Caranavi, Bolivia — Fernando Jordan, a local coffee farmer in the shade of a jungle mountain, points to a row of bushes with tufts of red berries.
“Planting a hectare of land here costs $ 20,000 to $ 30,000 to actually produce coffee,” he told The Epoch Times.
Jordan’s words are touching and reflect one of the few problems facing Latin American coffee growers. This includes a significant surge in demand, supply chain issues, high operating and shipping costs.
The combination of these factors is in step with the recent shortage of production due to poor crops, especially in Brazil, one of the world’s leading producers of commodities.
As Brazil suffered from the worst years of coffee productivity in decades, the world stood up and attracted attention in the first half of 2021 with lower stockpiles and higher prices per cup.
The long-term drought in South America’s largest country has affected Arabica coffee crops nationwide since the end of 2020. This means that the 2021-202 harvest period will be shorter, even before other factors act.
Last July, the frost outbreak also affected the crops of farmers in the cultivated areas of Minas Gerais, São Paulo and Parana, Brazil.
According to the USDA, this means a shortage of 13.6 million bags of coffee during the 2021-202 season.
Coffee growers reflect Jordan’s sentiment about catastrophic high production costs in some Central American countries with high-income instability.
In Honduras, many farmers have given up on the benefits of delicate vegetation heading north along with other immigrant caravans heading to the United States.
El Laurel is a village in northeastern Honduras, where Maria Bonilla and her husband are obsessed with the hope of squeezing profits from their family’s coffee plantations.
“If I didn’t have a mom, I would go to America too … no one here has any solvent,” Bonilla said.
She also made a dangerous journey north to the US border, choosing an undocumented immigrant life over a coffee farm where four children have already left the farm and are struggling with their families. I admitted that I started.
According to the Central American Integration System, about 5 million people in the region depend on the coffee sector to survive. However, the wave of immigrants abandoned their profession due to the high cost and low yield nature of the business.
Taking into account the two-year pandemic supply chain disruption and rising shipping costs, this has further shaken the already volatile coffee industry.
Sam MacCuaig from Keynote Coffee in the United Kingdom connects roasters to local “special, certified, high-end commercial coffee” craftsmanship producers. He said the pandemic had a devastating effect on producers because it relied heavily on sea freight transport.
“Thanks to COVID-19, the freight industry has collapsed and shipping companies have reduced their capabilities,” MacCuaig explained.
Overall, the global coffee industry is projected to decline by 8.5 million bags this season, offsetting the increase in commodity exports from Vietnam, the world’s second-largest bean producer.
Coffee prices hit a 10-year high by December 2021. Unfortunately, demand for beverages reached its highest level in 20 years as of March 15, this year.
Price inflation as a result of the surge in supply and demand does not help consumers, but Jordan said he could sell his heirloom coffee at a good price.
“What I grow is in very high demand because of its flavor. It commands high prices in the market. In Bolivia, you pay 100 Boliviano [$14.50] Per kilo, but in the US market, it can be much higher, “he explained.
Jordan grows Ethiopian Arabica varieties brought to Bolivia by the Spaniards during the colonial era. It currently grows in the fertile Yungas Valley on the other side of the Andes from La Paz.
Between the two mothers of arabica coffee and Robusta coffee, most coffee enthusiasts prefer arabica because of its low acidity and complex flavor profile.
The very popular Geisha coffee, a species of Ethiopian arabica grown in the Yungas region of Bolivia, has a price tag of up to $ 110 per cup at the cafe. At the 2018 auction, Geisha coffee beans from Costa Rican artisan growers were sold for $ 803 per pound.
But it’s not just special blends that are seeing price increases in US stores.
Minneapolis resident and coffee enthusiast Misty Kaiser told The Epoch Times that even big classic coffees like Starbucks and the Caribbean are raising prices.
“Like Target, it’s used entirely in regular stores, not just special roasters,” she said.
Since the end of 2019, Kaiser has noticed a gradual increase in Costa Rican blends purchased from the local Twin City area roster. By the end of 2020, price increases were obvious everywhere.
“Before the pandemic, roasters’ prices per bag rose by nearly $ 2.”
Significant increases in demand began to put pressure on coffee growers in 2019, following the historic drought that affected farmers in countries such as Honduras and Brazil.
And it is unlikely that the price will drop soon.
Colombia, the world’s second-largest producer of washed mild arabica beans, has already stagnated this year.
As of March 2022, the number of bags produced has decreased by 13 percent compared to the same period last year due to the extremely heavy rains during the growing season.
Over the last 12 months, Colombia’s total coffee production has fallen by 16%.
Jordan attribute some of this to the universal truth that is well known among his fellow growers: coffee is a very fragile plant.
Crops are extremely sensitive to aggressive fungal infections and wild temperature fluctuations, and special conditions such as high altitude and high shade are also required for proper growth.
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Autumn is a South American-based reporter who focuses primarily on Latin American issues in The Epoch Times.