“The most important resource a customer, coffee brand or even the roaster has in the coffee industry is the relationship with a farmer,” said Thrive Farmers’ co-founder and chief sustainability officer, Ken Lander, from his small coffee farm tucked away in the village of San Rafael de Abangares, Costa Rica.
Lander, a recovering lawyer who retired 12 years ago and is now a coffee farmer in Costa Rica, initiated Thrive’s unique, farmer-direct model when he found himself struggling to provide for his family while relying on the unstable market to set his wage.
Why such a vast difference? In the traditional coffee supply chain model, farmers relinquish the rights to their coffee at the very first step of sale, while multiple middlemen trade and speculate with prices based on a volatile and low commodity market price, leaving farmers to supplement income with other crops and jobs.
This traditional business model — one where there is no relationship between the farmer and customer, and where the farmer only sees a mere sliver of his or her rightful earnings — didn’t sit well with Lander, so he and his co-founder, Michael Jones, set out to change the industry. Both men have a vision and desire to change the way companies, including NGOs, engage with coffee farmers.
Thrive Farmers empowers farmers with direct relationships and no middlemen. This direct relationship between farmer and customer ensures coffee farmers have not only consistent and stable prices, but stable earnings that are greater than double those generated through the traditional coffee supply chain model. Farmers are involved through the entire process; receive a stable, predictable wage; and can plan and invest for a better life for their families. Without a direct relationship with consumers and a stable and predictable income, farmers barely make enough to support their families, their children are often not interested in taking over the farm due to the lack of profit or consistency, and the future of coffee farming looks increasingly bleak.
This was a concept Lutheran World Relief (LWR) wanted to incorporate into its decades-old international work to help some of the world’s poorest communities build the resources they need to thrive.
Currently a $100 billion industry, the demand for coffee is only going up. Despite this, coffee farmers are making less than they were 25 years ago, once adjusted for inflation. With the average coffee farmer approaching 60 years of age, there needs to be a change and it needs to be sooner rather than later.
“It’s been the elephant in the room for a long time,” Rick Peyser, senior relationship manager of coffee and cocoa for Lutheran World Relief and long-time advocate for farmers, said of the unsustainable traditional business model.
Peyser read about Thrive’s initiatives in The New York Times in 2013. The common core values he saw in Thrive alongside its innovative approach to relationships piqued his interest, and so began the conversation about how to unite in the transformation of a broken industry.
Lutheran World Relief has worked to improve coffee farmers’ livelihoods, including training and preparing farmers in the case of environmental or market shocks and promoting income diversification during off seasons. LWR has helped coffee farmers get quality coffee seeds, fertilizer and other materials to grow high-quality coffee. LWR also helps cooperatives to provide more support and training to their farmers and access buyers willing to pay better prices. Through this work, many farmers around the world have been able to build stronger livelihoods with their coffee. Even still, market challenges remain.
For now, LWR’s partnership with Thrive is benefitting farmers in the small town of Jinotega, Nicaragua — through Lutheran World Relief Farmers Market Coffee, farmers are guaranteed to earn above Fair-Trade minimums for their first payment and are additionally rewarded with a share of year-end profits, which further increases their incomes. Additionally, for every pound of coffee purchased, THRIVE Farmers donates 80¢ back to LWR to continue targeted empowerment programs that enable farmers to achieve economic stability.
Lutheran World Relief Farmers Market Coffee has only been available since August. While we are already seeing lives transformed by this program, we are excited to see it grow and continue to empower farmers around the world.
The Thrive/Lutheran World Relief partnership is an excellent example of a market-based solution for farmers who need economic impact — helping to change the lives of coffee farmers and the industry as we know it all over the world.
By thoughtfully choosing where to buy coffee, businesses and companies alike can directly participate in the transformation of an industry.