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Sustainable Coffee Push Bodes Well For Brazil - Study

SAO PAULO (Dow Jones)--Brazil's coffee farmers and traders should outperform other coffee-origin nations once the sustainable coffee trade becomes mainstream, according to a study released in Brazil on Friday.

The report by the Totum Institute, a private consulting firm, said Brazil coffee farmers already follow most if not all of a list of growing demands for sustainable farming being made by international coffee roasters.

"Brazil will get a competitive edge once sustainable coffee purchases start to go mainstream because farmers here run their operations very differently than in nations like Vietnam, where you still see children harvesting coffee beans," said Fernando Giachini Lopes, director of the Totum Institute.

European coffee importers sustainability program, known as the Common Code for the Coffee Community, will kick off later this year. The program, known as the 4C's, was created in response to labor and environmental group pressure on the name-brand coffee brands, saying that the coffee those companies sold was harvested by children, slave labor, or in new deforested areas.

Under the program, the major roasting house agree to increase imports of coffee grown by farmers following sustainable practices. That means a strict adherence to environmental laws, including a near zero-tolerance for new deforestation, labor policies that ban child labor and require all workers to be registered and have sanitary working conditions, and proper disposal of agrotoxins.

Of the 11 properties Totum researchers visited, all were following these practices already.

"The idea is not to award or provide an instant premium to these properties. The idea is really to start weeding out from the market the producers who are not following the 4C's," Lopes said.

In the near term, however, 4C coffee might receive a premium to provide incentives to the market and producers to improve farming practices and labor conditions. But in the mid- to long-term, the sustainable coffee trade will be mainstream and not receive any price differential, Lopes said.

The 4C is not a label and will not be permitted on individual packaging, but will appear on coffee bags getting shipped to roasters in order to distinguish it from other beans, according to Lopes.

Lopes said Brazil could export as much as 500,000 60-kilogram bags of coffee recognized as 4C in the 2007-08 crop.

"In three or more years, you would likely see the entire crop qualify as 4C," he said.

Brazil is the world's No. 1 coffee producer and exporter, shipping roughly 26 million bags to world markets each year.

-By Kenneth Rapoza, Dow Jones Newswires; 55-11-3145-1488; kenneth.rapoza@dowjones.com

(END) Dow Jones Newswires

March 19, 2007 16:33 ET (20:33 GMT)

fonte:
Veículo: Dow Jones
Data: 19/03/2007

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