WASHINGTON, D.C., US – The U.S. Agency for International Development (USAID), in partnership with Keurig Green Mountain, Inc., Cooperative Coffees, Starbucks, and Root Capital, yesterday (Thursday, June 19, 2014) launched the Coffee Farmer Resilience Fund.
The aim of the Fund is to leverage $23 million in financial assistance for more than 40,000 coffee farmers combating the devastating coffee rust outbreak in Latin America and the Caribbean. Since 2012, coffee rust has affected more than two million people in Latin America, causing an estimated $1 billion in economic damages which could lead to 500,000 job losses.
“This dynamic partnership will leverage our joint expertise, along with that of the private sector, to help tens of thousands of rural farmers boost their incomes and rise out of poverty,” said USAID Administrator Rajiv Shah.
“Through innovative approaches to farming, we can help these men and women combat the worst outbreak of coffee rust in Latin American history – and lay the foundation for broad-based economic growth for generations to come.”
The Fund will:
- Leverage $8 million in funds from USAID and partners, including Keurig Green Mountain,Cooperative Coffees, and Root Capital, to provide on-farm, agronomic trainings on climate-smart, resilient practices to coffee farmers and farmer organizations in Mexico, Guatemala, Honduras, El Salvador, Nicaragua, and Peru.
- Unlock $15 million in investment capital from Root Capital, including $3 million in new investment from Starbucks, through a USAID credit enhancement for long-term financing for rehabilitation of disease-affected fields and short-term financing to stabilize coffee supply chains in Latin America and the Caribbean.
- Enable participating coffee roasters to negotiate the cost of combatting coffee rust into their purchase contracts with farmer organizations to ensure sustainable solutions rather than one-time charitable gifts.
The pooled funds will provide technical assistance, leading to sustainable supply chains and increased farmer incomes in the short and long term.
Additional coffee buyers and roasters are expected to join the Fund over the next two growing seasons.
“Coffee leaf rust is a critical industry issue that requires a collective approach,” said Lindsey Bolger, vice president for coffee sourcing excellence at Keurig Green Mountain.
“We are proud to partner with USAID, Root Capital, and fellow roasters on this expansion of the Coffee Farmer Resilience Initiative, which will unlock new resources for coffee farmers for agronomic training, rust prevention, and other resiliency investments that are necessary to combat this crisis affecting those growing the high-quality coffee our consumers enjoy.”
Overall, USAID is investing $18.5 million to combat coffee rust in Latin America and the Caribbean and leveraging a total of $26 million in private sector investment.
This includes the recently announced partnership with the Norman Borlaug Institute for International Agriculture at Texas A&M University to support research that will help establish a more resilient and higher-quality regional coffee sector.
The new Fund builds off of Root Capital’s existing Coffee Farmer Resilience Initiative, which leverages funding from a variety of partners including the Inter-American Development Bank.
“The staff and members of Cooperative Coffees are thrilled to participate with USAID, Root Capital and Progresso Foundation to support grassroots farmers’ cooperatives responses to the Coffee Rust crisis,” said Cooperative Coffees Executive Director Jonathan Rosenthal.
“We see this kind of public/private global collaboration as an effective targeted response to a crisis that finances small scale farmers to use local approaches to confront difficult problems.”
“The scourge of coffee leaf rust forces us to recognize that coffee may be the proverbial canary in the coalmine for climate change’s destructive impact on agriculture,” said Willy Foote, Root Capital founder and CEO.
“Responding to complex issues in agriculture requires precompetitive, pathological collaboration among all partners in the supply chain – successfully doing so is good for farmers who depend on coffee for life, for companies that rely on high-quality coffee to sustain their businesses, and for consumers who are unwilling to witness the extinction of their morning Joe.”
“By working with other like-minded organizations such as USAID and Root Capital, we can we ensure positive impact and sustainable change at scale” said Craig Russell, executive vice president, Starbucks Global Coffee.
“We are heavily invested in helping farmers manage through changes in weather or conditions like coffee rust and this new commitment of $3 million—as part of our broader $20 million farmer loan program—ensures that farmers will receive access to the resources and capital necessary to adapt to these uncertainties and secures the longevity of our industry’s supply chain.”
