USAID and Starbucks Initiate Fund Against Coffee Rust

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POTOMAC, Md. — The United States Agency for International Development  recently partnered with Starbucks to initiate a $23 million fund that would combat the coffee rust epidemic that decimated crops in 2012.

Coffee rust, a fungus otherwise known as roya disease, coats coffee plants with an orange powder — a rust, so to speak. While the parasite is not an uncommon phenomenon for coffee farmers, in 2012 the disease wreaked unprecedented havoc, severely damaging the vulnerable coffee supply chain.

USAID estimates that coffee production will most likely decrease by 15 to 40 percent in the near future. The agency also believes 500,000 farmers are at risk of losing their jobs because of this decline.

Already, approximately $1 billion in economic losses have incurred since coffee rust’s first explosion in 2012.

Such substantial production decreases may lead to a similar faltering in the incomes of small farmers. Experts fear that these workers will no longer be able to afford the tools necessary to keep coffee rust at bay, further hampering coffee production and the farmers’ livelihoods.

From soil to brew-ready beans, coffee plants require between five and seven years to fully develop. Salvation does not come from the mere replacement of plants but long-term financing that would protect the coffee supply chain from its fragile and insecure state.

USAID understands this. Eight million of the $23 million fund was provided for by partners that include Keurig Green Mountain, Cooperative Coffees and Root Capital, a Boston-based nonprofit investment fund. This investment will finance farmer training to teach practices that will help mitigate the prevalence of coffee rust.

Root Capital additionally rounded up $15 million, $3 million of which Starbucks pledged. This large investment would fund long-term reparations of fields devastated by coffee rust and short-term loans to help small farmers stay in business.

Starbucks’ contribution comes as part of a larger $20 million loan program it currently spearheads. Last year, the Seattle-based coffee franchise bought a Costa Rican farm where they now test farming methods and experiment with new strains of coffee seedlings, to investigate innovative ways to combat coffee rust and improve the plant’s resilience.

In May, USAID announced a separate partnership with the Norman Borlaug Institute for International Agriculture at Texas A&M University. Together, they have committed $5 million to fight coffee rust.

“This partnership will tap innovative solutions to address the immediate and long-term impacts of coffee rust and help this key agriculture sector rebound,” said  USAID Associate Administrator Mark Feierstein regarding the pairing of these two organizations.

Independently, USAID has funneled $14 million toward repairing the damaged coffee supply chain.

The agency’s efforts include developing strategies for farmers, establishing coffee pest early warning systems and creating new positions in the supply chain tasked with swiftly responding to any flaring epidemics in the future.

Shehrose Mian

Sources: USAID, Seattle Times, Forbes
Photo: Aljazeera

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