After hitting a 50-year low in production in 2021/22,Costa Rica’s coffee output has been rebounding. The United States Department of Agriculture’s (USDA) Foreign Agriculture Service estimates total production of approximately 1.44 million 60-kilogram bags of green coffee in 2023/24, which is up over 15 percent from two years ago. This increase is attributed to better plant management, positive initial flowering, and stabilised fertiliser costs.

Costa Rican producers have been actively innovating for the global specialty coffee market. For example, producers are responding to a trend towards increased product differentiation through microlots, which allow them to capture higher sales prices. The number
of coffee mills has increased from 184 in 2011/12 to 304 in 2021/22,with many new micro-mills
servicing small groups of farms.

Despite production increases, the number of coffee growers in Costa Rica continues to decline. As of 2021/22 (the most recent dataset), there were 26,704 farmers, down nearly 50 percent from 10 years earlier. Factors contributing to this decline include long periods of low coffee prices, aging farmers, and high land prices near urban areas.

The industry faces ongoing challenges with labour supply, particularly for harvesting. Most of the coffee harvest depends on large numbers of temporary foreign workers from Nicaragua and Panama. There have been concerns about changing immigration flows affecting labour availability.

Costa Rica’s economy is increasingly shifting towards services, with the tourism, pharmaceutical, and IT sectors growing rapidly. This economic diversification is providing more attractive employment options for the children of coffee farmers, potentially further impacting the future labour supply for coffee production.

The local Costa Rican currency’s depreciation has also negatively impacted the coffee industry.
The exchange rate has reached its lowest point in 14 years, reducing the competitiveness of Costa
Rican coffee on the international market and causing significant financial losses for exporters and mills.

Improving Resilience
Despite challenges, Costa Rica maintains its reputation for high-quality coffee. The country continues to participate in prestigious events like the Cup of Excellence, with some producers making it to the 2023 finals.

Climate change is threatening coffee-growing areas in Costa Rica, specifically the Coto Brus region. By 2050, absent adaptation measures, experts at the World Resources Institute (WRI) in Washington, DC maintain that climate change “will reduce the global areas suitable for growing coffee by about 50 percent.” An WRI study outlined key findings from this region, including some of the main challenges facing the coffee sector. It also examined existing factors that present opportunities to enhance climate resilience. The study recommends actions that can be taken to improve the sector’s climate resilience and long-term sustainability.
During the course of their research, the WRI’s team of researchers conducted a literature review, interviews, a workshop and field visits with coffee farmers, government ministries, funders, and other stakeholders.
Despite the study’s local focus, the lessons and experiences shared are relevant for other coffee-growing regions and countries: Colombia, Mexico, Guatemala, Honduras, Vietnam, Indonesia, Ethiopia, Uganda, among others. These are the places where coffee producers are facing some of the harshest the effects of climate
change, and the researchers hope that it will serve as a tool and inspiration for accelerating adaptation action.

Despite the benefits of medium- and long term planning to accomplish the large-scale transformative changes, WRI’s experts concluded that the coffee sector will need to adapt to intensifying climate impacts. However, they found that most producers are integrating smaller, short-term, incremental adjustments that might not be sufficient in the long term.

WRI developed a program to assist Costa Rica’s government as it mapped out short-term, medium-term, and long-term adaptation pathways that are inclusive, equitable, and participatory. WRI developed a framework which underscores that, in some situations and locations, incremental adaptation measures will prove insufficient in the years to come to fully reduce growing risks from climate change impacts. In these situations, more fundamental, or transformative, changes – which may entail creating pathways toward new systems more suitable for changing climate conditions – will be needed to maintain the communities’ livelihoods in the long term. Such changes will often include shifting the mix of crops grown
and livestock raised in particular areas, employing substantially new technology at broad scale, and/or altering the production landscape from one type to another. The first year of WRI’s technical assistance
effort focused on stakeholder engagement, research, and in-country discussions via workshops to introduce the concept of transformative adaptation and establish a dialogue on climate adaptation, vulnerabilities, and impacts. These discussions were held with coffee producers, cooperatives, ministry
officials, research organisations, financing entities, and the private sector, among others.

Findings from these conversations are being used to inform the drafting of a national coffee strategy.
The focus of the second year of the project focused on the lessons learned from the coffee growing region of Coto Brus to better inform, guide, and finance climate resilience efforts for these communities, while extracting insights for other coffee-growing regions in the country.

Reviving Production in Coto Brus

The Coto Brus district, located in the Brunca region, is one of the country’s eight coffee growing areas identified by the Coffee Institute of Costa Rica (Instituto del Café de Costa Rica; ICAFE) and one of the smallest contributors to national production. Coto Brus was chosen by government counterparts in response to smallholder farmers’ requests for support and because this area has been experiencing a rapid decline in coffee production and is highly vulnerable to climate change. In the second year,
WRI conducted literature reviews, expert interviews, farm visits, and a full-day workshop in Coto Brus with key stakeholders.

By 2050,absent adaptation measures, up to half of the areas currently suitable for coffee cultivation in Coto Brus is predicted to become unsuitable across both low and high emissions
pathways scenarios. (For more details, consult the various research reports and studies published by Oriana Ovalle Rivera of the CATIE – Centro Agronómico Tropical de Investigación y Enseñanza – which is located in Turrialba, Cartago, Costa Rica.) Central areas are projected to be more adversely affected while a few locations are projected to see an increase in suitability.

Efforts to increase Coto Brus coffee farmers’ resilience by addressing the most immediate climate change impacts have begun. However, few farmers incorporate adaptation into their planning and huge implementation gaps persist, despite a broad awareness of sustainable practices. According to interviewees, some farmers are further behind than others — especially smallholders with more limited
resources. Despite the benefits of medium-term and longer-term planning to accomplish the large
scale transformative changes the coffee sector will need to adapt to intensifying climate impacts, most producers and the sector are integrating smaller, shorter-term, incremental adjustments that might not be sufficient in the longer-term.

WRI’s study identified key recommendations to increase the short-term, medium-term, and long-term climate resilience of the coffee sector. The recommendations include:
• Promote adaptation options identified by local stakeholders, provide regular technical follow up, and support farmers in exploring additional medium-term and longer-term measures.
• Establish baselines and monitor the impacts of adaptation measures. Building the evidence of farms’ vulnerabilities while tracking the results of adaptation efforts can help maximise the allocation of limited resources over the short, medium, and long terms and inform where and when transformative pathways will be needed. Transformative pathways are coordinated sequences of short to-long-term actions or projects intended to prepare agricultural systems for unprecedented climate conditions.
• Map when and where coffee is likely to lose viability in the coming decades and explore transformative and equitable pathways toward climate resilience, with stakeholder participation (particularly relevant for MAG, ICAFE, and MINAE). At-risk farmers should be supported to experiment with different crops,
technologies, and even livelihoods like eco tourism that will serve them better over the longer term.
• Reinforce existing institutions and enabling factors to increase the uptake of adaptation measures and build greater resilience in Coto Brus. These include strengthening farmer associations and cooperatives, as well as farmer-to-farmer learning; promoting more strategic cross-sectoral alliances; and strengthening support for programs focused on sustainable practices.
• Develop farmer-tailored skills trainings and guidance to build farmers’ capacities to manage costs and access credit and financing, so they can more easily invest in adaptation measures.
• Create open communication channels within public and private entities to bridge crucial information flow gaps around climate risks, existing vulnerabilities, and options to support the implementation of adaptationmeasures. Providing producers with clear, complete, and practical information on different financing options is also essential.

• Gordon Feller, based in California, travels the world reporting about innovations that can change our economies and strengthen small enterprises. Since 1980 he’s been publishing
  reports and magazine articles about coffee/tea innovations on five continents. He is both an ABE Fellow – Japan Fdn and Global Fellow – The Smithsonian

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In 2024, COE is expanding its training and education opportunities for professionals with the introduction of the Origin Immersion programme. COE founder, Susie Spindler said “The Cup of Excellence organisation has always been in a unique position to go one step beyond traditional cupping training and offer an in-depth understanding of the wide diversity of coffees, the culture and the farmers in our partner countries. I am excited for these classes to spark the curiosity, appreciation and relationship building that is the hallmark of its mission.”

El Salvador has been selected as the premier country to be featured in this new immersion programme with the first programme kicking off in February 2024. By holding this course at origin, participants will be immersed in the traditions of the country while they delve deep into the coffee industry.

El Salvador has been a featured country of the Cup of Excellence programme since 2003 when the first COE competition was held there. Carolina Padilla, president of the Salvadoran Coffee Institute says of this opportunity, “The Salvadoran Coffee Institute is excited to see Cup of Excellence bringing back coffee buyers to origin. This initiative allows buyers to come closer to coffee producers, so they can learn closely about all the efforts and dedication they put into their coffee production. We are proud to showcase Salvadoran coffee culture, heritage and varietals such as Pacamara. We will highlight our traditional varietals so that coffee roasters can develop a deeper understanding on how to roast and appreciate them so they can share with their customers worldwide.”

The El Salvador Immersion programme will be led by COE head judge Luis Rodriguez. Luis’ history in coffee began in 2001 when he served as the head of the Economics Department for the Salvadoran Coffee Council. Since then he has become a coffee producer, Q Grader, lecturer and instructor, as well as a coffee producer.  He has been actively involved with the COE programme since 2003, assisting to coordinate the competition in El Salvador, acting as a head judge, and has been a participant in the COE competition as a winning producer. When asked about the Immersion programme, Luis said, “I’m thrilled to have the chance to participate as a trainer in this ACE/COE immersion programme in my home country. We will make sure attendees gain knowledge of the remarkable features of El Salvador with hands-on and customised training while hosting an integral and exciting origin experience. Attendees will discover why El Salvador has evolved from being a hidden jewel to being considered a specialty coffee powerhouse due mostly to our versatility and vanguardist growers.”

For more information visit: cupofexcellence.org.

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“We’re honored to partner with Cup of Excellence and the Alliance for Coffee Excellence as their new technology services partner. Our goal is to support COE and ACE as they expand their auction and event services to better scale their market access and financial impact for coffee producers. M-Cultivo is thrilled to build an evolved, scaled model for various auction types that not only provides more opportunities for quality discovery and direct-trade relationships, but will provide a more streamlined user experience for buyers. We look forward to working alongside and enhancing the auction experience for all stakeholders in the auction process,” said David Paparelli, founder and CEO of M-Cultivo. 

With features including an integrated payment option for buyers and a robust back-end lot management for in-country organizations and producers, the auction platform will support increased financial reward and better margins for producers while creating efficiencies in the auction process, logistics and sample set management.  

The new platform will offer a check-out process on winning bids with multiple payment options including credit card and wire transfer. Credit card fees will be passed on to the buyer to avoid extra costs for producers. Shipping options will also be expanded and managed directly at check out allowing buyers to select options including: air-freight, consolidated air-freight, ocean freight, and self-managed. Information about the winning coffee and photos of the producers will be displayed by each lot. Bidders will also enjoy customizable auto-bidding by choosing increment levels and maximum bids. Lastly, there will be an on-demand support chat and resource center. 

“This work and partnership with MCultivo in building a platform together to meet the needs of our principle partners, the coffee producers whom we serve, is vital to our mission. As a non-profit, we feel this work with a group committed to enriching farmer livelihoods is key to our strategic plan for the future,” said Darrin Daniel, executive director, Alliance for Coffee Excellence and Cup of Excellence.  

Along with the new auction platform, the organizations – which launched a Brazil Select Marketplace pilot program in late 2021 – will also focus on other technology services to better forge direct-trade relationships. Following the pilot program in Brazil, an Ethiopia Select Marketplace will feature over 80 individual farmers, dramatically increasing the market reach and securing higher premiums for producers who entered the CoE program. This direct–to-roaster marketplace for coffee vetted by Ethiopia National Jurists will run from 8 August to 15 September, 2022. 

For more information about the new auction platform and marketplace, please visit http://mcultivo.com/. To register for an auction, please visit https://allianceforcoffeeexcellence.org/.

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