Coffee companies hurting third world farmers - Oxfam

The world’s largest coffee companies are destroying the lives of millions of impoverished third world farmers, Oxfam International claimed on Wednesday.

It blamed the big four roasting companies – Kraft, Procter & Gamble, Sara Lee, and Nestle – for driving subsistence farmers into even greater hardship.

“There is a crisis destroying the livelihoods of 25 million coffee producers around the world,” Oxfam said in its report entitled 'Mugged – Poverty in your coffee cup'.

“Despite the stagnant consumer market, the coffee companies are laughing all the way to the bank," the report said. “With farmers getting a price that is below the cost of production, the companies’ booming business is being paid for by some of the poorest people in the world.”

The report, which was launched on Wednesday in Uganda and Ethiopia, added: “The coffee crisis is becoming a development disaster whose impact will be felt for a long time. The coffee market must be made to work for the poor as well as the rich.”

Ethiopia – the birthplace of coffee and Africa’s leading exporter– has been crippled by the huge slump in prices making it more dependent on aid from rich nations. Coffee accounts for more than 60 percent of exports generating vital income for its 65 million population – more than half of whom live on less than a dollar a day.

Ethiopia’s coffee income dropped by US $110m compared to the $58m it is set to save in debt relief this year, hitting the one million families who are dependent on coffee for their income.

Oxfam also criticised the World Bank and the International Monetary Fund for encouraging countries into export-led growth without warning them about the potential of catastrophic price falls.

The International Coffee Organisation say that world coffee prices have slumped to record lows – falling by more than 70 percent in the last four years alone.

The coffee campaign is part of Oxfam’s fair trade strategy designed to make consumers aware of the importance of trade and globalisation in the fight against poverty.