Coffee's innovation crisis
Mywish K. Maredia, Jose Maria Martinez
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Coffee is the world’s most popular beverage and consumption is expanding in both importing and exporting countries, but the looming climate change crisis poses an existential threat to coffee producers. At the same time, coffee has seen persistently stagnant or declining productivity trends in most producing countries outside the three biggest producers—Brazil, Vietnam, and Colombia—despite prior calls to action and collective efforts to address this challenge.
This combination of factors should be a cause of urgent concern for the whole industry. If current trends continue, we will be unable to meet the world’s growing demand for coffee, let alone to ensure that coffee production is economically and environmentally sustainable. Increasing global investments in coffee R&D to accelerate innovations across multiple countries can help reverse this trend and support the coffee sector to keep up with growing consumer demand and respond to the challenges of climate change and poverty, while avoiding further consolidation of production.
Yet coffee’s current level of investment in agricultural R&D is shockingly low. We estimate that current total agricultural R&D investments in coffee for the global south total is about US $115 million (in constant 2020 US dollars). In our estimates, 90% of these investments are made by the public sector and 10% are made by the private sector. As a general rule, R&D investments to different commodities should be allocated proportionally to their market value (Fuglie, 2022). The total value of green coffee makes up about 4.8% the of total value of agricultural output in the 45 countries included in this analysis. Coffee should therefore make up a similar percentage of agriculture sector investments in these countries—yet today, the investment amount is a mere 1.8%.
