Big roasters hold key to future of certified coffees

The future of sustainable certified coffee, which ensures that specific standards are met in production, depend on the willingness and success of the industry’s major roasters to bring such coffee into the mainstream.

« If industry makes the commitment we can get more coffee certified, » said Juliette Caulkins, commercial director of UTZ CERTIFIED, a coffee certification program. « Industry has to dare to risk for the sector to grow. »

There are many different organizations that certify coffee as sustainable, typically ensuring that the beans have been grown according to specific economical, social and environmental standards. This also includes certified organic coffee, which is grown with minimal damage to the environment.

Such well-known logos include UTZ CERTIFIED, Fair Trade Certified, Rainforest Alliance and Bird Friendly. The producers who harvest their beans according to the certification standards are paid various premiums for their coffee. The price is then typically passed on to the consumer.

Demand for these coffees has grown in recent years. The Committee on Sustainability Assessment, which aims to provide the first objective data and analyses on the costs and benefits of sustainability standards for coffee, has said imports of certified beans to the United States will reach 16 percent of total coffee imports in 2010, compared to less than 1 percent in 2000.

The International Coffee Organization estimated certified coffees now account for 7 percent of total production worldwide, but warn that further growth is likely flat. « The issue is … the cost benefit of certification because in some cases it becomes very expensive for the grower, » ICO Executive Director Nestor Osorio told Reuters at the Feb. 26-28 World Coffee Conference in Guatemala City.

Producers must meet a number of requirements in order to achieve certification, including preserving water sources and soil on plantations, and guaranteeing specific social services for workers. The sector grew in the wake of the 2000/01 coffee crisis as farmers saw certification as a means of achieving a premium for their beans. As the market recovered, however, the cost of maintaining certification in some cases has become a burden to farmers, Osorio said.

Certifiers are now looking to big roasters to drive demand for certified coffees and bring the sector into the mainstream market. Meanwhile, some major roasters continue to forge ahead with certified products. Sara Lee Corp (SLE.N), one of the world’s top roasters, will source 40,000 tonnes of coffee from UTZ CERTIFIED farms this year.

« Our long-term view is that we have to buy all of our coffee certified, and we are raising the bar every year, » said Dantes Hurtado, president of Coffee and Tea Brazil with Sara Lee. Sara Lee sells coffee brands including Cafe Pilao, Bravo and Pickwick. Nestle (NESN.VX) has pledged to source 80 percent of its beans for its Nespresso AAA Quality brand from farms certified by Rainforest Alliance by 2013.

« The big guys don’t want to get embarrassed so they have to get involved, there’s not a choice, » said consultant Daniele Giovannucci, co-founder of the Committee on Sustainability Assessment.

Better differentiation in the sales of brewed coffee in coffee shops could increase consumer willingness to pay more for coffee made from certified beans. There is often no difference in the retail price of a cup made from cheaper, uncertified beans and one brewed from sustainable certified or organic coffee, Giovannucci said.

« There’s no differentiation on the consumer side but you know that their (producers) input costs are highly differentiated so until you connect cost and price you’ve got a real problem, » said Ric Rhinehart, executive Director of the Specialty Coffee Association of America.

Source : Reuters