Certified coffee: current market share, part 2

by on December 21, 2010

(Update: I now regularly update the post Corporate coffee: How much is eco-certified? as new information becomes available.)

I often point out that the amount of sustainably-grown coffee that various large corporate coffee roasters purchase is a very small proportion of their total coffee purchases. In a previous post, I looked at the current market share of certified sustainably-grown coffee broken down by certification. Here, we’ll look at which of the world’s major coffee buyers/roasters are purchasing this coffee.

The source of this data is the Tropical Commodity Coalition, a group of ten NGOs that puts out annual reports on various aspects of the coffee, tea, and cocoa industries.  The Coffee Barometer 2009 presents market developments in the certified coffee sector.

Among the interesting data included is a summary of the green (unroasted) coffee purchases by each of the world’s top ten coffee buyers for 2008. It highlights how much “certified” coffee each buyer purchased, including Rainforest Alliance, Utz Certified, organic, Fair Trade, 4c, and the private initiatives of Starbucks (CAFE Practices) and Nestlé (Nespresso AAA Sustainable Quality Coffee Program).

In this post, I’ll disregard coffee purchased under Fair Trade (which does not have strong environmental standards) and the 4C Code (see this post on Nestlé and deforestation for information on this bottom-rung system, which does not include environmental criteria any of us would consider as being meaningfully “eco-friendly”). I’ll leave in the Starbucks and Nespresso programs and comment on them below.

So, how much eco-friendly, sustainably-grown coffee is purchased by the big buyers?

Nestlé. Owns Nescafé, Nespresso, Taster’s Choice, Clasico. Purchased 780,000 tons of green coffee in 2008.

  • 13,000 tons under their Nespresso AAA Sustainable Quality Coffee Program, or 1.7% of total purchases –but read on. The standards used by Nestlé in this program are not publicly available. Nestlé is working with Rainforest Alliance for guidance, but currently source farms are not certified by Rainforest Alliance. From what I have been able to gather, this program probably has fewer meaningful requirements for environmental protection than Fair Trade or Utz Certified, so pegging them at 1.7% is being generous.

Kraft. Yuban, Maxwell House, General Foods International Coffee, Gevalia, Kenco, Maxim, Tassimo, Nabob, and Sanka. 740,000 tons.

  • 29,500 tons Rainforest Alliance, 4% of total.

Sara Lee. Senseo, Java Coast, various foodservice, Merrild, Kanis & Gunnink, Cafe Pilao, Cafitesse, Harris, Piazza d’Oro; Douwe Egberts is its coffee subsidiary, under which many of these brands appear. 450,000 tons.

  • 20,000 tons Utz Certified (4.4%). The Utz focus is more on traceability and the business end of the spectrum, not environmental standards.

Smuckers. Folgers and Millstone (acquired from Procter & Gamble), Kava, Dunkin Donuts grocery store coffee. 280,000 tons.

  • 1,500 tons Rainforest Alliance/Fair Trade/organic (0.5%). This is a combination of the three, rather than the total amount being triple-certified. There are few organic coffees in their line, one RA coffee (discontinued as of 2011), so the amount is heavily weighted toward Fair Trade. Because of the relatively weak environmental standards of Fair Trade, this means the percentage of eco-friendly coffee is even lower.

Starbucks. 175,000 tons.

  • 4,500 tons organic (2.6%).
  • 120,500 tons under their CAFE Practices (68.8%, for a combined total of 71.4%). I recently took a look at the environmental standards of Starbucks CAFE Practices, and found they  address many more relevant ecological issues than either Fair Trade or UTZ Certified, and they are certainly much stronger than the Nespresso program. What does this mean?

Starbucks buys nearly twice as much coffee grown under meaningful environmental standards than the four largest coffee buyers in the world combined.

Perhaps more than all nine other big buyers. And they have developed these standards, worked with farmers to meet them, and use third-party verification as part of their own corporate initiative. Say what you want about the Mermaid, they do good work on the ground.

Tchibo. 170,000 tons.

  • 5,500 tons Rainforest Alliance/Fair Trade/organic (3.2%). See note under Smuckers about this combined total.

Aldi. Purchases for their private label store brands Beaumont, Alcafe, and Grandessa Signature. 145,000 tons. Percentages not disclosed.

Melitta. Melitta, World Harvest Estate. 145,000tons. Percentages not disclosed.

Lavazza. 140,000 tons.

  • 1,400 tons Rainforest Alliance (1%).

Segafredo. Segrafredo is a brand division of Massimo Zanetti, Beverage Group, which also owns Chock Full o’Nuts, Chase and Sanborn, MJB, and Hills Bros. They grow all their own coffee on plantations in Brazil (said to be the largest plantation in the world) and Costa Rica. Presumably, the 120,000 tons quoted in the report apparently is their production, not actually purchased. None is certified.

So, not counting Aldi and Melitta, since they did not disclose how much (or if) they bought any certified coffee, the big buyers purchased 2,855,000 tons of coffee, of which less than 7% was grown under verifiable sustainable environmental standards.

As mentioned in the last post, I’ve often heard that the reason big roasters do not purchase more sustainable coffee is because there isn’t enough available. This report also gives data on the amount of certified coffee produced, versus the amount purchased. There were 124,000 tons of Rainforest Alliance certified coffee produced in 2008, a surplus of 62,000 tons that was not purchased as certified. The surplus of Utz Certified coffee was 230,500 tons. Had all this been bought, then the percentage of certified coffee purchased by these buyers would have risen to around 17%.

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Revised on March 23, 2014

Posted in Certifications,Corporate coffee

Adriana February 23, 2011 at 10:47 am

I agree in the fact that C.A.F.E. standard consider relevant ecological issues that implies the production of coffee beans. However, how are we sure that this standards are really applied in farms?
Although the C.A.F.E. program considers more relevant factors that AAA program, why is it also more credible than AAA program if it does not provide third party monitoring?

JACraves February 23, 2011 at 11:46 am

There is third-party verification of standards for CAFE Practices. Standards are verified by the same types of certifying bodies as organic certification (often, the same organizations). A list of approved certifying agencies can be found on the Scientific Certification Systems (SCS) web site.

Adriana February 23, 2011 at 12:31 pm

Thank you for your reply. However, I still have some doubts about the credibility of the certification. According to Starbucks, the company had in 2010 81% of its coffee source from farms following its C.A.F.E. program. Does that means that all this coffee is verify? In addition, the company has 10% of its coffee Fairtrade certified and another 4% Organic Certified. Does that mean that 95% of its coffee sourcing is verified?
Since SCS is not a well-know certification and since it’s a company and not and NGO, I do not understand why Starbucks gets so much credibility out of it.
In addition, I was looking at SCS website, and the results of the monitoring are not publicly available.

JACraves February 23, 2011 at 12:48 pm

1) Yes, all of the coffee Starbucks says is under its CAFE Practices standards is verified.
2) Some of those producers may also have Fair Trade and/or organic certification, while some FT and/or organic certified coffee may not be produced under CAFE Practices. Because of this overlap, the total amount is probably not cumulative.
3) You are misunderstanding how verifications and certifications work. SCS is not a certification. It is the company that helped Starbucks — as well as many other companies in many industries — develop their standards. It is a well-known and respected company. They also provide the certifying organizations with the guidelines to be able to understand the CAFE Practices standards so that they can be approved to verify them. SCS does not do the verifications themselves. They are done by approved certifying organizations located all over the world; local organizations are used to reduce costs to the producers. It’s the same way that organic certification works. The organizations that certify organic producers are not NGOs, so I’m not sure what you are trying to get at there. SCS doesn’t have records of individual audits, because they don’t do them.

Aaron March 19, 2011 at 11:05 pm

The C.A.F.E standards were developed hand in hand with conservation international, a very reputable NGO

Adriana February 24, 2011 at 5:30 am

Thank you for all this great clarifications. I’m not an expert on the field and I still have lot of thinks to learn.

Adriana May 26, 2011 at 5:26 am

Hello again. I have a question regarding Nespresso’s coffee sourcing and I would be glad if you could help me if possible. In their website, they say that: “Currently, we are working with over 25,000 farmers in five coffee producing countries, and nearly 50% of our coffee is sourced from the program. We have a new goal of sourcing 50% of Nespresso coffee from our AAA Sustainable Quality TM, Rainforest Alliance certified by 2013″. Does it mean that the 50% is RA certified or does it mean that 50% is under the program but is not necessarily 50% RA certified? Thank you in advance.

JACraves May 27, 2011 at 6:34 am

I presume if they say their goal is RA certification, than that’s what they mean.

boonkwee June 21, 2011 at 10:18 am

Hi,
In today’s coffee chain, are the coffee plantation owned by the retail chains like starbucks, peets etc. Or are these plantations still majoritry owned by small time farmers?

JACraves June 21, 2011 at 12:19 pm

Very few roasters/retailers have their own coffee farms. They purchase their beans either directly from farms and cooperatives, or representatives (coffee brokers/importers). Most of the world’s coffee is grown by relatively small farmers, with less than 5 ha or so in coffee.

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