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Why coffee prices continue to drop

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Despite a steady increase in coffee consumption around the world, trade prices have fallen dramatically in the past three years.
Futures on arabica and robusta, the most widespread varieties of coffee, have fallen 40 per cent since 2017 and are now at historically low levels.

This is largely because of bumper harvests in Brazil, the world’s main coffee producer.

But at the same time, consumption has grown by an average of 2.1 per cent a year for the past decade, according to the International Coffee Organisation (ICO).

Two billion cups of coffee are drunk every day, according to Fairtrade International, which works to improve the lot of farmers through better pricing and conditions.

The crisis in prices is beginning to create “real structural problems” for producers, said Valeria Rodriguez, a manager at Fairtrade organisation Max Havelaar France.

“The consequences are terrible – they can no longer support themselves, invest in production or prepare for the challenges of climate change,” she said.

Supplier woes
In central and south America, many smaller producers in Africa and Latin America are giving up in particular those who grow arabica, which is more difficult to produce than the robusta variety favoured in Asia, according to Jack Scoville, a futures markets analyst with Price Group.

A similar trend is observable in Africa for reasons ranging from high production costs in Kenya to insecurity in significant producers like Cameroon.

Few growers have the money to invest, and access to the kind of fertile land they would need to switch to mechanised processes with economies of scale is limited.

As a result, “origins with a higher cost of production such as Colombia, Honduras and Guatemala are forecast to produce less coffee for the 19/20 season”, said Geordie Wilkes, head of research at Sucden Financial.

ICO figures published last week illustrate the trend: South America will see production fall 3.2 per cent in the coming season, compared with 0.9 per cent worldwide.

At the same time, “demand for high quality is very strong”, which protects prices for certain varieties and in certain regions, said Carlos Mera, analyst at Rabobank.

Max Havelaar France guarantees its producers a minimum price of $3.10 per kilogramme of coffee, plus a bonus if the coffee is organic.

Price fixing
But Fairtrade represents only a small section of the market, and the vast majority of producers are vulnerable to prices fixed by traders in London or New York.

However, the low prices they set “do not affect consumer prices”, said Paul Belchi, also from Max Havelaar France.

This is because the supply chain is long, running from the plateaus of South America to trendy coffee shops in the world’s big cities.

When you take into account merchants such as giants Nestle and Lavazza, transportation, real estate prices and staff, the trade price of coffee is only about 10 per cent of what you pay at the counter.

Rarer varieties like Jamaica Blue Mountain, Tarrazu Costa Rica or Bourbon Pointu from Reunion have prices more akin to caviar, negotiated directly between the producer and the merchants.

Some of these varieties change hands at more than $110 per kilogramme, compared with less than $2.20 that arabica fetched Friday November 8 on New York’s ICE Futures US. For consumers, Bourbon Pointu is currently selling online for $54 for 125 grams; $432 per kilogramme to be sure.

Source: Daily Monitor

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FARM NEWS

Report links 1,600 deaths to pesticide poisoning

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A total of 1,599 deaths between 2017 and 2022 were linked to organophosphate (pesticide) poisoning, researchers from Uganda National Institute of Public Health (UNIPH) and the Health ministry found.This information is in one of the reports presented yesterday during the 9th National Field Epidemiology Conference in Kampala.

The study led by Mr Robert Zavuga was based on the data from the District Health Information System (of the Health ministry), which is received from health facilities across the country.“A total of 37,883 (average of 6,314 per year) organophosphate (OP) [health facility] admissions and 1,599 (average of 267 per year) deaths were reported,” the report reads.

OP admission was defined by researchers as a hospital stay due to suspected OP poisoning. In contrast, OP poisoning death was defined as inpatient death with OP poisoning listed as the cause of death.The researchers linked the poisoning to the widespread use of OP pesticides by farmers in the country amid limited knowledge of how to use the pesticides safely.

“Uganda has an agricultural-based economy with widespread use of organophosphate-based pesticides. This elevates the risk for OP poisoning in the population,” the report reads further.According to the report, the overall average incidence was 15 organophosphate admissions per 100,000 persons.

On areas, sex and age that are most affected, the report indicates, “residents of Ankole Sub-region were more affected while those in Lango Sub-region were least affected.”“Males had a higher incidence of organophosphate poisoning than females. Children under 5 years had a higher incidence than persons above 5 years (20 vs 14/100,000),” the report said.

Overall, 1,599 (average of 267 per year) deaths were reported between 2017 and 2022. Residents in Kampala had the highest overall case fatality rate (CFR) while those in Teso had the lowest (CFR: 8.5 percent vs 2.2 percent),” the report reads.

According to the report released yesterday, “there was more than 3-fold decline in incidence of OP poisoning admissions per 100,000 population from 2017-2022,” however, the researchers noted, “there was no significant change in the case fatality rate of organophosphate poisoning.”

“The incidence of organophosphate poisoning admissions declined throughout the study period. Since 2014, Uganda has implemented periodic public awareness campaigns about safe use of pesticides for small-holder farmers and pesticide dealers,” the report says.

“These campaigns have included sensitisation about responsible handling to reduce risk of poisoning and environmental pollution.

Additional campaigns targeting government pesticide regulators, non-governmental organisations, and media have also been implemented to address the dangers of organophosphate poisoning,” it adds.

The report says Uganda has also implemented the Agricultural Chemical Control Act to use less toxic pesticides, which may be contributing to the reduction in organophosphate poisonings.“To continue this decline, it is important to monitor and strengthen these interventions,” the researchers from UNIPH and Health ministry recommended.

Source: Daily Monitor Via msn.com

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DEFENDING LAND AND ENVIRONMENTAL RIGHTS

Statement: The Energy Sector Strategy 2024–2028 Must Mark the End of the EBRD’s Support to Fossil Fuels

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The European Bank for Reconstruction and Development (EBRD) is due to publish a new Energy Sector Strategy before the end of 2023. A total of 130 civil society organizations from over 40 countries have released a statement calling on the EBRD to end finance for all fossil fuels, including gas.

From 2018 to 2021, the EBRD invested EUR 2.9 billion in the fossil energy sector, with the majority of this support going to gas. This makes it the third biggest funder of fossil fuels among all multilateral development banks, behind the World Bank Group and the Islamic Development Bank.

The EBRD has already excluded coal and upstream oil and gas fields from its financing. The draft Energy Sector Strategy further excludes oil transportation and oil-fired electricity generation. However, the draft strategy would continue to allow some investment in new fossil gas pipelines and other transportation infrastructure, as well as gas power generation and heating.

In the statement, the civil society organizations point out that any new support to gas risks locking in outdated energy infrastructure in places that need investments in clean energy the most. At the same time, they highlight, ending support to fossil gas is necessary, not only for climate security, but also for ensuring energy security, since continued investment in gas exposes countries of operation to high and volatile energy prices that can have a severe impact on their ability to reach development targets. Moreover, they underscore that supporting new gas transportation infrastructure is not a solution to the current energy crisis, given that new infrastructure would not come online for several years, well after the crisis has passed.

The signatories of the statement call on the EBRD to amend the Energy Sector Strategy to

  • fully exclude new investments in midstream and downstream gas projects;
  • avoid loopholes involving the use of unproven or uneconomic technologies, as well as aspirational but meaningless mitigation measures such as “CCS-readiness”; and
  • strengthen the requirements for financial intermediaries where the intended nature of the sub-transactions is not known to exclude fossil fuel finance across the entire value chain.

Source: iisd.org

Download the statement: https://www.iisd.org/system/files/2023-09/ngo-statement-on-energy-sector-strategy-2024-2028.pdf

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FARM NEWS

Kigezi In Famine Scare After Drought Hits The Region

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Farmers in Rubanda district are living in fear that they may be hit by famine due to the prolonged drought that has greatly affected the area. This comes after the area was hit by heavy rains in the month of May 2023, which left most of the gardens washed away, and since then the dry season has started up to date.

This is the first of its kind for Rubanda district and Kigezi at large to undergo such a prolonged drought.

According to farmers, this is the first of its kind for Rubanda to go through a long drought, adding that they are in fear that they may be hit by famine since they were used to receiving rains at the beginning of August, which is not the case this year. They add that even the seedlings that they had planted excepting that the rains would come have all dried up by the long spell.

Farmers also say that they don’t know what could be the cause that has stopped the rains,adding that the government should come up with a program that provides them with seedlings.

Akampurira Prossy Mbabazi, a woman Member of Parliament for Rubanda District, says that the issue of drought is not only in Rubanda District; however, this is the first of its kind. She adds that the drought comes after the area was hit by heavy rains, which caused a lot of challenges, adding that now it is the drought that may affect the farmers.

Akampurira further says that, as a leader,she will continue to educate farmers on better methods of farming depending on climate change.

Kikafunda Evelyne, founder of Green Environment Promotion (GEP), says it’s sad that farmers in Rubanda district and Kigezi at large are experiencing a long drought. She attributes it to problems of environmental degradation that include swamps being reclaimed, deforestation, and plastic pollution, adding that this is an indication that people don’t mind about the environment.

Kikafunda calls upon all people to take part in protecting the environment, adding that environmentalists should devise means on how to protect the environment.

It’s now been four months since it last rained in the districts of greater Kabale, that is, Rubanda, Kabale, and Rukiga districts, as well as other parts of the Kigezi Subregion.

Source: chimpreports.com

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