As Temperatures Warm, Your Favorite Warm Beverage is Under Threat

Coffee supply chains are already feeling the impact of climate change

While pundits and politicians debate climate change’s existence, companies like Starbucks are taking action. Starbucks is built on high-quality coffee beans from a supply chain of 300,000 growers worldwide. Global warming is a growing threat to this supply chain—demand is soaring, but coffee’s future as a global product is uncertain [1].

Starbucks relies on dependable access to coffee beans and even small global temperature increases impact these crops. The most extreme climate change models show profound, permanent changes to coffee yield and quality [3]. Research indicates that key Arabica bean regions may see suitable land reduced by 48-70% by 2050 [4].

Coffee tree ecosystems are sensitive balances of sun, water, and species. Rising temperatures mean increased pests, invasive fungi, and crop illnesses [5]. In some coffee regions, farmers can move to higher elevations to escape these conditions, but moves require massive coordination and funding. Other regions simply have no higher-altitude options (ibid).

Our understanding of climate change’s impact is evolving. For example, recent research found that global warming’s decimation of bees will also impact coffee—bee species extinction will make it harder for coffee trees to receive necessary pollination [6].

 Starbucks’ Commitment to Sustainability Heats Up

Starbucks has long championed sustainability and implemented a company-wide climate change strategy in 2004 [7]. The organization uses short-term and longer-term tactics to protect supply chains as they ramp up climate change mitigation and adaptation efforts worldwide.

Starbucks adjusted their operational practices—from coffee transportation to the materials used in its stores—to reduce their emissions footprint. These efforts have had mixed impact (energy use from heated food has outpaced reduction efforts), but company remains committed [8]. For 2017’s National Coffee Day, Starbucks broke with their free coffee tradition. Instead, customers saw store menus illustrating climate change’s impact on coffee and how Starbucks helps farmers weather changes [9].

Globally, Starbucks is strengthening their supply chain over the long term by focusing on growers. Nine Farmer Support Centers across key regions work with farmers to improve crop yields [10]. These supports are free and designed by in-house agronomists (ibid). This year, Starbucks committed to giving farmers 100 million disease-resistant coffee tree seedlings by 2025 [11].

Innovation Must Continue

As growers search for new land, there is a risk that resulting deforestation may worsen global warming [12]. Starbucks can use grower relationships to prevent deforestation. Now is also the time to build partnerships with agriculture departments in growing regions and play an even more active role in preserving coffee output.

Science presents exciting, longer-term opportunities. The recent sequencing of the Arabica coffee bean genome opens the door for new plant varieties [13]. Engineering plants that are disease resistant and drought resistant plants would strengthen supply chain security.

Alternatively, the future may lay in new supply chains. As climate change models evolve, new coffee growing regions may emerge. Starbucks must stay deeply informed and be prepared to shift resources as needed.

It Won’t Be Easy

How does a brand change the world: Is there an opportunity to put lobbying dollars behind climate initiatives and candidates? Can and should Starbucks aggressively engage with customers—especially in areas that have traditionally been skeptical of climate change science?

From bean to beyond: Is there the potential for a viable, high-quality synthetic coffee alternative? Would coffee aficionados ever accept alternatives?

(800 Words)

Sources

[1] Timothy Killeen and Grady Harper, “Coffee in the 21st Century: Will Climate Change and Increased Demand Lead to New Deforestation?” April 2016. Conservation International. Accessed November 10, 2016.

[2] BBC World News, “Coffee Under Threat”. Accessed November 12th, 2017  http://www.bbc.co.uk/news/resources/idt-fa38cb91-bdc0-4229-8cae-1d5c3b447337 . Image data sources: International Coffee Organisation, Christian Bunn (Climatic Change Journal)

[3] Puneet Kollipara, “Climate change could slash coffee production”. December 17, 2014. Science Magazine. Accessed November 9, 2017. http://www.sciencemag.org/news/2014/12/climate-change-could-slash-coffee-production

[4] BBC World News, “Coffee Under Threat”. Accessed November 12th, 2017  http://www.bbc.co.uk/news/resources/idt-fa38cb91-bdc0-4229-8cae-1d5c3b447337

[5] Union of Concerned Scientists “Coffee and Climate: What’s Brewing with Climate Change?”. Accessed November 9, 2017. http://www.ucsusa.org/global_warming/science_and_impacts/impacts/impacts-of-climate-on-coffee.html#.Wgu_x2hSw2x

[6] Pablo Imbach, Emily Fung, Lee Hannah, Carlos E. Navarro-Racines, David W. Roubik, Taylor H. Ricketts, Celia A. Harvey, Camila I. Donatti, Peter Läderach, Bruno Locatelli, and Patrick R. Roehrdanz. Coupling of pollination services and coffee suitability under climate change. PNAS 2017 114 (39) 10438-10442; published ahead of print September 11, 2017, doi:10.1073/pnas.1617940114

[7] Starbucks Social Responsibility, “Climate Change”. Accessed November 12, 2017.  https://www.starbucks.com/responsibility/environment/climate-change

[8] Starbucks Social Responsibility, “Climate Change”. Accessed November 12, 2017.  https://www.starbucks.com/responsibility/environment/climate-change

[9] Starbucks Newsroom “Why your Starbucks looks different this National Coffee Day”, September 28, 2017. Accessed November 10, 2017. https://news.starbucks.com/news/national-coffee-day-2017

[10] Starbucks Newsroom, “On the ground support for Farming Communities”. Accessed November 10, 2016. https://www.starbucks.com/responsibility/community/farmer-support/farmer-support-centers

[11] Starbucks Newsroom “Starbucks to Provide 100 Million Healthy Coffee Trees by 2025”, April 17, 2017. Accessed November 9, 2017. https://news.starbucks.com/press-releases/starbucks-100million-coffee-trees

[12] Lulu Garcia Navarro, “Coffee And Climate Change: In Brazil, A Disaster Is Brewing”, October 12. 2016. NPR. Accessed November 12, 2017. https://www.npr.org/sections/thesalt/2016/10/12/497578413/coffee-and-climate-change-in-brazil-a-disaster-is-brewing

[13] Pat Bailey, “Arabica Coffee Genome Sequenced”. January 13, 2017. UC Davis News. Accessed November 15, 2017. https://www.ucdavis.edu/news/arabica-coffee-genome-sequenced/

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4 thoughts on “As Temperatures Warm, Your Favorite Warm Beverage is Under Threat

  1. This is a fascinating topic Sarah, and something that I also believe will play a fundamental role in the near future, not only in coffee but in the supply chain of many other agricultural products. As you succinctly highlighted, the most vulnerable part of the coffee’s supply chain is the sourcing of high-quality coffee beans, and this is pivotal for Starbucks as they continue to consolidate their brand.

    I found the interplay between coffee bean production, quality and climate change as fascinating as frightening as recently has been suggested that nearly 90% of the current coffee production in Latin America could be compromised by 2050 if the climate change trend continues (https://goo.gl/QSfC6u). I fully agree with your assessment that company leaders in the coffee industry such Starbucks or Lavazza should take a most active role to continue innovation that translates into a more robust supply chain.

    I do agree that mitigating global warming by implementing sustainable practices is a lofty mission that every company must incorporate in their supply chains and at every level in an organization. However, I am skeptical of companies taking the lead of educating others such as customers, governments or competitors about climate change because it could alienate some customers and create a bad spirit with competitors. On a more positive note, I believe they should continue creating secondary awareness through campaigns that are not directly intended to bring up the topic but that definitely openly discuss it as a part of the corporate culture (e.g. using recycle cups on earth’s day, or asking customers to bring their own cup once a month instead of using disposable ones).

    Most of the coffee producers are small growers that lack the infrastructure to implement strong changes on its own as recently described in this article in the Guardian (https://goo.gl/aCoa5w). They went even further to suggest that the main steps to address this issue lie on the farmers, small growers and the ability to develop new technologies (https://goo.gl/zeBQM6).

    In addition, the Climate Institute released a report in August 2016 (https://goo.gl/nn6wwF) informing that the production is declining at alarming rates while farmers are on their own to try to solve this complex and global issue.

    Lastly, about finding alternatives to replace coffee beans, several people have tried to circumvent the use of this millennial bean but failed in finding the right mixture of unique flavor, distinct color, aromatic depth. Perhaps this is because this drink is more than a staple in our society and it has become a tradition and a morning ritual for a continuously growing fan base.

  2. This was a very insightful essay that is near and dear to my heart as an avid coffee aficionado. I strongly agree that Starbucks – as the largest purchaser of coffee beans – has a responsibility to set the standards for sustainability and that innovative solutions (like bio-engineering more sustainable coffee beans) are necessitated.

    While Starbuck’s immense supply chain is predicated on 300,000 growers, I wonder if the incremental costs – for example, pushing more sustainable bean production – that Starbucks would pass on to these growers will be viable longer-term. My concern arises from the fact that the largest coffee producing geographies are Brazil, Vietnam, Colombia, Indonesia and Ethiopia – all of which are developing countries with pronounced economic sensitivities in the farming communities (Source: National Coffee Association). I therefore think that Starbucks would likely have to eat much of the incremental costs associated with sustainably sourced beans, and I wonder if the company’s public investors would support thinning margins (particularly as Starbuck’s growth prospects begin to wane globally).

  3. Really interesting post Sarah! One point I found very interesting (in this article and a few others) is how companies and governments tend to invest in projects to mitigate the impact of climate change on their operations. Initiatives, like the ones you mentioned (e.g. move coffee bean growers to higher altitudes, develop new coffee bean varieties) tend to help in the short and medium term, but at least in my opinion are not enough to solve the problem.

    Given the size of Starbucks operations, I think reducing the company’s carbon footprint, informing their customer base of the effects of climate change and pressuring the government to implement stricter regulations on greenhouse gas emissions can have a great impact. From your article, you can see that they have made progress in the first two but not on the last one. Unless Starbucks and other private companies can lobby for regulation that would reduce carbon emissions, it’s going to be and uphill battle.

  4. Sarah, I hope they find a solution because coffee is already an integral part of my daily diet! Brazil is one of the largest coffee bean producers and exporters and this topic is of special interest to us. By far the variety that is mostly cultivated in Brazil is the Arabica, which is apparently fairly sensitive to climate changes. There is a governmental agency there called “Embrapa” that is focused on agricultural research and they have a division fully dedicated to coffee beans (www.embrapa.br/cafe). Similar to what you described in your article, their intention is to continuously improve the beans yield, resistance, and quality, creating value to the whole coffee chain in Brazil. It would be nice to see more public-private partnerships fostering research in institutions like Embrapa, because as Alejandro mentioned, moving growers seem to be only a short-term solution for the problem. I also believe that soon we´ll reach a limit on how much we can improve the coffee bean/tree in order to withstand these uncommon climate changes, but without tackling the root causes we will not prevent a future production decline. Large economies have been highly dependent on the cultivation of coffee since the 18th century, and the habit of drinking coffee has penetrated all levels of society in many countries. If actions are not taken today, either we´ll see an increase in prices or this pleasant drink will simply vanish from our diet (which would be a pity…). How would we survive 15 cases a week without that delicious espresso shot in the morning?

    Thanks for sharing!

    Thiago

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