Heifer CEO: Low coffee prices one cause of border crisis

Written by: Steve Brawner
Published by: Talk Business & Politics

Guatemalan immigration to the United States is rooted partly in low coffee prices, the CEO of Heifer International said Monday (Nov. 25). However, the United States must learn how to create better farm markets domestically before it can help Central Americans improve theirs, said U.S. Rep. Rick Crawford, R-Jonesboro.

The two made their comments during a panel discussion at the Clinton School of Public Service Monday in Little Rock. The panel also included Manuel Espina, Guatemala’s ambassador to the United States, and University of California Irvine professor William Hernandez Requejo.

Heifer CEO Pierre Ferrari said the border crisis is linked to a crisis of poverty, with low coffee prices being one cause. Coffee farmers in Guatemala are being paid 62-63 cents a pound but face production costs of between $1.30 and $1.50. If they are unable to make a profit, they often try to come to the United States or Mexico to find work.

Ferrari said farmers make about 2 cents for a cup of coffee sold at profitable American companies like Starbucks. If farmers were paid 5 cents or a dime, it would make a huge difference to them. He said paying the farmers fairly would cost Starbucks $300 to $400 million annually.

Conditions for farm workers in Costa Rica are also “desperate and deplorable,” because farm owners aren’t being paid well, either, he said.

“There’s a lack of fairness in the system that is so acute that it is part of the issue that we have to deal with,” he said.

Heifer is working to help Guatemalan farmers diversify into growing spices, which are profitable. Meanwhile, the Little Rock-based charity will increase the attention it pays to these inequities.

“We’re going to get more and more public about this because we think it’s an outrage,” he said.

Requejo agreed that better economic situations would reduce immigration to the United States from Guatemala, El Salvador and Honduras.

“If we give this populace sustainable livelihood, they will stay,” he said. “And if they stay, then a lot of those migratory pressures, whether it’s at the Guatemalan-Mexico border or whether at the California-Mexico border, that significantly decreases.”

Ambassador Espina said the majority of immigration out of Guatemala comes in the agricultural sector. Guatemala has signed a memorandum of understanding to have more temporary working visas in the United States and is working to have more service visas as well.

Crawford said the problems occurring in Guatemala also are occurring in Lee and Phillips Counties in Arkansas. As in Guatemala, farm workers are leaving the Arkansas Delta looking for work.

“Agriculture won’t solve every problem, but you’ve got to figure out, how do you make a product profitable? If the market’s telling you one thing and you’re not responding, that’s a problem,” he said.

Crawford said lessons learned in the United States could be applied elsewhere regarding creating value for farmers.

“If you don’t control the value chain, you’re captive,” he said. “So how do we implement strategies to create a value-added, a vertical integration model in agriculture that empowers the grower? We’ve got to figure that out in the United States before we can go tell Guatemala how to do it.”