Can Great Coffee Save the Jungle?

Early on an arid afternoon, in a building high in the hills of Nicaragua’s Las Segovias province, four North American men sit around a small table sipping freshly roasted coffee from spoons. Sipping is actually too gentle a word: it’s more like a loud slurping, interrupted by kibitzing.

“I got a Baby Ruth vibe from that one,” says Peter Giuliano, his dark eyes shining behind thickrimmed black glasses. “There was a lot of a real caramel, nutty taste that turned me on, though on balance it was too forward.” Giuliano’s title is master roaster and green coffee buyer for Counter Culture Coffee, in Durham, North Carolina.

Across the table, the tall and bearded Geoff Watts, director of coffee for Chicago’s Intelligentsia Coffee Roasters, shakes his head. “I thought it was leathery—in a dry, leathery way,” he says.

The four coffee buyers scribble on pads of paper, rating such things as acidity, balance, appearance, aroma and aftertaste of brews from five regional farms. Hovering over them is Paul Katzeff, who organized this weeklong tasting tour of Nicaraguan farmers’ coffee cooperatives. The 66-year-old CEO of Thanksgiving Coffee, in Fort Bragg, California, wears the proudly anxious air of a man at his daughter’s wedding.

There’s a lot on the line at this tasting at PRODECOOP, Nicaragua’s largest coffee cooperative. Katzeff believes that good coffee, sweetened with social justice, has the power to change the world, offering dignity to the downtrodden and protecting the forests that provide their income. He has invested much of the past 17 years in caffeinated nation-building in these rolling northern hills. And he’s certain he’s seeing the fruits of his labors this very minute, as the North Americans spit their spoonfuls into nearby cans, asking questions of Eduardo Videla, a stocky, smiling farmers’ representative who pours fresh cups and eagerly writes down their concerns. “If this group is happy, it will mean a lot,” Videla whispers.

The fragrant sacks of beans that have produced these roasted samples have been trucked to the “cupping lab,” a tiny roasting kitchen and café, by farmers who often don’t drink their own coffee, let alone describe it or consider comparisons with Baby Ruth candy bars. Teaching them the mysteries of marketing is the idea behind the lab, a simple tool designed by Katzeff to improve quality control, nurture relationships between farmers and buyers, and, oh yes, save the forest. “We’re bringing parts of the trade chain closer together,” he says, nodding toward Videla, who is in earnest conversation with the visiting buyers. “The sound you hear is the sound of walls falling.”

The goals of a better cup of joe, social justice and a healthier environment are nowhere more tightly entwined these days than in this small Central American nation, with its turbulent history of hurricanes, earthquakes, volcanoes, revolution and U.S. intervention. The coffee buyers on this trip say that Nicaragua has recently become the “hot origin” for gourmet coffee, with its beans winning taste awards and its decent wages for many small farmers a hopeful beacon for a global coffee market under siege. “Nicaragua is where you see the future of socially responsible coffee,” says Katzeff.

A coffee crisis began in 1999, when new production in places like Brazil and Vietnam, among other things, caused a surplus—the international aid agency Oxfam estimates that more than five billion pounds of coffee go to waste each year—that quickly pushed prices in some parts of the world below production costs. Between 1999 and 2002, the price of coffee was halved in a race to the bottom that has trampled many of the world’s 25 million small coffee farmers, throwing millions out of work and off their land and leaving families impoverished and malnourished. And as farmers have despaired, the quality of coffee has suffered.

But what does gourmet coffee have to do with rescuing the forest, or the families who tend it? It’s all about shade: today’s crisis stems mostly from an overflow of cheap, sun-loving, easy-to-grow robusta beans from chemically fertilized plantations in Brazil and Vietnam. The best-quality coffee, most traders agree, comes from delicate, sun-intolerant Arabica plants, which tend to be grown on small farms. Here in Nicaragua, arabica is grown in rain forests more than 3,000 feet above sea level, sheltered by orange, mango, mahogany, rosewood and inga trees. The rich soil nurtures the coffee plants, while the forest canopy shelters both the berries and a host of bats and birds.

Over the past decade, U.S. and European coffee traders have worked to give the farmers here and in forests like these around the world access to better-paying “specialty coffee” niche markets. Convincing consumers to pay more for quality coffee gives farmers an incentive to farm in a way that preserves the forest—vital at a time when the planet is losing, according to United Nations estimates, some 30 million acres of tropical forest each year.

Today, coffee drinkers who care about the environment and want to help coffee workers have essentially two choices: organic coffee, free of chemical fertilizers and pesticides, which appeals to an increasing number of individuals concerned about their health and that of the planet; and socalled Fair Trade coffee, for which importers agree to pay producers an above-market price of $1.26 a pound. (Today, the majority of Fair Trade coffee is also organic, which raises the price paid to farmers to $1.41 a pound.) The idea is catching on, slowly: Starbucks has sold Fair Trade coffee in small quantities since 2000, and says it pays at least $1.20 per pound for the rest of its beans. And late last year food giant Procter & Gamble agreed to sell Fair Trade coffee wholesale through its specialty division, Millstone.

Yet Katzeff, a Bronx-born former social worker and lifelong champion of underdogs, says neither alternative works. “Fair Trade is a totally flawed system,” he says, even though his company endorses it and has sold more than 450,000 pounds of Fair Trade coffee in the past four years. “The policy is to try to enlighten people, but you can enlighten 100 percent of people and maybe get 5 percent to change their behavior.” A case in point: when Berkeley, California, had a ballot initiative in 2002 proposing that local cafés sell only Fair Trade, organic and “bird-friendly” coffee (the latter a certification program to protect birds overseen by the Smithsonian Institution’s MigratoryBirdCenter), voters overwhelmingly rejected the plan. Today, Fair Trade makes up only about .5 percent of the $18.5 billion U.S. retail coffee market. And Katzeff calls organic coffee, which accounts for 1 percent, a “miserable waste of time—people don’t want to think about their health when they drink coffee.”

Katzeff is convinced that the answer lies in getting consumers hooked on high-quality coffee—and that the best way to help small farmers produce better beans is by putting key tools of the trade in their hands. Until recently, for example, cupping labs could be found only among wealthy middlemen. Without the lab feedback, Katzeff writes in The Coffee Cupper’s Manifesto, a Spanish/English manual, small-scale growers are like “a baseball player with poor eyesight and no glasses, facing a 90-mile-per-hour fastball pitcher.”

Three years ago Katzeff won a $291,000 grant through the U.S. Agency for International Development to establish nine such labs in Nicaragua’s northern mountains, including the one in Las Segovias. Of course, if there were ever strange bedfellows, it’s the U.S. government and Katzeff, who ran gonzo journalist Hunter S. Thompson’s 1970 campaign for sheriff in Aspen, Colorado. In the mid-1980s, Katzeff sued President Ronald Reagan and then-CIA chief George H.W. Bush for embargoing Nicaragua, which they did to cripple what at the time was its revolutionary Sandinista government. Even today, Katzeff sells coffee in bags adorned with a portrait of Che Guevara to protest the U.S. ban on trade with Cuba.

On his first trip to Nicaragua, as president of the newly founded Specialty Coffee Association, in 1985, Katzeff worried about how he’d be received by the Sandinista government, then under siege from a U.S.-supported “Contra” rebel war. Arriving at Managua’s SandinoAirport, he recalls uniformed Sandinistas whisking him past immigration officers and introducing him to a high-level agricultural official. “Nicaragua needs you to be big,” the official told him.

Katzeff says he quickly fell in love with the country—which is blessed with plentiful mountain terrain and has experienced less deforestation than more densely populated neighbors like El Salvador—and with its coffee. “It’s sweet, fruity, caramely, lively in the cup: it makes you salivate,” he says. “It’s easily among the world’s best coffees.” Adding to Nicaragua’s natural advantages, the Sandinista government organized farmers into cooperatives, well-disciplined support groups that have played a strong role in the pursuit of higher quality beans.

Coffee harvesting and processing are two of the most labor-intensive jobs on earth, and quality can depend on organization. Afew over-fermented beans, known as varros, or “stinkers,” from one careless farmer can spoil the hopes of several of his neighbors. PRODECOOP is one of the few companies that pay workers to hand-sort beans after they’ve been mechanically sorted.

This extra care is a major reason for PRODECOOP’s success despite the plummeting global coffee market. The co-op has a loyal foreign clientele and has passed on $1.10 a pound to farmer members by selling more than 80 percent of its beans to Fair Trade buyers in the United States and Europe—exceptional even for Nicaragua, where, despite all of its natural and social advantages, thousands of farmers haven’t been able to earn back production costs. It’s also evidence that Katzeff’s profit-oriented appeal to quality-conscious buyers is bearing fruit—or beans.

On this visit to Las Segovias province, Katzeff is sharing his contacts with colleagues, including some competitors, in hopes of building the market for Nicaraguan coffee. Not content to rely on importers, many U.S. buyers already spend several weeks a year prowling the rural hills of Asia, Africa and Latin America. “It would be an exaggeration to say the entire gourmet industry is moving in this direction,” says Doug Zell, president of the Intelligentsia roasting company and a member of Katzeff ’s tour. “But the leaders of the industry are doing it. About 20 guys are chasing each other around on these trips, telling the co-ops, ‘we’ll work with you to get a better result, and when you do we’ll pay you more.’ ”

Gourmet coffee is still a relatively young concept in the United States, where coffee drinkers paid virtually no attention to quality until the 1960s—about the time that the fictional Juan Valdez began promoting Colombian coffee in magazine ads and TV commercials on behalf of Colombia’s National Federation of Coffee Growers. The poncho-wearing peasant, with his trusty burro, gently educated Americans about the hard work involved in producing fine mountain-grown beans, “the richest coffee in the world.”

Then came the phenomenal rise of Starbucks and other gourmet coffee brands, which persuaded consumers to pay for richer flavors. The education of the American coffee palate had begun, though connoisseurs still say Starbucks’ dark roasts obscure subtle flavors—hints of cashew, lemon, blueberries or orange—and that the chain overpromotes sweetened concoctions that completely overwhelm the flavors. “Starbucks is in the milk business,” Katzeff sniffs.

The buyers on this trip are betting that discerning Americans will one day be as knowledgeable about their java as they are about wine. Even as overall U.S. coffee demand has waned over the past few decades as consumption of soft drinks and bottled water has risen, sales of specialty coffees have been increasing and now make up nearly 20 percent of the world market; U.S. retail revenues, too, have risen dramatically in recent years, from $7.5 billion in 1999 to $8.96 billion in 2003.

On this trip, Katzeff invited Byron Corrales, 45, a third-generation Nicaraguan coffee farmer, to join him on an inspection of co-op coffee plants near the town of Estelí. Walking briskly along a mountain trail, Corrales points out an excess of sun here, an apparent fungus there.

“It’s a craftsman’s job. You’ve got to love it every day,” Corrales says, rubbing a dark, shiny leaf in his fingers. He counts off 32 steps in farm-based coffee-processing, starting with understanding the soil, selecting the right seeds and cultivating plants in nurseries, and proceeding through laborious multiple harvests (since the fruit of coffee plants ripen at different times), fermenting, washing, and drying in the sun.

Corrales also makes different mixtures of compost—from coffee grounds, cow manure and other farm waste—for different stages of the plants’ lives. “When they are producing fruit, you must treat them with more respect, just as if they were a mother,” he explains. The extra care has paid off: in December 2002, Corrales won top marks from Coffee Review, a leading buying guide, which called his brew “extraordinary, luxurious coffee, lushly sweet” with “opulent fruit tones and delicately intense floral high notes.”

When Corrales isn’t tending to his plants, he’s helping run CafeNica, a three-year-old national association with a membership of 6,000 small-scale farmers. In that capacity, he has joined with Katzeff to build the country’s first large roasting plant. Katzeff believes the roaster will not only give farmers more control over the process but may also significantly reduce the price of Fair Trade coffee to consumers while adding quality control at the source. “With this kind of structural change, you don’t have to change anybody’s thinking,” he says.

Well, maybe not. In a 2002 report titled “Mugged: Poverty in Your Coffee Cup,” Oxfam recommends a “rescue plan,” in which rich consumer nations would donate funds to help generate other sources of income. Katzeff and others dismiss the charity-dependent idea as hopelessly unrealistic.

Yet simply improving coffee quality won’t save every small farmer. Many may soon have to leave the business. In the meantime, Katzeff hopes Nicaragua’s model of quality control and personal relationships between farmers and buyers catches on. In February, he brought Rwandan farmers to Nicaragua to learn from the success of Corrales and others. Bit by bit, he’s helping the farmers who survive produce a brew that pleases both the palate and the heart.