August marked the second of many Farmer to Farmer exchanges and the end of a summer filled with thousands of miles of travel. The last stop took me to Piura, Peru to spend some time with CEPICAFE, a cooperative well known throughout the country for their success in diversification efforts with cacao, coffee, sugar, fruit production, ecotourism, and carbon capturing. As a larger secondary level cooperative, CEPICAFE works to organize 400 small organizations, grouping together 7000 total producers in the northern region of this South American country. During these troubled high market times, a trio made up of myself, Ariel Chait, an Information and Technology graduate student from Berkeley, and Clay Roper, a roaster from Third Coast Coffee Roasting Company in Austin, Texas joined forces to participate in an exchange between Cooperative Coffees and CEPICAFE. We had come to focus on fair trade strategies, participate in a roasting workshop, as well as developing an internal inventory management software to help the coop manage real-time their production flow and tracking.

After the trek to Piura and a long, sleepless night at the Lima airport, my first assignment was to make my way to the tiny mountain town of Montero to check out CEPI’s efforts to develop an ecotourism project and visit the Santa Rosa de Chonta Cooperative, a member of CEPICAFE. A collective taxi was arranged to pick me up in Piura, which before long was filled with eight other travelers, all bound for Montero. Our full car caught the eye of many Peruvian police who felt the need to flag us down, and charge (pocket) 3 soles at each stop. We laughed at our inability to trick the cops into thinking we were family and getting away with transporting more people than actually fit in the taxi, noting the wide variety of people that filled this little vehicle as we climbed up into the mountains. The stench inside the taxi seemed a little raunchy, but we all must have gotten used to it as the hours went along. We didn’t realize until we dropped off half of our crew at their small rural home and unloaded their cargo to find that it was filled with not only cilantro and potatoes, but lots of fish.

  Montero is a tiny agricultural town tucked away near the Ecuadorian border. CEPICAFE has done a great job promoting the work of its members through alternative tourism, offering visitors a comfortable, affordable, rustic lodge in the mountains and a space to get a better understanding of the experience of small farmers in Peru. Just west of the Andes, the ecolodge in Montero is far enough off the beaten track, but still boasts all the basic amenities, and more. The two wooden cabins that sleep ten people are set on a beautiful hill overlooking town and at the base of a road that winds through the mountains making up this valley. They are the perfect spot to watch the sun set and the moon rise. Tours of the coffee and sugar cane farms, visits to waterfalls and horseback riding, as well as discussions on fair trade are all possible activities at this little Peruvian hideaway.

Palmiro, an agronomist that works with producers organized under CEPICAFE offered me a ride on his motorcycle through the tiny dirt roads of Montero up and over the mountain to a village called Jilili that was home to another 80 producers organized in four different groups. Palmiro was on his way to meet with several producers, reminding them of an upcoming meeting in town. He was working with a cooperative bank that hadn’t been in the community before the arrival of CEPICAFE, offering financing to small producers throughout the area and the chance to invest a bit more in their farms. 

We climbed up, passing homes and coffee drying on tarps in the sun, donkeys hauling sugar cane, wet mills, and mountains, stopping every so often to visit with producers organized in one of the many cooperatives. We chatted about pricing, and the way the seasons are changing, and food prices before getting on our way. It was a land reminiscent of many other coffee growing communities. Later that evening, I somehow ended up at the neighboring community’s fiestas patronales, sitting alongside old women and people from the two mountain communities watching young children perform dances, old men singing broken-hearted ballads, and watching the burning of a castle decorated with fireworks. I tasted the local chicha liquor and fought my heavy eyelids until we made it back to the ecolodge just before the roosters started singing.

As luck would have it, my time at the ecolodge coincided with the arrival of a group of Ecuadorian coffee and sugar cane farmers. Forty farmers, agronomists, and cooperative leaders, and one Peace Corps member were coming from the southern region of Ecuador to participate in an exchange between farmers in each of the countries to share agricultural, organizational, and market ideas with one another. Before the farmers arrived, I settled at the ecolodge with a few of the travelers I had met in the taxi ride on the way up, laughing at the ridiculousness as they helped me wash my clothes and backpack that had absorbed the fish juices on the ride out there. They too had come to explore CEPICAFE’s organic and fair trade panela (brown sugar) processing facilities out in the mountains. CEPICAFE has been recognized throughout the country as knowing what they are doing when it comes to panela. The ecolodge served the purpose of not only diversifying the income of the cooperative, but also as a space to hold visitors; whether they are other farmers sharing knowledge, consumers learning about the process of coffee, buyers of coffee meeting the producers and seeing their product, or other entrepreneurs interested in learning from their example. The farmers here are made visible and are sharing their experiences navigating fair trade and small scale agriculture with the world.

While hiking through Raul’s three hectare farm at 1120 meters elevation, we discussed with each group their experiences with organic fertilizers, pruning, and renovating their family’s small farms. The group from Ecuador was sharing their skills in improving yields with the Peruvian coop while those organized under CEPICAFE shared their organizational and market experiences with the Ecuadorian groups. Most of the representatives from Ecuador had never exported their coffee or worked directly with buyers. They were in the process of pursuing possibilities and obtaining organic and Fair Trade certifications. This gave all of us an impromptu chance to reflect on what fair trade really means nowadays. We all agreed on the importance of being organized in cooperatives and the benefits that come with it. Technical support, commercialization, projects including trainings and alternative tourism, information on market trends, learning how to manage a small business, exchanges with different countries, and interactions with buyers and consumers were all highlights in what cooperatives bring to farmers. “But prices need improve,” Raul says. In the middle of the farm, I was put on the spot by both groups, sharing information on how the high price is affecting us as roasters and importers, tendencies we are seeing in other cooperatives throughout the region, and why it’s important to continue these long term partnerships. 

Back at CEPICAFE’s headquarters, Clay, Ariel, and myself met with commercialization director Santiago Paz Lopez, who has been well recognized lately for his critiques on the watering down of fair trade and certifications. We spent hours discussing strategies for navigating these challenging times for both roasters as well as producer cooperatives and felt honored to be there learning from Santiago and his team. Santiago was tied to the market as it dipped up and down throughout the course of the week. After buying at $2.80, the market had dropped again to $2.30 while we were there, fluctuating up to 14 points in one day. “So, do you like roller coasters?” Clay asks.

One of CEPICAFE's biggest issues right now is the high market price of coffee. In order to compete with local intermediaries, they must purchase coffee immediately from producers early on in the season before final contracts are set. This implies having access to sufficient financing. The major risk now is that when producers are harvesting, the price is high, but there's a good chance prices will fluctuate before it is time to set contracts. So, the Coop is running the risk of losing a lot of money if the market price continues to go back down. Santiago says, “If things continue the way they have been going, the fair trade premiums that should be going back to reach producers for development projects will only go to cover the loss that the coop has been hit with." Roasters and importers too run the risk of buying too high and selling too low as well as finding enough financing to buy coffee at these prices. And with a market so unpredictable, it is nearly impossible to know what is the best solution right now.

In such troubling times, cooperatives are at risk of losing their strength. And this is a problem because the cooperatives that reach these coffee growing communities are about much more than just businesses, but rather they are a development tool, offering trainings, political lobbying to push for more recognition and resources, agricultural technical assistance, infrastructure, marketing, connecting with buyers and partners in different countries, prefinancing, etc. With few resources, it is impossible to compete with the large multinational corporations with an abundance of cash in hand, paying higher prices than cooperatives are capable of.

"Price is the most important thing for producers," Santiago says, “In the end though, it is still a market and it ends up just being the same as conventional. The problem is that it has turned into a business and we can never compete with the large corporations’ access to cash. Now we are a part of this market where it is very difficult for the smallest players to survive.” Although most of CEPICAFE’s members have remained loyal, many are saying that some cooperatives won’t make it through these troubled times.

Another challenging part right now is how to communicate issues within fair trade to consumers, as neither to confuse them nor undermine the hard work that thousands of people have put into the rise and large scale recognition of fair trade. When fair trade came about, it was easy to explain why it was important to support it because the difference in price was so drastic. As fair trade becomes watered down with the entrace of larger corporations, other certifications are popping up, but it's difficult to know at this point where any of those options will lead us.

As we’ve seen from farmer cooperative to farmer cooperative throughout the Americas, individual farmers may be benefiting from this rise in world market prices, but when confronted with high competition, fair trade cooperatives are facing more difficult times. As food prices rise and standards for fair trade and organic coffee become more strict, farmers are faced with a difficult decision to make. It is important to keep ourselves in check and reflect on how to continue to move forward as the market does it’s thing. So, we ask ourselves what are fair trade’s other advantages? What is left when we can no longer focus on higher prices? And how do we sustain these relationships and cooperatives that have been growing for years? Continuing to diversify and exploring other markets for producers, focusing on long term relationships with alternative buyers/producers, decreasing costs, providing access to financing, agreeing on movement strategies with other allies, and educating buyers and consumers about high prices are a few strategies we have considered.

Now back in country, it’s time to share what’s happening on the ground and work together with consumers, cafes, grocery stores, and everyone else to navigate these troubled times in the coffee world to continue to fight for a space for roasters and producer cooperatives. So, look for Just Coffee around town this fall as we join the community to talk about these issues with you while at the same time advocating for small farmers in our backyard. Stay tuned for announcements!