a term used to identify where the coffee was grown—that comprise the blend will determine whether he will buy it or not. Although he did not give a definite answer when I asked him what specific origins he looks for in a blend, he replied saying, "well, I know that Ethiopia will give it chocolate, Sumatra will be more earthy." Essentially Gabriel believes that if the blend contains specific origins like Ethiopia or Sumatra, then he knows that it will be good.

These valuable taste characteristics, or material qualities (Daviron and Ponte 2005), identified by Gabriel, can be best explained through the concept of terroir, which is a term used by wine connoisseurs to describe the geo-specificity of particular wines. Wine growers in the French region of Bordeaux argue that blended wines can only be called Bordeaux if they come from the region of Bordeaux. As Bordeauxs are made up of a particular blend of grapes grown in the same region, they tend to possess a particular flavor profile that is characteristic of that region. Though, the types of grapes characteristic of a Bordeaux blend can of course be grown elsewhere in the world. However, the concept of terroir holds that it is more than just the type of grape that makes a wine special; it is the very soil in which the grape vines are cultivated that give the Bordeauxs their distinct flavor. The same argument is made by coffee growers in places such as Ethiopia—where a major trade marking movement is underway—that coffee also gets its distinct flavor characteristics from the soil in which the coffee plants are grown.

Gabriel's particularity for taste, however, is in complete contrast to the indifferent customer who comes into the shop asking for a regular cup of coffee, and is somewhat confused by the choices presented to them. For example: a customer comes in and asks for a cup of coffee. The barista asks, "would you like Guatemala or Sumatra?" At this the indifferent customer says, "what's the difference?" The barista will then explain the different characteristics of each bean, only to have the customer say, "it doesn't matter, just give me a cup of coffee." However, it does matter to Gabriel, and not only does taste matter, but so does sustainability—to a point.

Gabriel says that he loves to see blends that are Organic, "but," he says, "of course it would depend on the blend." If there are two bags comprised of the same origins sitting on the shelf at a store, and one was Organic and the other not, then of course he would buy the Organic blend. Yet, if the Organic blend was made up of lower quality beans, then he would not bother to buy it. "Well, what about Fair-Trade?" I asked him. "I don't pay much attention to Fair-Trade, because, as an economist, I know that whether or not the exchange is actually 'fair' or not, depends on however the rules are set up at that particular time. You know, 'fair-trade' doesn't necessarily mean that it is always fair."

There are some customers, however, that do pay attention to Fair-Trade campaigns. I spoke with one male student who had been in the shop for over three hours studying and cruising the internet over the free wi-fi connection offered by Kaldi's Kup:

Although not all of the coffee here is fair-trade, it has less of an economic impact than Starbucks. As the leader of the specialty coffee industry, Starbucks should be buying into and offering more fair-trade and organic coffees than they do. They will only sell fair-trade if it is specifically requested by the customer…if you don't buy it, you are essentially contributing to slavery.

This student says that he is adamantly opposed to buying Starbucks for the reasons stated above, a sentiment is echoed by another female student who answered the question "why do like this particular shop?" with "because your coffee doesn't have that corporate aftertaste!" Such statements are common among consumers who "[try] to undermine consumer society through the practice of anti-consumption in campaigns, demonstrations and boycotts" (Edwards 2000: 12). The male student, however, admits that he does not come to Kaldi's Kup just because it is not Starbucks. He likes to come to the shop because the location is convenient, it fosters a good work environment, and because of the "relatively low cost."

Small-scale Production and Small-business Owners

What can be said about this study is that our system of global capitalism makes it extremely difficult for small-scale businesses to survive without profit. "The system is just not built for small-businesses," Abigail says, "if we don't make a profit, we can't stay in business." To open a business you have to have large sums of money. If you do not have money, this requires you to procure loans. Kaldi and Abigail have taken out loans of various amounts [which cannot be discussed here], from bankers as well as from family. When they opened the shop Uptown, they were just about to break even on the loans for the first shop located downtown—setting them back even further. To sell a high quality and sustainable product is a costly endeavor, which requires certain things to be sacrificed, including shop supplies and personal time. Both Kaldi and Abigail have had to seek second jobs in addition to running their business. The extra employment has become necessary not only to cover overhead costs (i.e. utility bills, wages, and rent), but they are also looking to expand their business by becoming roasters.

Recently, Kaldi and Abigail had purchased a coffee roaster, which will be used to roast green coffee down in the basement of the Downtown store. Their goal is to become a small specialty roaster themselves so that they will not have to deal with an outside company such as the Seattle roaster that they buy from now. In doing this, Kaldi and Abigail will be buying their own green coffee in small quantities from wherever they can: larger roasters, TNCs, or maybe from producers themselves in a direct-trade. Kaldi spends over $90,000 on coffee every year, but with this new roaster, he claims that he will be able to cave about $40,000. "The system is just not built for small-businesses," Abigail said in a conversation about what would happen to their business once her and Kaldi started roasting their own coffee. Abigail claimed that it is much more difficult for smaller independent roasters to participate in direct-trade because it requires expenses above and beyond the cost of the coffee. These expenses include travel costs, purchasing costs, shipping costs, and storage costs. Not to mention the work it will take to make strong connections with specialty producers. With the increase of specialty coffee's popularity, it is much more difficult to make competitive bids on green coffee.

Even if Kaldi and Abigail were able to cover these additional costs, they are still a relatively new family (their eldest only three years old), which means that they are not readily available to make trips to coffee farms. As it is, they can only afford to pay their employees the state minimum wage of $7.50 per hour.

As the global process that is the specialty coffee industry is influencing the business plans of Kaldi and Abigail, it is also causing them to change their identity as a local coffee retailer. The purchase of the coffee roaster will change the identity from a small, local retailer, to a small private roaster. As a roaster, Kaldi will be personally contributing to the material value (Daviron and Ponte 2005) of the coffee. Each coffee's taste characteristics in the cup depend on the level of which the beans are roasted. More fruit and floral flavors will be present if the roast is lighter. When the roast gets darker these flavors—along with the coffee's acidity—will be lost, giving way to more smoky flavors characteristic of the dark French roasts. Of course the shop will retain its status as a small retailer, but the roaster also yields the potential of turning the shop into a distributor. This means that Kaldi and Abigail can not only benefit from selling their specially roasted coffees in their own shop, but also from selling larger quantities of beans to smaller shops elsewhere.

The increasing popularity of the specialty coffee market is not only influencing the business plans for Kaldi's Kup, but also the changing identities of producers in Central America. As the means of food production in Central America are becoming more industrialized in the context of the North American Free Trade Agreement, large proportions of the revenue from coffee production are being used to pay for food that was previously produced locally (Castillo and Nigh 1998). This puts pressure on coffee producers to change their means of production in order to increase the value of their crop. To achieve this, farmers in Chiapas, Mexico are changing their traditional methods of agriculture to fit the requirements needed to gain Organic and Fair Trade certifications (Castillo and Nigh 1998).



FINAL DISCUSSION

Changing consumer preferences may be important, but it is complementary to corporate campaigns, political mobilization, and unionization.

Margaret Levi and April Linton, Fair Trade: A Cup at a Time?
With this study of specialty coffee, we can see another way in which consumers in the North have great impact on the livelihoods of producers in the South. The value of coffee is determined by consumers who incorporate this product into their daily lives. So how, then, do the customers of Kaldi's Kup orient to their roles in this global process that is the coffee commodity chain? Majority of the customers place much value on the in-person service qualities, such as the shop environment and latte art. Furthermore, the majority of customers are not too concerned with the symbolic qualities of the coffee, such as the socially oriented certifications like Fair Trade or Organic. Ethical consumerism is a practice that involves consumers making demands of retailers to sell only environmentally and economically sustainable products. However, in the case of Kaldi's Kup, this practice is working in reverse. It is the retailer that is selling the sustainable products to consumers who have little knowledge of what is being sold. The fact that Kaldi sells great tasting coffee—a material quality—is only a secondary attribute. At Kaldi's Kup, some customers recognize that the coffee tastes good, but very often we have to tell them why it tastes good. So, while the retailer is educating the consumers, other agents of consuming nations are teaching farmers in producing nations how and why their product is so good in the eyes of the consumer. Thus, it is the consuming nations in the North who are controlling the production of specialty coffee in the South. However, organizations such as the Coffee Quality Institute are working to bridge the gap between the North and the South and open the eyes of both producers and consumers to the socio-cultural practices surrounding this global commodity with programs such as the Q Coffee System and the Specialty Coffee Program (Coffee Quality Institute: Other CQI Projects 2005).

Although socio-economic movements such as Fair Trade are implemented in order to improve the economic and environmental conditions for producers, they are still not quite enough. This has implicitly been recognized by such organizations as the ICO and ICC which have made it their mission and responsibility to set standards for the coffee market so as to improve the quality of life for producers in developing nations.

Kaldi sees himself as a family man who is running his business to earn a living to support his family. He adapts to the changing economy and makes business plans to improve his chances of doing so. Coffee farmers thousands of miles away from Kaldi's Kup are also trying to earn a living, and they too are adapting to the changing economy. As we see in this study, changes that are being made on either side of the commodity chain are impacted by the relations between consuming countries in the North and producing countries in the South. However, as we also see in this study, these international relations and policies are impacted by the taste preferences and desires of consumers. Thus, the livelihoods of specialty coffee producers in poor underdeveloped countries are heavily impacted by the taste preferences and desires of consumers in wealthier developed nations such as the United States.

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