To a coffee addict who consumes two-plus cups a day, a coffee shortage is a frightening prospect. Unfortunately, the coffee industry is extremely susceptible to changing weather patterns and rising temperatures caused by global climate change. According to recent studies, 80% of the fertile coffee-growing land in Brazil and Central America, and 50% of coffee-growing land globally, could become unsuitable by 2050 . This decline is growing land will likely result in a drop in global coffee supply and a rise in coffee bean prices .
One of the main reasons why coffee is sensitive to climate change is that 70% of global coffee production comes from a single species: Coffea Arabica . Arabica coffee is typically found in tropical highlands around the world, and requires relatively cool temperatures and high amounts of annual rainfall . Brazil’s recent drought has already pushed coffee prices up, and effects are expected to worsen as temperatures continue to rise . The impact of climate change will fall heavily on the millions of people around the world who make their living in the coffee trade. An estimated 25 million farmers worldwide produce 80% of the world’s coffee, and another 100 million people around the globe depend on coffee trade for subsistence .
Starbucks is keenly aware of the challenges climate change poses to its business model. As temperatures rise and growing land becomes unusable, the global supply of Arabica beans will shrink, and Starbucks supply costs will rise. Starbucks could be forced to source coffee from new suppliers and establish costly new supply chain routes . To address this threat, Starbucks is focused on reducing its own environmental footprint while working directly with farmers to prepare for changing growing conditions.
Starbucks has been focused on renewable energy and energy conservation since 2004 . Starbucks is one of the EPA’s top ten purchasers of renewable energy, purchasing Renewable Energy Certificates (RECs) equivalent to 100% of the energy used in U.S. and Canada company-owned stores . Each REC helps subsidize the electricity price supplied by wind farmers to better allow the renewable source to compete with fossil fuels . In addition, Starbucks installed energy management systems in 4,000 stores to better control heating and cooling costs . Starbucks also builds new stores according to LEED (Leadership in Energy and Environmental Design) principles, and has more LEED-certified stores than any other retailer . Finally, Starbucks is a member of the RE100, a global initiative of businesses committed to 100% renewable electricity .
Beyond limiting its environmental impact, Starbucks works directly with growers to assess the impact of climate change on production and experiment with novel growing techniques. These actions range from using shade and tree cover to protect crops and farmers from the sun, to more novel approaches . In 2014, Starbucks sold its first batch of a special coffee variety developed with a Costa Rica growing cooperative . This coffee strand, named Geisha, is more resistant to fungal infections than other species and may signal future experiments in coffee growing innovation . Starbucks has historically been generous with its discoveries: in 2014 the company distributed rust-resistant coffee plants to Mexican farmers who had lost much of their annual production to seed rust, and will have donated 20 million rust-resistant seedlings by the end of 2017 .
Starbucks’ commitment to addressing climate change is admirable, but has at times been at odds with its business imperatives. While Starbucks is meticulous in tracking its environmental impact, it has not always been successful at reaching its emissions-reduction goals.
After setting a 25% reduction goal in 2008, Starbucks saw emissions rise in recent years, due primarily to store growth and its foray into heated food, which requires an increase in refrigeration and ovens  . I am encouraged by the steps Starbucks has taken to date, but I am concerned as to how it will balance growth targets and pressure from shareholders with its stated desire to reduce emissions. Similarly, Starbucks seems genuinely committed to working to equip impacted farmers with the tools and knowledge needed to grow beans in changing climates. However, there is probably a limit to this investment, where Starbucks will limit innovative farming experiments and instead simply pass higher bean prices to consumers. Given the 125 million people worldwide who depend on the coffee trade for their livelihood, I would like to see Starbucks lead the effort to determine how to successfully grow beans in warmer and dryer climates. Perhaps Starbucks could partner with research universities and tech companies to produce truly innovative farming methods. Given the impending coffee crunch, a new blend of methods and company commitment will be required to address the impact of climate change.
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1 Byrnes, Natalia. “Starbucks Responds to Climate Change, with Mixed Results.” MIT Technology Report. https://www.technologyreview.com/s/601404/starbucks-responds-to-climate-change-with-mixed-results/. Accessed 3 Nov. 2016.
2 Chamlee, Virginia. “Coffee Market Braces for Global Warming’s Effects.” Eater. http://www.eater.com/2016/5/10/11642246/coffee-bean-global-warming-starbucks-latte Accessed 3 Nov. 2016.
3 Bunn, C., Laderach, P., Rivera, O., and Kirschke, D. “A Bitter Cup: Climate Change Profile of Global Production of Arabica and Robusta Coffee.” Climactic Change, vol. 129, no. 1, 2015, pp. 89-101, http://link.springer.com/article/10.1007/s10584-014-1306-x.
4 “Climate Change Brews Trouble for Coffee.” Clean Technica. https://cleantechnica.com/2016/10/05/climate-change-brews-trouble-coffee/. Accessed 3 Nov. 2016.
5 Perez, Marvin G. “Coffee-Loving Millennials Push Demand to a Record.” Bloomberg. http://www.bloomberg.com/news/articles/2016-10-30/millennial-hunt-for-caffeine-fix-propels-coffee-demand-to-record. Accessed 3 Nov. 2016.
6 “Coffee Farmers.” Fairtrade Foundation. http://www.fairtrade.org.uk/en/farmers-and-workers/coffee. Accessed 3 Nov. 2016.
7 “Climate Change.” Starbucks. http://www.starbucks.com/responsibility/environment/climate-change. Accessed 3 Nov. 2016.
8 “Water and Energy Conservation.” Starbucks. http://www.starbucks.com/responsibility/environment/climate-change. Accessed 3 Nov. 2016.
9 “LEED® Certified Stores.” Starbucks. http://www.starbucks.com/responsibility/environment/leed-certified-stores. Accessed 3 Nov. 2016.
10 “RE100.” The RE100. http://there100.org/re100. Accessed 3 Nov. 2016.
11 “Six Years in the Making, Starbucks Reserve Costa Rica Geisha La Ines Honors Agronomists and Farmers.” Starbucks Newsroom. https://news.starbucks.com/news/six-years-in-the-making-starbucks-reserve-costa-rica-geisha-la-ines. Accessed 3 Nov. 2016.