The ‘true’ cost of conventionally farmed coffee is significantly higher than that of best pratice farmed coffee. If suggested measures are taken, this cost can be reduced and farmers will benefit.

The Food Tank website reports on work by the Dutch-based organization, True Price to promote a new methodology for understanding the social and environmental costs of a product. By scanning the supply chain for products, companies, and investments, they can measure environmental costs (such as biodiversity loss, pollution, waste, land and water use and emissions) as well as, social costs (such as underpayment, worker insurance, health risk, child labor, community impact and discrimination).

Adrian de Groot Ruiz, executive director of True Price presented at Sustainable Food Trust’s first international conference, True Cost Accounting in Food and Farming, using coffee production in Brazil to explain how consumers can be informed of the true cost of cheaper products.

He found that consumers paid on average US $2 per kilogram for conventionally farmed coffee from the Zona da Mata region of Brazil. The true cost for the coffee—when including costs such as land use, water, energy, pollution, and fair and safe working conditions—was US $5.17. For best practice farmed coffee, which includes fair trade, organic, and agroforestry practices, consumers paid US $2.78 per kilogram and the coffee had a true cost of US $4.58.

To close this gap, de Groot Ruiz recommends 4 interventions: establish an equal pay program to address income discrimination; divert money from a community program to higher individual wages; increase yields; and implement sustainable energy programs on the farms.

If such changes are adopted, de Groot Ruiz estimates the true cost of coffee would drop to US $3.79 per kilogram in 5 years and farmers who often operate at a loss would be truly profitable.

Read the full story: The True Cost of Cheap Coffee