We have read the essay posted by Professor B. Holt on January 26th 2007, titled Is Starbucks “Coffee That Cares”. After doing so, we felt compelled to describe a very different Starbucks, completely opposite to the image portrayed in such document.

Our group consists of all the major Cooperatives, Millers and Exporters of Costa Rica. The following text was drafted by : the FENAC-CAFÉ R.L. (Federación Nacional de Cooperativas de Café, grouping all the major coffee Farmer Cooperatives in Costa Rica), the CNC (Cámara Nacional de Cafetaleros, grouping all the major coffee Millers of Costa Rica), the CNEC (Cámara Nacional de Exportadores de Café, grouping all the major coffee Exporters of Costa Rica), and the SCACR (Specialty Coffee Association of Costa Rica, a trade organization devoted to promotion of quality coffee in Costa Rica).
Costa Rica is a small country, but we pride ourselves in producing some of the best coffees in the world. Our local legislation (and culture) is also very advanced in terms of social and ecologic policies. Such strict policies make coffee growing/milling/exporting an expensive affair. Therefore Costa Rica has a very hard time competing with other mass producing nations.

The Starbucks WE KNOW was the first company to ever pay prices for coffee significantly above world market levels. This mode of buying started in the late 1990´s coming to the turn of the century. As far as we know there is no prior record of any company adopting this practice (for large volumes) in coffee history. Before Starbucks began paying such premiums, most of our good coffees were part of the “commodity basket” trading at price levels very close to lesser quality coffees. Even when world market prices hit the lowest levels in recent history, Starbuck stuck to their principles and paid almost twice as much for their coffee.

In those days Starbucks explained their concern for the wellbeing of coffee producers. They recognized the threat that low market prices represented to the sustainable production of good coffees. While their concern may have been in some ways self motivated (i.e. guaranteeing long term supply of the coffee they needed), their actions reflected a desire for partnership, working together with producers, helping them in these desperate times. We think this “everyone wins” mentality is much more productive than mere charity.

Already in 2001, Starbucks buying behavior had caused a revolution in our day-to-day trading. A two-tier market was born; the “normal market” and the “Starbucks quality market”. The price difference between these two was very significant. This came to be known internally as the Starbucks effect”. It meant that every area reached by Starbucks became protected in a sort of price-bubble. Production in these “protected” areas is still stable or even rising to this day. On the other hand, the areas that they could not reach have shown dramatic production losses in the last few years, and may even face partial or total eradication of coffee plants.

During all this time, Starbucks has never attempted to monopolize the use of names relating to geographic regions or special production processes in Costa Rica. Starbucks has always looked at the intrinsic value of the coffee, how it tastes on the cup. It is based on samples and compliance to their CAFÉ PRACTICES program that Starbucks chooses their suppliers.

The Starbucks we know is not a cold self-serving multinational. Their name and green logo have become household images in Costa Rica. Not because Costa Ricans drink lattes. There are no Starbucks coffee houses operating in our country. Their name is known because people, government, and the coffee community in general recognize what they have meant for us during the last 7 years: a solid ethical partner, a defense against market forces, a standard for promotion of good growing practices, and a trampoline for promotion of our name in the market place .
We have come to know Starbuck’s executives very closely. We have seen their CEO Jim Donald having a simple lunch at the house of a small producer, sharing with the producer’s family and later attending large producer-group meetings, extending all sort of courtesies. We saw the birth of CAFÉ PRACTICES, a program that was the first of its kind, announced right here during a Sintercafe convention in San José. We also witnessed the opening of their farm-support center in San José, an office entirely devoted to facilitating the implementation of CAFÉ PRACTICES in Latin America.

YES, WE THINK STARBUCKS CARES. We have seen it with our own eyes. While we cannot refer to the specifics of the Ethiopian issue, we think it is unfair to simply ignore the track record and proper behavior of this company, consistent for so many years. It is wrong to form an opinion without looking at the entire picture. Starbuck’s actions through the years deserve that people pay attention to their arguments. We think they have earned such right for credibility. They have certainly walked the walk.

Costa Rica is a blessed coffee nation. It is a place where good quality, social consciousness and genuine care for nature (finally) meet. We have no doubt that this is still a reality thanks to Starbucks’ behavior during the last 7 years.

You can listen to the broadcast via this link:

http://www.valleyfreeradio.org/2006/12/corporate-watchdog-4/

I’ve hear that Dean Cycon of Dean’s Beans wrote a pretty interesting letter about this (He was a trade lawyer in a past life). However, I haven’t been able to dig it up online. Perhaps you or one of your devoted readers knows where to find it?

Nice overview.