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Tuesday 9th December 2003

The Cost of Coffee

The price of coffee has reached an all time low - Oxfam has a report out today which says it's fetching less that at any time in the last 100 years. Mike Thomson reports on the impact.

Not far from the Somali border in the far east of Ethiopia a group of farmers from the village of Deder are moving slowly across a sweltering hillside singing. The high warbling notes from the brightly clad women punctuate the deep refrain coming from the men as they walk between straggly lines of coffee bushes. It’s all part of a centuries old harvesting song. But these weary looking peasants aren’t harvesting the bushes, they’re pulling them up. In the holes left behind they’re planting khat, an amphetamine like stimulant, that is rapidly taking over.

Ahmet Mooai, a gaunt father of eight, explains how his family has grown coffee here for generations. Until a few years ago they could get around £2 for a kilo of coffee, which was enough to scrape a living. But now they struggle to get more than 60p. That, he says, he simply not enough to live on. His salvation, if that is not a misuse of the word, has come in the form of khat. It is easier to grow, less prone to pests and can be harvested up to three times a year. Even more importantly it brings in around three times the income of coffee. As a result Ahmet has ripped up his coffee bushes and grows nothing but khat.

Ahmet says his family has now left potential starvation behind, but now they and their community have a new problem. "Everybody is addicted. The more we chew khat, the more we become addicted. So everybody is addicted because everybody chews khat every day." The leaves, which are rich in caffeine, give those who chew them more energy. This means they can work harder. When the effects wear off, it is time to chew some more and so it goes on. Children as young as 12 years old chew khat here each day and so does virtually everyone else.

Over the mountains in the valley beyond the scene looks the same. My driver points through the window: " Look over there the field is covered with khat crops. This was the main area for coffee farms but as you can see the whole field is covered with khat bushes." We stop by another field where only a few coffee bushes remain amongst a forest of khat plants. Farmer, Ayalay Abduli tells me how falling coffee prices are forcing him to start planting khat instead. "I feel sad and also angry. I pray to my Lord. We cannot educate our children, we cannot them what they need to grow. We are very angry about this because we work, we harvest but we have to sell at a low price."

Ayalay points to his wedding ring and recalls how he first wooed his wife-to-be with a hand full of beans, in a country where coffee is part of the culture. By accepting his offering she accepted him as her husband. The ritual is centuries old. Now he struggles to feed the children she gave him and is turning his back on the beans that sealed his marriage.

The Ethiopian Prime Minister, Meles Zenawi, is refusing to clamp down on the growth of khat in his country despite fears for the health of those using it. He believes that his farmers have to make a living somehow and growing khat has been forced on them by unjust international trade laws.

Meanwhile the charity, Oxfam is calling on the firms to agree to a list of demands. It wants them to agree to buy fair trade coffee, (where a minimum price is guaranteed to farmers and no middle man exists to reduce their profits) to only trade in coffee that meets International Coffee Organisation standards and to reduce the current coffee surplus by destroying five million bags.

Such a commitment, Oxfam claims, could help up to 25 million coffee farmers worldwide. None of the big coffee companies have yet given any indication that they are prepared to follow all, or in some cases, any of these rules. Nonetheless, the Director of Oxfam UK, Barbara Stocking says people power might yet persuade them and she wants British coffee drinkers to go on the war path: "They should be telling the big companies, the Nestles, the Sara Lees, that it is really not on to be doing this. To be paying 1 %  of what the coffee is to the coffee farmer. I mean, it’s just absolutely outrageous and we need people to show their concern about that."

Ethiopia has lost around £600 million in export earnings over the last five years due to the falling price of coffee on the global markets. A crushing blow for an impoverished country that is the third poorest in the world. The slide started recently when Brazil, the world’s biggest coffee exporter, greatly stepped up production, mainly of cheaper grade coffee. It was followed by Vietnam. The result was a glut of coffee that caused prices to nose dive.

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