Azernews.Az

By Bloomberg

Starbucks Corp. is under fire from Colombian farmers and an opposition lawmaker for offering foreign coffee at its Bogota stores after pledging to serve “100 percent locally-sourced” brew in the Andean nation.

When it opened its flagship outlet in the capital last July, the company said its Colombia stores would be “the first anywhere in the world to serve exclusively locally-sourced Starbucks coffee,” as well as “whole bean packaged coffee from other markets around the world.” Yet the Seattle-based company also serves cups of coffee from Guatemala, Kenya, Panama and Hawaii at its Bogota stores, frustrating local growers.

“They came here and made a promise,” said Oscar Gutierrez, a spokesman for Dignidad Cafetera, a national coffee farmers’ lobbying group. “It’s very bad for Colombia that a multinational comes here, sells foreign coffee and sends the profits back to its headquarters.”

Alisha Damodaran of Starbucks’ Global Communications said by phone that the “100% locally-sourced” pledge applies to drinks such as cappuccinos, frappuccinos and espressos sold in the stores, and hasn’t changed. Colombia and India are the only countries where this guarantee exists, she said, which means that a customer ordering an espresso in a Bogota outlet would be given local coffee.

Colombia, the world’s largest producer after Brazil and Vietnam, has faced repeated turmoil on its coffee farms in recent years including a price crash and outbreaks of insect and fungal attacks. In 2013, falling prices sparked protests as coffee growers blocked highways and fought police while demanding government aid.

Price Slump

Jorge Enrique Robledo, an opposition senator from Caldas province, one of Colombia’s main coffee-growing regions, said Starbucks’ sale of foreign coffee is hurting Colombian farmers at a time when they are facing a “grave” situation due to a slump in prices.

“This is a way of importing coffee into Colombia, and it damages the coffee growers,” said Robledo, who represents the Alternative Democratic Pole party.

Arabica coffee prices have fallen by about 32 percent over the last six months, amid improving prospects for the crop in Brazil, the world’s top producer and exporter. Gutierrez and other coffee leaders are meeting with lawmakers on March 9 to seek government assistance for growers.

Juan Valdez

Colombians drink less coffee than other Latin American producing countries, even after repeated campaigns backed by the National Federation of Coffee Growers aimed at boosting internal consumption. The Federation owns the Juan Valdez brand, which competes with Starbucks in Colombia.

The average Colombian consumed 1.5 kilograms (3.3 pounds) of coffee last year, according to a study by Euromonitor International, a business research group. That compares to 3.7 kilograms per capita in Costa Rica and 5 kilograms per capita in Brazil.

Colombia sold 11 million bags of coffee abroad last year, making the crop its biggest export after oil and coal. Its coffee trades at a premium to other Arabicas on ICE futures U.S. exchange in New York because the nation’s mild-tasting beans are favored by specialty roasters, including Starbucks.

The company sells Colombian coffee in the U.S. and elsewhere via its Narino Supremo and other brands, and has been buying beans from the nation since 1971.