The Gross Inequality Of Wealth Distribution In The Coffee Industry Is Shocking...

For those of you who follow us on Twitter you will have seen the infographic Co-fe recently shared from @Guatemalacoffee a simple, yet powerful piece that gets right to the heart of the issue in the coffee industry. For those of you who haven't seen it, here it is:

It’s super simple and straight to the point, that is why we love it. It really highlights the issues with the current coffee supply chain. The majority of the middle-men agencies within the chain operate outside of the coffee producing country and they siphon off the lion’s share of the profits for their own pockets.

Now, of course, you could say ‘that’s just business’ and walk away. In almost every industry you can find similar instances. People in business are out to make money from themselves, however, this usually comes at the expense of people worse off than themselves. In the coffee supply chain, this means the farmers suffer the most. The people who are already living and working in poor conditions have no way to maximise the value of their work.

As they each operate individually or as a small co-operative (in comparison to the big players in the chain) they have no real bargaining power. They much accept the price given to them by the supply chain. The businessmen in the supply chain want to make themselves a lot of money so they push the costs down and invariably offer the farmer the lowest possible price.

And don’t kid yourself about fair-trade coffee, in some cases, it might be fairer, but even then not by enough to really make a difference.

However, what happens if you remove a number of middle-men agencies from the supply chain? If you enable farmers to deal directly with the end-consumers and roasters of the coffee? Before now there has been no way to do this in a secure manner, but with the growth of blockchain and cryptocurrency technologies, we suddenly have a method to do this in a way that protects all three parties.

Cryptocurrencies allow for transactions occur directly between any two of the three parties. For example, the consumer can transfer money straight to the farmer without going through a third-party. This happens in a safe and secure manner for all parties and most importantly doesn’t incur a cross-border payment fee, meaning that the transaction remains a cheap and viable option. This is then recorded on the blockchain, which acts as a public ledger. This means that the transaction is completely transparent and that everyone can inspect the deal to ensure that farmers are receiving fair value for their work.

Unlike the current supply chain, the blockchain can allow the coffee industry to operate in a completely fair and transparent manner. If you are in the coffee industry, or simply passionate about making the world a better place, and want to find out how you can help, email our founder at [email protected]. 

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