Sara Lee, Kraft: more baby steps

by on February 25, 2011

Sara Lee and Kraft both announce increases in purchase of certified coffees: what does this mean?

Sara Lee
Sara Lee (Senseo, Java Coast, Douwe Egberts, etc.) recently announced a five-year goal of tripling the amount of Utz Certified coffee it purchases. I love how this was spun: that in the past five years, Sara Lee had purchased 110 million kilos of Utz Certified coffee. That sounds like a huge amount, but 110 million kilos is 110,000 metric tons over five years. This is a little over 20,000 tons per year of the 450,000 tons that they purchase annually — less than 5% of their purchases. Indeed, this is right in line with what we learned in my previous post Certified coffee: current market share, part 2.

The article goes on to say that Sara Lee is “committed to more than triple that amount in the next five years and purchase at least 350 million kilos across all its markets and product segments.” My emphasis added.  All product segments, as the piece goes on to say, includes tea (e.g., Pickwick and Hornimans brands in Europe). Sara Lee purchased 2000 tons of Utz Certified tea in 2010, so a tripling of that amount has to be factored in to get to their goal of 350 million kilos. If met, this goal means that in 2015, certified coffee will still only be 15 to 20% of their total coffee purchases. And Utz currently does not have significant environmental standards.

Sara Lee also just revealed that due to rising coffee prices, it will be reformulating some of its coffee blends to include more cheap robusta beans. You know — the ones typically grown as sun coffee.

Kraft
Kraft (Yuban, Maxwell House, General Foods International Coffee, Gevalia, Kenco, Maxim, Tassimo, Nabob, and Sanka) has reported that they increased the amount of Rainforest Alliance certified coffee they purchased to 110 million pounds in 2010. If we drag out the calculator again (and round up for the sake of simplicity) we see that is 50,000 metric tons…out of the 740,000 tons they purchase each year, or less than 7% of their total purchases.

Coffee image by bitzcelt under a Creative Commons license.

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Revised on March 23, 2014

Posted in Corporate coffee

Jim February 26, 2011 at 8:23 am

Yet, from the other side of their mouth, they (Sara Lee) say they will be buying more robusta to bring down cost (unlikely to carry any certifications).

JACraves February 26, 2011 at 8:28 am

Yep, link is up there. Unsettling to think that high coffee prices may cause some additional environmental damage, at least in the short run, as companies turn to robusta, and cheap consumers turn to those companies. I just hope producers learn from history and don’t go gung-ho planting coffee like crazy and create oversupply down the road.

Jim February 26, 2011 at 11:07 am

What I hear in my travels around the globe is “watch out for China”. Imagine an almost unlimited supply of cheap, mediocre coffee at a 30% discount to the world price. Americans will be thrilled.

bwaba shamba March 16, 2011 at 3:47 am

As a coffee producer in Africa, I tend to see it in a different light, I like your list below of recomended roasters, but judging from the coffee they buy, their total amount is no where near the 50,000 MT Kraft is buying as Rainforest alliance. I think we are so affected by a world full of negative things that we fail to recognise the positive steps that make this world a better place. Being involved in certification in the origin, you will be amazed how projects funded by this big companies we loath have helped fill the gap previously taken care of by governments till the structural adjustment progrsms of IMF whiped this help out. In africa for instance the small holder is dealing with challanges of low yeild, poor quaality, ancient plants, low income thus low or no inputs into his coffee. We ate talking of 60000 farmers producing just an average of 1 bag each and supporting a household of an average 6 persons, that is about 250 usd a year. buying that bug for 10% more and singing to the whole world how you are making a difference in the world is a big joke, or like some of the roasters down here do then buying it for 500 usd.
Sorry but we need the masses, we need to enable the 60000 farmers improve their yeild from 390 kg per hectare to the current average in bigger producers like colombia of 1800 kg per hectare, this by the way would increase our production 5 times and even if we stick with the lower multinational prices, this is still $ 1,250 per year for a household.
The 2 people you just talked about are involved in projects on the ground due to their might to make this happen. The choice is yours, we can sit in small exclusive cafes in high end streets sipping very expensive coffees bought from very few farmers at double the price, or we can support mainstream efforts that ensure the whole coffee producing regions become sustainable and all farmers increase their incomes five fold by supporting the efforts of the bigger guys more by encouraging them than breaking their will, I really admire the big guys that they are willing to continue even as we critisize every small step they make.
Lucky for me due to some of the coffee proceeds I can read and blog and diversify my income, but this is not true for thoudands of neighbours in the vilage and for their sake I will ensure the word gets the true picture.

Asante

JACraves March 16, 2011 at 7:24 am

Asante, thanks so much for your reply. I’m very interested in hearing your perspective.

I applaud the efforts of any company doing worthwhile work to improve the sustainability of coffee production — whether it is a small roaster working with a single farm, or a big corporation working with thousands. The problem is that companies such as Sara Lee or Nestle make a small effort (often in response to consumer attitudes) and paint themselves as doing much more than they really are. As a result, First World consumers think what these companies do is fine as it is, and people continue to buy very cheap coffee for which, considering the price Kraft and the others sell it for, is also not helping your neighbors or the tens of thousands of other producers they source from.

I want consumers to understand that big corporations need to do more — that working with farmers that supply them with 10 to 20% of their supply is not enough. I know that dealing with the volumes that they do, that they cannot do this overnight, but unless they are pushed by the market, it is unlikely to happen at all. I heard George Howell of Terroir Coffee, who has worked for many years in Kenya, that “every bean has its home.” Meaning that not very many farmers can produce specialty coffee, and that not all consumers want to buy it. Small coffee farmers the world over who produce coffee not suitable for the specialty market need to have the income provided by big corporations who buy their coffee. I say that we need to convince these corporations to expand the projects they do on the ground that you describe. My only point of disagreement is that I don’t think these companies can be convinced to do so by “encouragement.” Some have very long histories of environmental and human rights violations. I wouldn’t categorize my efforts to educate the public as “breaking their will.” They are in business to make money. If the market demands they offer sustainable coffee, they should move in that direction.

I have bookmarked your blog and hope that we can continue to exchange ideas! Thanks again.

bwaba shamba March 17, 2011 at 9:34 am

Thank you JACraves, and sorry I did not want to come out so critical, and I am a great follower of your blog since 2008 and am happy for the educating remarks, was just a bit worried that we may miss out on some of this efforts but like you say the consumers need to ask for more and I support that.

Asante (means thank you in swahili)

Bwana Shamba

JACraves March 17, 2011 at 12:00 pm

Criticism is welcome as well, Bwaba, with no offense taken. Asante to you as well (now, I have also learned a bit of Swahili!).

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