The Memorandum of Understanding (MOU) signed by Melissa Duncan, Fairtrade’s executive director and Dr. Éliane Ubalijoro, CIFOR-ICRAF’s CEO, solidifies their commitment to advance nature-based solutions into key supply chains such as coffee and cocoa. This will later be expanded to other product areas such as tea, banana, cotton, sugar, and nuts.

This five-year partnership will also foster future mutual endeavours on advocacy and policy influencing, and collaboration on exchanging and co-developing knowledge and expertise on priority thematic areas such as climate and the environment, deforestation, and decent livelihoods.

They will work side-by-side to support countries and supply chain stakeholders, particularly smallholder farmers, in implementing new legislation, which includes the EU Deforestation Regulation and the Corporate Sustainability Due Diligence Directive. In addition, they will also assist stakeholders in building up their climate resilience and transition to agroecology.

“Fairtrade found in the alliance with CIFOR-ICRAF great synergies as well as a shared commitment to facing the challenges of climate change and the biodiversity crisis,” said Duncan. “With this partnership we aim to accelerate agroecology transitions, scaling agroforestry systems, and building further climate resilience among Fairtrade producers and workers.”

“This memorandum of understanding represents a significant step forward in our shared commitment to advancing sustainable and equitable livelihoods for smallholder farmers and forest communities,” said Ubalijoro. “By aligning CIFOR-ICRAF’s scientific expertise with Fairtrade’s market-driven approach, we can create meaningful pathways to empower producers, enhance climate resilience, and support biodiversity conservation. Together, we are fostering a future where environmental sustainability and social equity go hand in hand.”

This year’s World Soil Day theme of “Caring for soils: Measure, monitor, manage” is perfectly aligned with the aim of this new strategic partnership to safeguard people and the planet. Indeed, for farmers, healthier and more fertile soils can result in higher incomes through more productivity, less reliance on external inputs, higher crop quality, and increased resilience to climate change. For the planet, enhanced soil health can increase carbon sequestration in soils as well as allowing lower emissions per product thanks to higher yields, both supporting climate change mitigation.

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For many years Brazil’s annual harvests, particularly of Arabica beans, have had a significant influence on international coffee prices. Brazil’s sometimes rocky economic situation does have an effect on coffee bean harvests – and the results show up in overall production for various bean types, in organic production trends, and in the country’s total export volumes.

The 2023-2024 coffee harvest season in Brazil was marked by a significant increase in production compared with the previous year. This surge was primarily driven by favourable weather conditions and improved farming practices. Brazil’s total coffee production in 2024 exceeded that of 2023 by a substantial margin.

Brazil is renowned for its high-quality Arabica beans, which are prized for both their flavour profile and their aroma. However, the country also produces Robusta beans, a lowercost alternative, whose reputation has been improving over the last few years. The relative proportions of Arabica and Robusta in Brazil’s harvests do fluctuate from year to year, influenced by factors such as market demand and economic incentives.

In general, Arabica beans continue to dominate Brazil’s coffee production, accounting for asignificantly larger share of the total harvest. However, Robusta production has also shown growth in recent years, driven by increasing demand for lower-priced coffee options.

Organic coffee production has been gaining traction in Brazil, as consumers increasingly seek products that are grown without the use of synthetic pesticides and fertilisers. While organic coffee still represents a relatively small portion of Brazil’s total coffee output, it has experienced steady growth in recent years.

Several factors have contributed to the expansion of organic coffee production in Brazil. These include increased consumer awareness of the benefits of organic products, government support for organic agriculture, and the development of sustainable farming practices.
Brazil’s coffee products reach markets around the world. The volume of coffee exports from Brazil varies depending on the changing dynamics of global demand, competition from other producing countries, and worldwide economic conditions.

Brazil’s coffee bean harvests play a vital role in the global coffee market. The country’s production of high-quality Arabica beans, coupled with its increasing focus on organic coffee, has solidified its position as a leading exporter. Brazil has maintained its strong position due to strong demand for its beans from countries such as the United States, Europe and Japan. However, the country has also faced competition from other coffee-producing nations, particularly Vietnam and Colombia.

Several factors are influencing Brazil’s coffee production, including these four:
Weather: Climate conditions, such as rainfall and temperature, can significantly impact coffee yields. Excessive rainfall or droughts can negatively affect crop health and productivity.
Pests and diseases: Coffee plants, particularly, Arabica, are susceptible to various pests and diseases, which can reduce yields and quality. Effective pest control measures are essential for maintaining healthy crops.
Soil quality: The quality of the soil in coffee-growing regions is crucial for plant health and productivity. Poor soil conditions can limit crop yields and affect bean quality.
Economic factors: Economic factors, such as the price of coffee beans and the cost of production, can influence the profitability of coffee farming. Low coffee prices or rising production costs can discourage farmers from investing in coffee cultivation.

While weather, pests, soil quality, and economic conditions can influence coffee production, Brazil’s ability to adapt to changing market dynamics and invest in sustainable farming practices positions it well for continued success in the years to come.

The Impact of Climate Change
Coffee production is fragile, and the Intergovernmental Panel on Climate Change (IPCC) reports maintain that climate change will reduce worldwide yields on average and decrease land suitable for growing coffee by 2050.

Climate change is affecting Brazil’s coffee industry in ways which may, in the end, become detrimental to everyone – from the growers all the way downstream to those who consume their coffee.

“A Systematic Review on the Impacts of Climate Change on Coffee Agrosystems” is the January 2023 research article published in the prestigious PLANTS science journal. The six co-authors of this study reviewed 148 records from literature considering the effects of climate change and climate variability on coffee production, covering countries mostly from three continents (America, Africa, and Asia).

The main effects of climate change have been hotter temperatures and lower moisture, causing plants and cherries to not only be unable to fully flourish and bloom, but die while developing. Since the majority of Brazil’s coffee plantations are below 6,000 feet, they are being impacted in tangible ways by hotter temperatures.

Coffee plants need very specific temperatures, soil, and environments to grow in and continually produce coffee each year. With the rising temperature and lack of rainfall and humidity, coffee plants aren’t growing and reproducing as they usually would. Climate change has caused typical weather patterns to be inconsistent, making harvest times and crop quality nearly impossible to control and predict. Though rainfall is lacking for some growing regions, it’s happening more often for others, resulting in more harvesting and picking cycles, which is great.
However, this means higher labour costs than usual, making it harder on farmers.

The hotter temperatures have caused plants to lose several growing days in their usual harvest cycle. This is because heat can disturb a plant’s metabolism, driving stress in the plant and possibly reducing its photosynthetic efficiency. While hotter regions have caused harm to some growing regions, it has opened up new areas where coffee can be grown. With the increased temperatures, coffee can now grow at higher altitudes. Twenty years ago, coffee couldn’t grow in altitudes above 6,000 feet, but now, some of the best coffees are coming from these regions. However, the majority of coffee plantations are below 6,000 feet and are being impacted by the hotter temperatures. The main effects of climate change have been hotter temperatures and lower moisture, preventing plants and cherries from fully flourishing and blooming, but also dying while developing.

Climate change is a reason for the rapid spread of coffee leaf rust, a parasite that feeds off the leaves of the Arabica plant, and steals their food, causing the leaves to spot until they fall off and the plant dies. In the 1800s, this disease killed off most of the world’s coffee supply, and in 2012, another horrific outbreak resulted in over three billion dollars in damages. Coffee leaf rust can be controlled and contained by applying fungicides during wet seasons. However, it is only at higher altitudes and cooler temperatures that the disease struggles to reproduce and spread. This is still a very real problem that farmers face.

The Brazilian National Supply Company (CONAB) is a national government agency that manages agricultural policies and supply and provides information on Brazil’s agricultural harvest. In September of 2024, Conab lowered its forecast for 2024 Brazil’s coffee production: 54.79 million bags from 58.81 million as it forecast in May, due to the dry weather and extreme heat the crop experienced during its development phase.

This would put production down 0.5 percent from last year. Arabica production was lowered to 39.59 million bags from the previous forecast of 42.11 million. Conab’s forecast is up 1.7 percent from 2023 due to increased planted area. Yields were lowered, despite this being an ‘on year’ in the country’s biennial cycle.

Robusta production was forecast previously at 15.2 million bags, down from 16.71 million which had been the estimate in May and down six percent from a year ago. Brazil’s weather
conditions are not expected, but there could be a gradual increase in the number and frequency of showers as humidity starts to build for the rainy season. Greater rainfall is possible in the last days of September or early October. Until then, most
of the rain will remain too light to induce any flowering. ICE Arabica stocks are down to 837,656 bags, their lowest level since 4 September. The amount pending review is down to 6,081 bags, which is the lowest in more than six months.

UN FAO economist Fabio Palmeri shared his views about Brazil’s challenges and opportunities, “After negatively affecting the 2024 coffee output, prolonged dry weather conditions are raising concerns over the potential impact on the 2025 crop. In the first nine months of 2024, Brazil exported two million tonnes of coffee, 40 percent more than in the corresponding period last year, with export earnings reaching a record high of USD $8.5 billion, amid strong international demand. Arabica coffee remained the most exported variety. However, exports of Robusta and Conilon coffee surged in 2024, with shipments increasing by 170 percent compared to 2023, amid lower availabilities from Vietnam.”

Palmeri made a special note of the fact that coffee exports increased despite persistent logistics bottlenecks, including limited space at Brazilian ports coupled with greater demand for shipping containers.

Well Positioned for Continued Growth

In tabulating Brazil’s national coffee consumption data for the period from November 2022 to October 2023, the Brazilian Association of the Coffee Industry (ABIC) found that there had been an increase of 1.64 percent as compared to November 2021 to October 2022. This volume represents 39.4 percent of the 2023 harvest, which was 55.07 million bags, according to Conab. In the period from November 2021 to October 2022, the volume consumed inside Brazil represented 41.9 percent of the harvest, which was 50.9 million bags.

As the world shifts to low-carbon economic sectors and markets, Brazil’s rich ecosystems can enable it to discover some lasting growth opportunities created by that shift. Threequarters of Brazil’s greenhouse gas emissions result from land-use change and agriculture. This implies that Brazil can and should make it a greater priority to halt spreading deforestation while transitioning towards low-carbon agriculture.

The scientific consensus is clear: Brazil’s rainforest in the Amazon is close to a tipping point, beyond which it cannot generate enough rainfall to sustain the national ecosystem. This is the power that fuelled Brazil’s growth: the agriculture, hydropower, water supply, industries. That same endangered ecosystem provides a full spectrum of environmental services to all of Latin America and the Caribbean as well as to the rest of the world.

Halting deforestation and scaling-up climatesmart land use can be done within Brazil’s agriculture sector while simultaneously increasing total productivity. It is entirely possible for Brazil to fully integrate agriculture, and other businesses, into the future green economy.

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PACK EXPO International organiser, PMMI (The Association for Packaging and Processing Technologies) announced that the show featured 2,700 exhibitors providing solutions in more than 40 vertical markets and welcomed 48,000 attendees. 

Amid continuing global economic pressures, PMMI reported that the packaging machinery industry has shown resilience and adaptability. According to its newly released State of the Industry: US Packaging Machinery report, which Jorge Izquierdo, vice president, market develop at PMMI, discussed at the Media Briefing during the show, the US packaging machinery market is projected to reach USD $11.1 billion in 2024, driven by automation and sustainability. Industry growth is expected to peak in 2027, with a continued focus on innovative solutions to meet evolving consumer and regulatory demands. 

According to the report, growth for the first half of 2024 was bolstered by the “clearing of remaining backlogs from the pandemic, the continued adoption of automated solutions, and the increasing demand for new machines to accommodate new packaging styles.” However, as the year continued, backlogs largely dried up as new orders slowed. The softened demand resulted in lower growth for the year overall, with a growth of 5.8%, reaching a value of USD $10.9 billion of new machines shipped, per the report. 

The lighter demand for new machinery continued into 2024. The report reveals that the packaging machinery sector is expected to experience its slowest growth year compared to the last three years in the industry. PMMI noted that the Federal Reserve’s decision to hold interest rates high and the uncertainty surrounding the US election contributed to the slowdown. 

PMMI expects sales of new machinery to begin rising again in the second half of 2024 “as the wait-and-see mentality dissipates.” Furthermore, PMMI believes that there will likely be more requests for end-of-line automation as many companies continue to struggle with retaining labour for production lines. Growth is expected to peak again in 2027, “in line with the three-year peak-to-trough cycle that we have come to expect in this market.” 

The report finds that the beverage industry proved resilient with a steady demand for drinks of all kinds. Recent trends include diversification of drink sizes — as evidenced by the displays at many exhibitor’s booths at the show, such as Tetra Pak, whose ready-to-drink packaging sizes ranged from 200ml to 1000ml.

Sustainability is one of the most significant topics in the packaging industry today. And while the US has less stringent regulations compared to the EU, major players are increasingly shifting towards more sustainable packaging solutions. The PMMI report reveals that many companies are moving away from single-use plastics (SUPs) in favour of paperboard and other eco-friendly materials. This trend is driven by both regulatory pressure and of course, consumer demand for greener alternatives. 

In addition to Tetra Pak’s aseptic paperboard, aluminum, and polyethylene packaging, Graphic Packaging was showcasing its Boardio packaging. Boardio is a fiber-based canister that can be tailored from low to high barrier protection, making it suitable for different applications. Folgers debuted its 1850 coffee brand in Boardio packaging in Walmart and Costco stores earlier this year, and both Walmart and Target rolled out their store-branded coffees in Boardio packaging in September and October. 

A significant trend to watch is the shift in packaging materials, with glass and cans gaining popularity as the industry seeks more alternatives to plastic. However, aluminum is also growing in popularity given that it is infinitely recyclable. GEA Processing was showcasing its new Uni Bloc Flex aseptic filling machine, which is a bottle sterilizer, rinser, filler and capper all in one as there has been a movement toward consolidation of machines within the filling and packaging sector. 

Tucker Scofield, packaging sales manager, liquids and powders, noted that GEA’s machine is the only one on the market doing aseptic aluminum. “It’s not a new technology –it’s been around for 25 years – but it’s new for aluminum bottles,” he said. “Aseptic is really becoming popular now because technology is making it easier to do.” Scofield added that there has been a lot of interest from coffee, tea and water brands. The Uni Bloc Flex can also fill glass and PET bottles. 

 New packaging regulations coming to the US was also a major topic of discussion, but I’ll save that for a future blog. 

• Vanessa L Facenda, editor, Tea & Coffee Trade Journal.
  Keep in touch via email: vanessa@bellpublishing.com Twitter: @TCTradeJournal or LinkedIn: Tea & Coffee Trade Journal

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Key Highlights and Award Winners

Taiwan was the standout region of 2024, winning the highest number of awards overall with eight Gold and 10 Highly Commended winning teas. Taiwanese teas proved their excellence in various categories, with LuYu Tea Garden taking home the highly coveted Best in Black award for their exceptional black tea, which wowed judges with its depth and balanced flavour.

Japan once again took centre stage with Yame Tea Kumaen earning the prestigious Best in Show title for the second year. Their matcha saemidori astonished the judges with its sweet and creamy flavour and long-lasting smoothness. Japanese teas earned 16 Awards in total, including six Gold and 10 Highly Commended. Notably, Teaste it, an Italian-Japanese tea company, impressed the judges with their innovative Moka-cha, a matcha prepared in a traditional coffee moka pot.

Islington-based Japanese tea retailer Katsute claimed the most awards for any single retailer, receiving accolades for their premium matcha, gyokuro, and genmaicha teas. In India, Jay Shree Tea won the most awards of any single company. They were recognised with two Gold awards, including one for their experimental Steamed and Panned Darjeeling, along with three Highly Commended teas. Sri Lanka also earned seven awards overall, with high quality Ceylon teas demonstrating the region’s continued excellence in the global tea market.

China contributed some standout teas including Sichuan Emei-shan Zhuyeqing Tea’s scented jasmine, which was recognized not only for its superb quality but also for its artistry in tea making. Sichuan Emei-shan Zhuyeqing Tea was also honoured with The Leafies Pioneer Special Award for their impressive contributions to the industry. The Nepali tea community was also recognized this year, with Sandakphu and Nepal Tea Collective both winning Gold awards for their exceptional teas, highlighting Nepal’s growing prominence in the global tea industry.

New Categories and Innovative Teas

For the first time, The Leafies introduced a “Fruit and Herbal Infusions” category, which saw two extraordinary entries from Quinta de Soalheiro of Portugal. Their Lemon Verbena and Chocolate Mint infusions received glowing praise from the judging panel.

This year also marked significant recognition for retailers, with products like Birchall’s Great Rift Breakfast Blend and Copenhagen Sparkling Tea’s Jasmine, Darjeeling, Chamomile tea winning awards.

Commitment to Sustainability and Social Impact

An ongoing commitment from The Leafies to celebrate trail blazing tea companies in areas such as environmental stewardship, community empowerment, innovation and education is represented through a selection of special awards,with winners including the women-owned cooperative Kazi Yetuin Tanzania and Kaley Tea in Sri Lanka for its impressive sustainability initiatives.

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The Science Based Targets initiative (SBTi) has approved Finlays’ near and long-term science-based emissions reductions targets, including its net-zero science-based target by 2040. This ensures Finlays’ emission reduction targets are in line with limiting global warming to 1.5°, helping prevent the worst impacts of climate change.

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Why This Matters, and Why Now
The contemporary agri-food sector faces a profound challenge that threatens the socio-economic stability of smallholder farmers worldwide: the pervasive inability to secure a living income. This issue stems from multiple factors, including limited arable land, suboptimal agricultural productivity, and inequitable value distribution within supply chains. As global commodity prices fluctuate, smallholder farmers remain vulnerable, often unable to influence market trends or earn a fair share for their products.

Amid these challenges, the European Union’s Corporate Sustainability Due Diligence Directive (CSDDD) marks a critical juncture for international supply chains, mandating higher social responsibility standards for commodity buyers. This regulation offers a unique opportunity to create a level playing field, benefiting all producing countries equally. The white paper’s release is timely, aiming to harness this regulatory shift to drive significant, data-informed changes across global supply chains.

Introducing the White Paper
The Commodity Living Income Strategy is a data-first intervention aimed at achieving living incomes in commodity supply chains. It is founded on principles of fair value distribution and data-driven decision-making, advocating for a two-pronged intervention approach: first, assisting producers, organized producer groups, and their supply chain partners in understanding their cost-efficiencies and living income price gaps; second, it leverages this data to design holistic intervention strategies tailored to local sustainability, production, and quality needs.

This white paper introduces two key methodologies:
1. Living Income Price (LIP): The LIP calculates the price per unit of a commodity based on its actual production costs across various supply chain stages (farmgate, producer organizations or “cooperatives”, and Free on Board. This approach helps establish a minimum viable price floor, ensuring that producers are compensated fairly for their sustainable and efficient production efforts.
2. Cost-Yield Efficiency (CYE): This CYE categorizes producers’ efficiency by considering both their costs and yields. It provides a nuanced understanding of efficiency levels among farmers, identifying areas for improvement and forming the basis for tailored intervention strategies.

The strategy presented within this white paper encapsulates both methodologies, providing a structured approach to understand both productivity and efficiency aspects of pricing, and identify the necessary interventions to bridge living income gaps. It addresses the critical question: Where is this supply chain currently, and how far do we need to go to achieve sustainability? Moreover, it promotes data-driven, defensible decision-making involving both efficiency and pricing interventions, strategically co-created with supply chain stakeholders, and, most crucially, with farmers themselves.

“By leveraging real, verifiable data, and investing in both efficiency and pricing interventions, we can set a new standard for transparency and accountability in global supply chains,” said Antoinette Marie, director of Heifer Labs, a digital technology unit within Heifer International.

Commitment to Transparency and Open-Source
By making the parameters and tools publicly accessible and open-source, Heifer and Fairfood aim to inspire industry-wide change. This transparency is designed to foster a community of informed stakeholders, enhancing dialogue and collaboration across the supply chain. The Open-Source Toolkit previewed in the White Paper will provide practical resources for implementing LIP and CYE methodologies, driving sustainable practices, and ensuring that all stakeholders can contribute to and benefit from these innovations. “This is not just about compliance or corporate responsibility,” said Sander de Jong, managing director of Fairfood International. “It’s about recognizing the human side of supply chains and committing to a future where every farmer can live with dignity.”

Download the white paper here.

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This is where Lavazza steps in, celebrating the essence of human experience. The brand achieves this goal with a light-hearted, cheerful, and moving story that hits all the right notes. The hero of the film is Luigi, a sentient little robot that serves freshly brewed coffee. Every day, Luigi witnesses the reactions of pure pleasure his human colleagues have when drinking their Lavazza coffees, until he develops the secret dream of tasting it too. Will a robot be successful in his attempt to feel what humans feel?

The two actors bring all their humour and charm to the story, interacting and having fun with Luigi in multiple episodes and other contents that will be spread across different media channels and countries. The campaign entails a multi-asset release led by a 90” introductory long format film, followed by new episodes and a plethora of different cuts landing on TV and social platforms.

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Since its inception, the Università del Caffè has trained over 350,000 individuals, including coffee producers, baristas, restaurateurs, and coffee lovers. The institution’s mission is to enhance and elevate every aspect of the coffee supply chain, from cultivation to the final cup. This commitment is reflected in its robust educational programs, delivered by a faculty of 50 highly qualified instructors certified by ACS Italia, a skills certification body that attests the level of knowledge and ability in training.

“Training is a strategic lever for the success of a company, an industry, and for the development of individuals,” said Cristina Scocchia, CEO of illycaffè. “It also embodies passion, curiosity, and a desire to expand one’s knowledge. The Università del Caffè exemplifies how a culture of quality and sustainability can be conveyed through innovative and engaging education.”

With branches across different continents, the Università del Caffè offers a diverse range of courses tailored to meet local needs while maintaining a global standard of excellence. This international presence ensures that specialized knowledge is accessible to a wide audience, allowing for a nuanced understanding of regional coffee cultures and practices.

The courses are structured to cater to various stakeholders in the coffee supply chain:

• For coffee producers: The Università del Caffè provides in-depth training on the latest agronomic techniques, tailored to the specific conditions of diverse growing regions. This helps farmers optimize their production and maintain high-quality standards.
• For hospitality professionals: Baristas, restaurateurs, and other hospitality workers receive specialized training on coffee preparation, as well as insights into effective business management and marketing strategies to enhance their operations.
• For coffee enthusiasts: The Università del Caffè offers tasting sessions and informational courses designed to deepen the appreciation of coffee. Participants learn to recognize the unique flavors and aromas of coffees from around the world, fostering a greater understanding of coffee as an art and a science.

As the Università del Caffè celebrates this milestone, it remains committed to its mission of spreading the culture of quality coffee and ensuring that everyone in the coffee community, from producer to consumer, can benefit from its wealth of knowledge and expertise.

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Global ingredient supplier Prinova surveyed over 1500 adult consumers in France, Germany, Italy, Spain, the UK and the US (conducted online in June 2024) and found that 72% percent said they were more likely to buy a food or beverage product if the packaging mentioned a health benefit. This number rose to 87% among those aged 18 to 24, and to 80% among those aged 25 to 34.

Overall, the claims most likely to influence purchasing decisions were low-sugar or sugar-free, weight management and energy support. The ingredients most likely to influence purchasing decisions were probiotics, vitamins, minerals, and fibre, while the concerns most likely to affect food and beverage purchases were gut health, healthy aging and fatigue.

Commenting on the findings, James Street, global marketing director at Prinova, said, “There’s a long-term trend towards more proactive approaches to wellbeing, with dietary changes a key element of consumers’ strategies for living better. As a result, they’re increasingly seeking out food and beverage products with health benefits. Our research demonstrates the value of well communicated health claims, especially in key areas like gut health and energy support. While they resonate powerfully across all demographics, our research provides new evidence that ‘zoomers’ [Gen Z] and millennials are particularly likely to focus on wellness when choosing between products.”

The research also reveals high levels of interest in personalised approaches to nutrition. For example, 79% of respondents believed that their particular genetic make-up affected their nutritional needs either slightly or significantly, with millennials and women particularly likely to agree. Furthermore, 41% were keen to try a test that monitored how particular foods affected their bodies, while 32% were interested in tracking their diet and nutrition through an app or questionnaire. Thirty percent of respondents overall, and 37% of those aged 25-34, were interested in wearable devices to monitor their blood sugar levels.

One unusual finding relates to ‘gamers’ — 66% of the consumers surveyed played video games at least once a week, and 61% of these said they used food or nutrition products to improve their gaming performance. The ingredients most associated with superior performance were caffeine, B vitamins and ginseng.

While this survey was conducted by an ingredients supplier (Prinova offers ingredients such as amino acids, plant proteins, sweeteners and vitamins), the findings further support the continuing trend of consumers actively making healthier F&B purchases. The post-Covid surge in the popularity of functional beverages has not abated, rather, it has sparked consumer spend and interest in such products, spurring the term (and trend), ‘the wellness economy.’ For example, matcha (as well as green tea) beverages in all varieties remain popular with consumption rising. Matcha has a high level of nutrients including antioxidants, L-theanine, and catechins. (T&CTJ’s newest matcha feature will appear in our October 2024 issue.) Functional coffees (high energy, improved focus, memory, gut and/or digestive health, etc., see https://www.teaandcoffee.net/feature/31946/functional-coffees-popularity-is-surging-but-the-true-benefits-remain-questionable/) also continue to surge in popularity and sales.

And as this healthy movement has grown, it has, by extension, expanded and brought forth wellness teas catered towards women and their specific health needs such as the different stages of women’s reproductive life, from menstruation, pregnancy, nursing, and menopause. (See Gendered teas: a marketing strategy or women’s reprieve? – Tea & Coffee Trade Journal (teaandcoffee.net) and/or Women’s wellness teas: a new category or marketing ploy? – Tea & Coffee Trade Journal (teaandcoffee.net)).

According to the research, post-pandemic, global consumers are being more proactive and taking a holistic approach to their wellbeing (per FMCG Gurus, Top Ten Trends for 2023). “With dietary changes a key part of their strategy for living both longer and better, they are increasingly seeking out products with health claims and advice to target their specific concerns.”

To download the full report, click here.

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Why Private Label Tea?
Those who decide to develop private label tea often do so for several reasons. Private label tea can help build new customers. A coffee shop, for example, might see two friends come in together, one ordering a cup of coffee and the other ordering tea. If that tea is not under the coffee shop’s label, the tea-drinking customer did not experience a full encounter with the shop’s brand, but instead got a product they may be able to get from any number of other providers. One of the two friends (the coffee drinker) interacted
with the brand, creating a richer opportunity to build brand loyalty. The other friend did not.
Private label tea also offers convenience to existing and loyal customers. Consider how a bakery or pastry shop might add a line of private label teas to their offerings, knowing that teas and desserts are often enjoyed together. Building on this theme, their private label tea selection could include teas specifically created to pair with their desserts. Now the customer has one less stop on the shopping trip to find food and beverage that deliciously complement each other.

Format
For private label tea, format more often refers to whether the tea is loose leaf, teabag, or ready-to-drink (RTD). There are other formats, like stick packs for instant tea powders, or options for foodservice, but loose leaf, teabag and RTD are the most common. Choice of format should match the preferences of the end customer. Does the customer want a quick and easy cup of tea with less messy clean up? If so, a teabag would be a good fit. Is the customer a more experienced tea connoisseur who wants more control over the amount of leaf used and individual style of preparation? In that case, a loose leaf format
would do well. Is the customer concerned about sustainability and reducing packaging? Does the
customer base have particular lifestyle activities (athletics, gaming, etc) that align with a bottle
tea format? These are all examples of how private label tea format needs to fit with the brand and
the needs of the end user.

Flavour
The reason mainstream tea retailers offer Earl Grey tea is because mainstream tea customers
recognise and buy Earl Grey tea. When choosing tea flavours for a private label line of teas, it is
important to anticipate what flavours will be the bread-and-butter teas that will do more of the
heavy lifting in sales volume. Since there is no universally standardised recipe for teas like Earl
Grey, a private label customer is free to offer their “take” on this and other classic teas. For example,
the black tea that serves as the base of Earl Grey can come from China, India, or any other
origin (or combination thereof). Since bergamot flavouring can slightly vary in flavour and
aroma, even classic teas can differ in profile from one brand to the next. Functional ingredients
may also be added to a blended or flavoured tea in order to highlight certain health benefits. Private
label tea offers each brand the opportunity to create their own unique version of their teas.
Additionally, a private label tea line allows for the creation of seasonal tea options (another
pumpkin spice anyone?) and the development of signature teas that cannot be found elsewhere.
These unique offerings provide interest and variety that attract tea drinkers to check back to try new teas along with their steady repeat purchases.
An important point worth noting in creating tea flavours and blends is the choice of ingredients. Be wary of choosing ingredients that are seasonal or otherwise more difficult to procure. Not only do these ingredients increase the cost of the blend, but they can also create problems in managing consistent supply over longer periods of time. Your private label partner can provide guidance in this area.

Packaging
Packaging creates the first impression of your tea product, so a well-designed package that resonates
with your customers is an important component. The process of designing product packaging can
be time consuming but is usually worth it to make an attractive statement. Aside from package aesthetics, functional considerations should also be reviewed. Printed zip-top pouches are economical, lightweight, and help keep the tea fresher after opening. However, a box or tin may be easier to stack neatly on a retail display shelf. Tins are durable, can be reused, and provide sturdy protection for the leaf inside. But tins can be easily dented, scuffed, or damaged during shipping to a customer’s home (à la online retail) unless they are sufficiently protected.

Choosing a Private Label Partner
The first step in creating your private label tea is finding a suitable partner. Among other things, partner(s) will be responsible for: sourcing ingredients and packaging materials, blending, packing, regulatory compliance, and preparing your products for shipping from their facilities.
The process of vetting potential partners will likely reveal their relative strengths. Not all partners are set up with the machinery to run all product formats. They may have certain advantages in procuring ingredients from particular origins. Additional considerations include minimum production volumes and
production scheduling/turnaround. Any reputable private label provider should also be able to provide guidance on necessary certifications and compliance, including standard practices for things like ingredient listing on packaging, nutrition labelling, best by dates, certifications (including kosher, organic, and the like), COAs (certificates of analysis), and information on their food safety practices.
Other aspects may fall outside the scope of your partner, and they may ask the client to be more involved in product design and procuring packaging. Package design can be a time consuming process, involving packaging producers, designers, and the manufacturer. Specialty packaging, or packaging that your partner may not regularly purchase, may also be the responsibility of the client to arrange. The
private label partner may have some suggested designers or package providers to work with. If
your private label teas will include health claims, legal services can help determine what product
statements are permissible according to legal guidelines. Creating a successful private label line of teas
requires time, thoughtful consideration, and the help of a capable private label partner. In the areas
of flavour, format, and packaging, trade offs will be necessary to find the optimal intersection of
aesthetic, function, and value. When done well, private label tea attracts new and repeat customers
while enhancing a business’s brand.

• Jason Walker is marketing director of Firsd Tea North America. Prior to his work with Firsd Tea, Walker served in a variety of roles in tea and beverage business capacities. His experience includes business services for small tea companies, a top-ranked online destination for tea consumer education and co-founding a coffee business. His insights draw upon his diverse range of experience in sales, operations and management in the tea world. He may be reached at: jason.walker@firsdtea.com

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Mark Schneider, CEO, has decided to relinquish his roles as CEO and member of the Board of Directors. Over his eight years with the company, he has actively shaped the company’s portfolio, in line with Nestlé’s strategy and with a focus on high-growth categories like coffee, pet care and nutritional health products.

Laurent Freixe joined Nestlé in France in 1986. Since then, he has continuously progressed within the company, assuming various positions of increasing responsibility across different businesses, markets and Zones. He successfully managed Zone Europe during the financial and economic crisis, from 2008 until 2014. He then took over as CEO of Zone Americas, where he accelerated growth. Following the creation of Nestlé’s new Zone structure in 2022, Laurent Freixe was named CEO Zone Latin America, where he has been successfully leading through challenging conditions.

Laurent Freixe has been a member of the Executive Board for 16 years and, as such, has played an important role in strengthening the strategic direction of the company and its portfolio. With his profound understanding of Nestlé’s culture and values, he has led several global corporate initiatives to improve productivity, increase operational efficiency, simplify processes and drive innovation. Additionally, Laurent Freixe is committed to developing future leaders and talents, as evidenced by his active role in the Nestlé Leadership and Training Programs as well as the Nestlé Needs YOUth initiative, which promotes youth employment.

“The Board of Directors is delighted to announce the appointment of Laurent as the new CEO. I have known Laurent for a long time and highly regard him as a talented leader with strategic acumen, extensive in-market experience and expertise as well as a deep understanding of markets and consumers. He has demonstrated his ability to deliver results in challenging market conditions,” said Paul Bulcke, chairman of the board. “Laurent’s curiosity fuels his passion for innovation and positive change. Laurent is the perfect fit for Nestlé at this time. Under his leadership, Nestlé will further strengthen its position as a dependable, reliable company through consistent and sustainable value creation.”

Bulcke added, “I would also like to express our gratitude to Mark for his significant contributions to Nestlé and for his outstanding, steady leadership in turbulent times. Mark has been instrumental in the great progress we have made on our sustainability agenda. We extend our best wishes to him in all his professional and personal endeavours.”

Commenting on his appointment, Laurent Freixe said, “I am privileged to have been given the opportunity to continue building and strengthening Nestlé, and I am excited to take on this responsibility. There will always be challenges, but we have unparalleled strengths, such as iconic brands and products, an unmatched global presence, leading innovation and execution capabilities, and above all, exceptional people and teams. We can strategically position Nestlé to lead and win everywhere we operate.”

Mark Schneider commented on his tenure, noting, “Leading Nestlé for the past 8 years has been an honour for me. I am grateful for what we have achieved, having transformed Nestlé into a future-proofed, innovative and sustainable business. I would like to thank the entire Nestlé community for what we have accomplished together and wish Laurent all the best in his new role.”

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Niccol replaces Laxman Narasimhan who is stepping down as CEO and as a director effective immediately. Narasimhan assumed the position of CEO of Starbucks in March 2023, succeeding founder and former CEO and chairman emeritus, Howard Schultz. During his tenure, the company noted that he improved the Starbucks partner experience, drove significant innovation in its supply chain, and enhanced store operations. However, the company has faced significant challenges this year, including declining sales in key markets such as the US and China. Furthermore, the Wall Street Journal reported that Seattle, Washington-based Starbucks is under increasing pressure from activist investors as it also grapples with a sagging share price.

Following the announcement of Niccol as the incoming CEO, shares of Starbucks Corporation (SBUX) jumped 12.8% in premarket action — its highest level since late April, per Seeking Alpha.

Niccol currently serves as chairman and CEO of Chipotle. Since becoming CEO in 2018, Niccol has transformed Chipotle. His focus on people and culture, brand, menu innovation, operational excellence, and digital transformation have set new standards in the industry and driven significant growth and value creation. Revenue has nearly doubled, profits have increased nearly sevenfold, and the stock price has increased by nearly 800% during his leadership, all while increasing wages for retail team members, expanding benefits, and strengthening the culture.

“We are thrilled to welcome Brian to Starbucks. His phenomenal career speaks for itself. Brian is a culture carrier who brings a wealth of experience and a proven track record of driving innovation and growth. Like all of us at Starbucks, he understands that a remarkable customer experience is rooted in an exceptional partner experience,” said Hobson. “Our board believes he will be a transformative leader for our company, our people, and everyone we serve around the world.”

“I am excited to join Starbucks and grateful for the opportunity to help steward this incredible company, alongside hundreds of thousands of devoted partners,” said Niccol. “I have long-admired Starbucks iconic brand, unique culture and commitment to enhancing human connections around the globe. As I embark upon this journey, I am energized by the tremendous potential to drive growth and further enhance the Starbucks experience for our customers and partners, while staying true to our mission and values.”

Niccol joined Chipotle as CEO and a director in March 2018, and became chairman of the board in March 2020. Before joining Chipotle, he served as CEO of Taco Bell. Before becoming CEO there, he held roles including chief marketing and innovation officer, and president. He also served in leadership roles at Pizza Hut, another division of Yum! Brands. He began his career in brand management at Procter & Gamble.

Niccol currently serves on the board of directors of Walmart Inc. He previously served on the board of KB Home and Harley-Davidson. Niccol holds an undergraduate degree from Miami University and an MBA from the University of Chicago Booth School of Business.

“Having followed Brian’s leadership and transformation journey at Chipotle, I’ve long admired his leadership impact. His retail excellence and track record in delivering extraordinary shareholder value recognizes the critical human element it takes to lead a culture and values driven enterprise. I believe he is the leader Starbucks needs at a pivotal moment in its history. He has my respect and full support,” said Schultz. “I thank Mellody and the Starbucks board for their deep commitment to shaping the future of this remarkable global phenomenon that is Starbucks.”

Ruggeri is a 23-year Starbucks partner and has been CFO since 2021.

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Historically, CoE, ACE, and SCA have operated independently, occasionally collaborating on smaller projects. This formal partnership, established via the signing of a Memorandum of Understanding (MoU), brings together their unique strengths to create a significant impact on coffee producers, the industry, and consumers. The SCA confirmed that this is not a merger, simply a new strategic partnership.

Erwin Mierisch, executive director of Cup of Excellence and Alliance for Coffee Excellence, emphasised the partnership’s importance: “For too many years our organizations have walked separate paths. This long-awaited partnership is just the beginning of the positive impact that is expected for farmers, producing countries and roasters searching for high quality. From education to quality analysis to outreach and information – sharing huge opportunities abound to drive specialty coffee in the right direction.”

The initial focus will be to understand how the two organizations can integrate the descriptive and scoring portions of the Coffee Value Assessment (CVA) analysis protocol into the Cup of Excellence competition structure. CoE professional head judges and staff, along with the SCA technical team, will jointly assess, refine, and adapt the CVA form to the competition, ensuring fair and impartial judging and sensory analysis of competition and auctioned coffees.

Education and cupper certification will also be pivotal. The partnership aims to enhance the skills and recognition of in-country cuppers, whose expertise is crucial to the foundation of specialty coffees.

Yannis Apostolopoulos, CEO of the Specialty Coffee Association, stated, “This partnership goes beyond improving quality assessment; it aims to enhance the entire coffee ecosystem. By collaborating and sharing expertise, we will set new standards that benefit everyone from producers to consumers, ultimately making coffee better for all.”

The World of Coffee Copenhagen event, where the signing took place, served as an ideal backdrop for this announcement. The synergy between the organizations promises to bring significant positive changes to the industry, showcasing award-winning coffees and the remarkable work of CoE and ACE in discovering and rewarding producers.

Each organization operates with a mission to create positive change within the coffee industry. SCA’s extensive networking and industry outreach, combined with ACE and CoE’s focus on coffee producers and quality, form a powerful alliance poised to drive positive change.

For more information on how this partnership will work and how to get involved in the next stage visit: sca.coffee.

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Net sales for the second quarter of 2023 increased 6.6% to USD $3.79 billion, compared to $3.55 billion in the year-ago period. On a constant currency basis, net sales advanced 6.1%, reflecting net price realisation of 8.2%, only slightly offset by lower volume/mix of 2.1%. The volume/mix performance reflected the continued strength of the Burlington, Massachusetts and Frisco, Texas-based company’s brand portfolio and in-market execution, as well as continued modest elasticities across most categories.

U.S. retail dollar consumption (Retail consumption data based on KDP’s custom IRi category definitions for the 13-week period ending 2 July 2023) of KDP Manufactured K-Cup® Pods decreased 2.3% in IRi tracked channels in the quarter, and KDP Manufactured dollar share was approximately 79%. Total at-home coffee category trends during the second quarter continued to be impacted by greater consumer mobility versus the prior year, though the company observed sequential improvement in category consumption towards the end of the second quarter, which continued into the third quarter. The single serve segment continued to gain volume share of the at-home coffee category throughout the period.

GAAP operating income increased 34.4% to USD $769 million, compared to USD $572 million in the year-ago period, reflecting growth in gross profit, as the strong net sales growth and productivity more than offset continued input cost inflation. Also impacting the comparison was the favourable year-over-year impact of items affecting comparability.

Excluding items affecting comparability, adjusted operating income increased 4.4% to $873 million, including a strong double-digit increase in marketing investment, reflecting the strong growth in net sales and adjusted gross profit, which more than offset transportation, warehousing and labour inflation. On a percent of net sales basis, adjusted operating income was 23.0%.

GAAP net income for the quarter increased 130.7% to $503 million, or $0.36 per diluted share, versus $218 million, or $0.15 per diluted share, in the year-ago period. This performance reflected a favorable year-over-year impact of items affecting comparability and the increase in adjusted operating income, partially offset by a higher GAAP effective tax rate. Excluding items affecting comparability, adjusted net income for the quarter advanced 7.0% to $596 million, and adjusted diluted EPS increased 7.7% to $0.42.

During the quarter, the company repurchased approximately 7 million KDP shares at a weighted average price per share of $32.34, totalling approximately $226 million. The company has approximately $3.2 billion remaining under its share repurchase authorisation expiring on 31 December 2025.

Commenting on the announcement, chairman and CEO Bob Gamgort stated, “Our second quarter results demonstrated the strength of KDP’s brand portfolio and our high-quality retail execution. We saw continued momentum in the U.S. Refreshment Beverages and International segments, as well as encouraging intraquarter developments in U.S. Coffee, where we expect a sequential recovery in revenue and a meaningful inflection in margins in the back half.”

Second Quarter Segment Results
U.S. Coffee net sales for the second quarter decreased 5.7% to $970 million, compared to $1,029 million in the year-ago period, reflecting net price realisation of 1.6% and a volume/mix decline of 7.3%.

At-home coffee consumption in the quarter continued to be impacted by year-over-year changes in mobility, with sequential improvement in category volume trends observable each month of the quarter. Pod revenue declined 4.6%, driven by a shipment decline of 7.7% that primarily reflected mobility-driven category softness, the exit of some lower-margin private label contracts and an unfavourable comparison in the prior year during which the company rebuilt trade inventory levels following supply chain constraints. On a trailing twelve-month basis versus the pre-pandemic Q2 2019 period, at-home pod shipments grew 16.9%, representing a mid-single digit compound annual growth rate (CAGR).

Brewer shipments totalled 9.9 million for the twelve months ending 30 June 2023, representing an 11.0% decline year-over-year. Compared against pre-pandemic levels represented by the twelve months ending 30 June 2019, brewer shipments grew 17.8%, representing a mid-single digit CAGR. Brewer shipments in the second quarter continued to be impacted by trade inventory adjustments, which the company believes are now mostly complete, and slower discretionary spending for small appliances.

GAAP operating income decreased 15.3% to $250 million, compared to $295 million in the year-ago period, reflecting broad-based inflationary pressures, the decline in volume/mix and a significant increase in marketing investment. Partially offsetting these drivers were the benefits of productivity, higher net price realisation and a modest year-over-year benefit of items affecting comparability. Excluding these items, adjusted operating income dropped 14.6% to $292 million and, on a percent of net sales basis, totalled 30.1%.

International net sales for the second quarter increased 10.9% to $489 million versus $441 million in the year-ago period and, on a constant currency basis, net sales advanced 7.0%. This strong performance was driven by higher net price realization of 6.1% and volume/mix growth of 0.9% and reflected broad-based momentum in both Mexico and Canada.

GAAP operating income increased a strong 14.3% to $112 million, compared to $98 million in the year-ago period, largely reflecting the benefits of the higher net sales, increased productivity and the year-over-year benefit of items affecting comparability, partially offset by inflationary pressures and a significant increase in marketing investment. Excluding items affecting comparability, Adjusted operating income increased 7.7% to $116 million and, on a percent of net sales basis, totaled 23.7%.

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T&CTJ, in conjunction once again with Firsd Tea, invites you to add your voice to the 2nd Annual Tea Sustainability Perspectives survey. This survey gauges perceptions of sustainability in the tea industry among business leaders in the tea, coffee and cocoa sectors. It covers social, economic, and environmental issues associated with sustainability.

“The previous survey was a critical mirror for us in the tea industry. This year we want to be aware of any incremental gains or be watchful for any potential regressions. We can then fine-tune our shared actions in a united effort for the betterment of all people, the planet, and the tea plant that is so dear to each of us,” said Jason Walker, marketing director, Firsd Tea North America.

The survey takes about 10 minutes to complete. The deadline has been extended to 31 August 2023.

For every completed response, a contribution will be donated to 1% for the Planet, an international organisation whose members contribute at least one percent of their annual sales to environmental causes. Their mission is to “build, support and activate an alliance of businesses financially committed to creating a healthy planet.”

Access the survey here.

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ICoT is designed to support customers across the cocoa and coffee industries in demonstrating their compliance with regulation being introduced by the EU to minimise the extent to which the consumption of certain commodities in the EU, including cocoa and coffee, result in deforestation worldwide. IBA anticipates launching ICoT in 2024, in advance of the regulation entering into application on 30 December 2024.

“Recognising ICE’s established position in the cocoa and coffee markets, where the benchmark prices for these commodities are formed every day, ICE has been working closely with the industry to design a solution to help customers meet the requirements of the deforestation regulation. This includes the need to receive and verify supply chain data from sellers when entering into transactions,” said Toby Brandon, senior director, ICE Soft Commodity Operations.

“ICE’s customers, stakeholders, and the countries where cocoa and coffee are grown, have made significant investments in supply chain sustainability processes and technology over many years. ICoT builds on this infrastructure by providing a single, standardised platform, allowing the multiple technologies which will be used by customers to provide farmer location and traceability data required by the deforestation regulation. ICoT will independently validate this data to allow cocoa and coffee to be readily traded and placed on the EU market,” continued Brandon.

ICE’s benchmark Cocoa, London Cocoa, Coffee C® and Robusta Coffee futures and options contracts are the largest markets in the world to trade cocoa and coffee. Last year the equivalent of over 500 million tons traded on ICE’s cocoa and coffee markets.

“By collating, standardising and validating supply chain data, ICoT will assist customers in demonstrating compliance from the farm to European consumer product,” said Clive de Ruig, president of IBA. “ICoT is designed to facilitate customers’ successful implementation of the deforestation regulation and maintain the free-flowing and commoditised physical trade of cocoa and coffee, which is crucial for countries where the commodities originate and to businesses in the EU.”

He added that “users of ICoT will benefit from IBA’s proven and market-leading technology and data management, together with IBA’s long-standing experience and reputation for establishing robust and independent governance processes and oversight functions. Combining this expertise with ICE’s established position in commodity markets means that we are well-placed to help customers meet the requirements of the new regulation.”

IBA’s launch of ICoT remains subject to satisfactory testing and feedback, and other dependencies such as system and data availability required under the deforestation regulation.

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A partnership, decades in the making, came together in its ad, which aired during Super Bowl LVII. The ad features Dunkin’s #1 fan, Ben Affleck, donning a Dunkin’ uniform and working the drive-through of a Dunkin’ restaurant in Medford, Massachusetts.

As guests placed their orders, Ben shared one of Dunkin’s latest offers to hit the menu – the Dunkin’ Run – where guests can buy a USD $1 classic donut with any medium or larger coffee. While working his “shift,” Ben even takes a surprise order from his wife, Jennifer Lopez.

Affleck’s long-standing love for Dunkin’ started when he was a kid in Massachusetts. Like so many Dunkin’ diehards, growing up with the brand made him a lifelong fan. So much so that he took a morning shift to share the love and serve real Dunkin’ guests in its latest commercial. That’s the thing about Dunkin’ — the classics bring back childhood memories and feel like home, no matter where or who you are.

While this is a first for Dunkin’ and Ben, it is certainly not the last! Stay tuned for more to come, and check out the spot: Dunkin’ ‘Drive-Thru’ Starring Ben – YouTube

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Firsd Tea recently released a first-of-its-kind Sustainability Perspectives Report in 2022 to capture the tea and coffee industry’s views on how well the tea sector performs in areas of sustainable practices. In conjunction with Tea & Coffee Trade Journal and a third-party research firm, the study was developed with guidance from industry peers and an academic research and think-tank. Respondents of the survey included a diverse spectrum of wholesalers, importers, exporters, retailers, and others based in North America, Europe, and Asia. While many studies have examined consumers’ perceptions of sustainability, this study targeted professionals in tea, coffee, and related industries to understand their concerns and views on the tea industry’s sustainability performance.

The findings of the research can generally be grouped into perspectives about three areas: environment, people, and certifications. Part three of this series focuses on sustainability and certifications.

As a quick recap from the previous coverage, the survey of tea and coffee professionals revealed:

1. Industry professionals show strong concerns about the environmental impact on their businesses — 80 per cent are worried about climate change’s effects on their operations.
2. Respondents are generally split as to the tea industry’s performance in some human welfare areas, like gender equity and poverty reduction.

The survey also revealed some surprising attitudes about sustainability and certifications. Sustainability was not a high-priority consideration for industry respondents in terms of their decisions to carry specific teas in their product offerings. Respondents ranked flavour (96 per cent), leaf grade (90 per cent), origin/terroir (88 per cent) and price (83 per cent) above sustainability (79 per cent). In addition, a significant majority of Industry respondents (85 per cent) view organic certification as the most valued certification standard among consumers. Certifications more closely associated with sustainability fared lower in perceived value, with Fair Trade at 68 per cent, non-GMO at 58 per cent, and Rainforest Alliance/UTZ at 56 per cent. Taken together, these findings suggest that sustainability is seen as lower in importance among consumers, and that sustainability-focused certifications are even lower in priority.

Then there is the obvious disconnect between concerns about environment and human welfare and the prominence of organic certification. Do consumers mistakenly view organic certification as a sustainability credential? The organic programme was never designed to serve as a mark of sustainability; its standards and compliance measures do not include any forms of evaluation of environmental or human welfare impacts. From the producers’ perspective, compliance with organic certifications does overlap with certain compliance practices of other certifications, (e.g., non-GMO and regenerative agriculture), but these are also not certifications with a dominant emphasis on the people plus planet issues of sustainability.

Mixed results concerning certifications

On the surface, the findings suggest that industry respondents see consumers as more concerned about the impact of tea purchase decisions on their immediate and local well-being: be it price, absence of pollutants (e.g., organic), and overall food quality. However, Mintel Consulting’s recently published global 2022 Sustainability Barometer showed that consumers who are more invested in sustainable purchase decisions do rely on certifications as an important guide in making those choices.

Write-in feedback from respondents reflect split attitudes toward the role of certifications. Some respondents feel more certification, and more enforcement of certification practices is needed. Others feel that certification often places too much focus on administrative paper-pushing and not enough on-the-ground support. Some commenters believe certification alone is too costly for small farmers and not transparent enough in terms of actual practices recorded and activities in the value chain. The most often repeated comments regarding certification call for more action in terms of less economic burden for growers and legal/compulsory compliance across a unified, streamlined certification scheme for organisations.

Any discrepancies in sustainability across consumer perceptions, business practices, and certifications may soon face a re-alignment. Governments across the globe have passed or are drafting legal guidance that will require businesses to further comply with sustainability practices. For example, the European Union published its Draft Corporate Sustainability Due Diligence Directive in February of 2022. If ratified in its current form, the directive would require companies to identify and seek to rectify negative impacts on the environment and human welfare that are found within the business’s value chain. In the United States, California passed the California Transparency In Supply Chains Act, with the explicit purpose of increasing awareness of human welfare issues within organisational supply chains. These are just a couple of examples of laws directed toward enforcement of corporate sustainability practices. As these laws develop, certification bodies will likely adjust their certification process to streamline the path to legal compliance or to exceed the legal standards so that their certification badge stands out as a mark of greater distinction.

When viewed as an integrated whole, the report findings indicate that sustainability certifications may be unbalanced in terms of their perceived value to tea consumers. This may be partially due to the certification’s role in environmental and human welfare aspects of sustainability, and as a factor of public sentiment towards sustainability initiatives. Additionally, industry members tend to see more of the transparency issues and economic costs associated with certification as obstacles to providing greater value in tea sustainability.

• Jason Walker is marketing director of Firsd Tea North America. Prior to his work with Firsd Tea, Walker served in a variety of roles in tea and beverage business capacities. His experience includes business services for small tea companies, a top-ranked online destination for tea consumer education and co-founding a coffee business. His insights draw upon his diverse range of experience in sales, operations and management in the tea world. He may be reached at: jason.walker@firsdtea.com.

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Seattle’s Best Coffee’s approachable line of whole bean, roast and ground packaged coffee, and K-Cup pods are available in a variety of roasts and flavour profiles across both foodservice and grocery channels. In addition to Starbucks packaged coffees distributed by Nestlé under the Global Coffee Alliance, Seattle’s Best Coffee joins Nestlé’s roster of well-known coffee brands in the United States including Nescafé, Nespresso and Blue Bottle. The addition adds depth to Nestlé’s North America coffee portfolio by further expanding the company’s position in the category.

“We continue to deepen our partnership with Nestlé to deliver the best of the Starbucks Experience to our customers in channels outside of our retail stores,” said Michael Conway, group president, Starbucks international and channel development. “We’re confident that Nestlé will continue to grow the Seattle’s Best Coffee brand as we focus on our strategy to elevate the premium coffee experience for consumers through the Starbucks brand.”

“Our partnership with Starbucks has confirmed Nestlé’s leading position in the dynamic and growing global coffee market,” said David Rennie, head of Nestlé Coffee Brands. “With the well-known Seattle’s Best Coffee brand, we will continue to build our leadership in coffee by offering consumers more choice for their everyday coffee.”

Since forming the Global Coffee Alliance in 2018, Vevey, Switzerland-based Nestlé and Seattle, Washington-based Starbucks have brought a wide range of premium coffee products to new markets at a fast pace – including whole bean coffee, roast and ground coffee as well as Starbucks capsules for Nespresso and Nescafé Dolce Gusto proprietary systems. Today, Nestlé distributes Starbucks consumer products and foodservice beverages across more than 80 markets outside Starbucks retail stores under the Global Coffee Alliance. The total global sales of Starbucks products distributed by Nestlé in 2021 reached CHF 3.1 billion (approximately USD 3.085 billion).

Through the Global Coffee Alliance, Nestlé and Starbucks will continue to work together closely to develop new, innovative products and go-to market strategies that will amplify the reach and expand the unique experience of the Starbucks brand locally and globally.

The transaction is expected to close by the end of 2022, subject to respective board and customary regulatory approvals. Terms of the transaction have not been disclosed.

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