Coffee growers reap benefits of boom

Tadesse Meskela says Ethiopian farmers, who supply Fairtrade, are now able to send their children to school. Photo / Steven McNicholl

When Tadesse Meskela starred in the hit 2006 documentary Black Gold the members of his union of Ethiopian coffee farming co-operatives had fallen on hard times.

International prices had crashed to a 30-year low, and many growers could no longer afford to feed their families.

Some farmers were even replacing coffee plants with khat, a narcotic shrub that grows in the east African highlands, because it provided higher returns.

Thanks in no small part to the commodity boom, Meskela, the general manager of the Oromia Coffee Farmers Co-operative Union, says his farmers are doing much better.

The 51-year-old was in Auckland at the weekend as part of Fairtrade Fortnight, a campaign to raise awareness of fairly traded products.

He said the commodity rally - which has also driven up the global prices of sugar, wheat and dairy products - meant Ethiopian farmers could afford to replace thatched roofs with corrugated iron, send their children to school and even buy motorbikes.

"As a result of these current prices the life of the farmers is changing," said Meskela, adding that soaring demand meant he expected the value of coffee to remain high.

Despite the improvements, however, he said many challenges remained, including a lack of roads, health clinics and schools.

Black Gold, which won critical acclaim at film festivals around the world, explored the impact international coffee prices were having on Ethiopian farmers and followed Meskela as he travelled around the globe trying to secure fairer prices for his farmers' crops.

In late 2005 New York's Intercontinental Exchange, which sets the benchmark for global Arabica coffee prices, was trading as low a US90c ($1.14) a pound. Since July 2010 the price has surged from US$1.70 a pound to US$2.75 last week.

And the specialty coffee produced by the Oromia union, such as Yirgacheffe, Sidamo and Harar, is sold at at least $1 above the New York spot price, Meskela said.

He said 15 container loads of raw beans grown by his farmers were exported to New Zealand each year.

The union is made up of 197 individual co-ops representing 194,586 farmers' households across Oromia and produces 235,000 tonnes of coffee annually.

Sixty per cent of the union's exports were certified by Fairtrade, Meskela said, and the premium of US10c per pound of coffee the international organisation provided had funded 117 projects in Oromia, including 19 schools, two bridges, six health clinics and five flour mills.