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Way of life in peril as coffee price plummets

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The destruction of Indian farming continues unabated. As the giants of world commerce divvy up the proceeds from global productions, the little people, the community bases, often get run over. This is happening on a major scale to the small agriculturists the world over. For the Indian homesteads of Central America that have been the backbone of the cultures for the past century, it is a devastating blow. This is one of the deeply hidden news stories of the past decade ? how the destabilization of local and regional agriculture is creating desperation and causing large economic migrations.

The beginning of the 21st century will witness either the revitalization or the death-knell of Indian agriculture. To be fair, part of the reason for the decline is bad luck ? bad weather, marginal lands, low capital bases ? but a lot of the destruction of Indian agriculture clearly comes by apparent design in a global system destructively tilted against small family farmers.

The hard blow this season is the international trade in coffee. In a market flooded with cheap, low quality coffee beans, a few big conglomerates buy the commodity very cheaply, chokingly low, from the small farming producers, and sell very high. Now the price has dropped out from the bottom of the coffee market. The small-to-medium-sized operations throughout Latin America, for instance, are falling on hard times and failing quickly. The potential for destabilization is quite high, as the desperation of hunger begins to drive the campesino base from its recently productive lands in droves.

It was reported last week in Nicaragua that in one village, El Paraiso, 14 campesinos have starved to death. The situation is dismal for Indian or mestizo farmers there. At El Paraiso, another 100 people last week were begging on a shoulder of highway that passes over the mountain valleys of central Nicaragua. Since April, Nicaragua's 30,000 small coffee producers have laid off most of their 150,000 workers, according to an economic analyst at the U.S. Embassy in Nicaragua. Many other small growers are also devastated.

A report released last week by Oxfam makes it clear how little a share of the international profit goes to the small farmer in Latin America, who is forced to sell as low as $.24 per pound for the home-grown beans. But these are the lowest coffee prices in a century and farmers are burning their lower quality beans for fuel. Hunger is setting in.

According to Oxfam, four multinational companies, Kraft, Sara Lee, Procter & Gamble and Nestle, buy half the world's coffee every year. They sell it for $3.60 a pound, while specialty coffee retailers like Starbucks and others charge that many dollars for a single latt?. Once regulated internationally, coffee is now free market. Mexico, Guatemala, Nicaragua and other coffee countries work from a widespread base of quality-driven coffee producers, but newcomers such as Vietnam and Brazil are flooding the international market with cheap beans, leaving the quality growers priced out of business. While they are often good farmers, the indigenous agricultural communities are at a great disadvantage in Meso- and Central America. They can not produce as cheaply as the newcomers and are quickly going out of business. The coffee crisis is one of major proportion. It directly threatens some 25 million farmers in Latin America. As a result the stage is being set for a significant social emergency.

In Guatemala and much of Mexico, the situation is as dismal as Nicaragua. The small farmer entrepreneur, the campesino gardener, is badly hurt. Compounded by a deadly drought that diminished the summer crops of corn and beans, severe hunger threatens large areas of the countryside. Although currently off the front page of an American media consumed by other events, Central America is again a smoldering, explosive area of the world. Desperation is setting in as the benefits of the world market are once again and most callously denied the small producer.

Last May, hundreds of small-scale coffee campesinos facing bankruptcy marched on Guatemala's Congress. Their demand then was the creation of a fund that would give them access to easier credit. More than 500 blocked off access to the Congress. "If we get no answer," said producer Jose Luis Osorio from the village of Nueva Santa Rosa, "20,000 of us will come next time." In Mexico, the world's fifth largest coffee producer, the state of Veracruz is a good example. Veracruz produces some 20 percent of Mexico's coffee. Low prices have cut 65 percent of the value from Veracruz's coffee crop this year. Many farmers were now migrating to the United States, most illegally. Some estimates put the number of jobs lost in Central America at half a million, as farmers simply cannot make ends meet.

The International Coffee Organization, a group of some 40 major coffee importers and exporters met in London last weekend. They plan to implement a method to cut the glut in coffee by agreeing to destroy 660 million pounds of the lowest quality coffee now stored in warehouses. The ICO claims it would cost $100 million, but would open up a market of $750 million to small producers. Many see this as an emergency measure that would help substantially in alleviating the crisis.

Four of the five major coffee-buying corporations have attacked the measure. Kraft, Sara Lee, Procter & Gamble and Tchibo Holding cite free market philosophies to argue against any move that mediates against the farmers' destruction. However, the ICO statement pointed to a huge disparity in the price of retail sales of coffee compared to what producers in Africa, Asia and Latin America actually receive. "In the early 1990s, retail sales were around $30 billion, but have now more than doubled to $65 billion. Producers' share of coffee sales, however, has fallen from $12.5 billion to $5.5 billion." (The Nation)

The impact on a large population of small farmers is drastic, attacking the stability of many long-term, well-established communities. We are particularly aware of the catastrophic effects upon the Maya communal villages of the Guatemalan highlands. A great deal of indigenous culture is preserved in these communities, which survive by their land-based production.

We support a reasonable level of price subsidy for the coffee farmers who have invested heavily over the years toward more steady harvests of increasing quality beans. Emergency measures that can tilt the market to these highly productive and hardworking campesino cultures of Latin America and the developing world, generally, are highly desirable. So-called corporate "bail-outs" occur all the time. Consumers in North America should hear more and more how their cup of coffee affects the world of these farming cultures. Closer connection between northern consumers and southern producers mutually committed to fine qualities of coffee is one important goal. A more direct sense of partnership with their northern consumers is also crucial for the survival of indigenous farming communities.

We support trade and commerce that can enhance the profile of Native cultures and peoples at the producing end of the world's agricultural markets. The coffee companies in North America that develop and sustain positive relations with the producers they buy from over time need to be identified and upheld as examples of positive corporate conduct during these increasingly troubled times.