What a Guatemalan Coffee Farmer Earns

The gap between what a Guatemalan coffee farmer earns for their crop and what a company like Starbucks pays for that same coffee can be pretty eye-opening.

Here’s a breakdown to help you understand:

1. What a Guatemalan Coffee Farmer Earns

Coffee farmers in Guatemala typically sell their beans at prices determined by global coffee markets, which can be volatile. Many farmers grow Arabica coffee, known for its high quality, but even so, they often face challenges such as low market prices, rising production costs, and changing climate conditions.

  • Market Prices: Coffee prices on the commodity market (set by the New York Coffee Exchange) fluctuate. As of recent years, the price has ranged from $1.00 to $2.00 per pound of green coffee beans, though it can go higher for specialty coffee.
  • Fair Trade or Direct Trade Premiums: Some Guatemalan farmers participate in Fair Trade or Direct Trade programs, which can ensure they receive a slightly higher price, sometimes around $1.50 to $2.50 per pound or more, depending on the quality and certifications. However, only a fraction of coffee farmers benefit from these programs.
  • Production Costs: For a Guatemalan farmer, the cost of production (labor, fertilizers, water, land maintenance, etc.) can take a significant chunk of their income. Estimates suggest that growing one pound of coffee can cost around $0.80 to $1.20 per pound, depending on the farm’s size and efficiency.
  • Profit Margin: With those costs factored in, the net profit a farmer makes can be just a few cents per pound of coffee. Many small-scale farmers may earn less than $500 to $2,000 annually from their coffee crop, depending on the size of their farm and market conditions.

2. What Starbucks Pays for Guatemal Coffee

Starbucks, like many large coffee companies, often sources its coffee through direct contracts with producers, cooperatives, or exporters. Starbucks claims to pay above the average commodity market price, but the details of these payments vary by region and quality. Here’s what we know:

  • Average Purchase Price: Starbucks has reported paying an average of $1.20 to $2.00 per pound for green coffee beans, sometimes more for premium or specialty grades.
  • Premium Coffees: For high-quality coffee beans, Starbucks may pay more through its C.A.F.E. (Coffee and Farmer Equity) Practices program. They report paying an average of $1.60 per pound under this initiative, which is above the Fair Trade minimum. Some specialty lots may fetch even higher prices, but this is rare.

3. The Retail Price at Starbucks

  • Once Starbucks roasts and brews the coffee, the price skyrockets. For example, a 12-ounce cup of coffee at Starbucks typically costs around $3.00 to $5.00 in the U.S.
  • Assuming a pound of coffee can brew roughly 48 cups of coffee, Starbucks can make $144 to $240 from selling coffee brewed from just one pound of beans. Compare that to the $1.50 to $2.00 per pound that a farmer might receive—it’s a huge markup!

4. Why the Difference?

  • Supply Chain: The price a farmer gets is affected by many factors along the supply chain. After leaving the farm, the coffee beans go through middlemen, exporters, importers, roasters, and retailers—all of whom take a cut.
  • Branding and Value Addition: Starbucks adds a lot of value beyond the coffee itself: branding, roasting expertise, marketing, and the retail experience. That’s part of the reason why they can charge so much more for the same coffee.
  • Operational Costs: Starbucks has significant overhead costs for running its cafes—rent, labor, equipment, etc. These costs also contribute to the high retail price of the coffee.

5. The Profit Discrepancy

In summary, while a Guatemalan coffee farmer might earn $1.50 to $2.50 per pound of coffee, Starbucks can make over $100 selling that same coffee in brewed form. The disparity highlights the unequal distribution of profits in the coffee industry, with farmers often getting a very small share of the final retail price, despite doing the hardest work of growing and harvesting the coffee.

This profit gap is why there’s a push for more Direct Trade, Fair Trade, and sustainability initiatives, aiming to give farmers a fairer share of the revenue from their crops.

The process of getting coffee from the beautiful coffee farms of Guatemala to your cup is quite fascinating! Guatemala is known for producing some of the world’s finest coffee due to its rich volcanic soil, high altitudes, and perfect climate. Let me break down the journey of the coffee bean, from its harvest to that delicious cup of joe:

What a Guatemalan Coffee Farmer Earns

1. Growing the Coffee

  • Coffee cherries grow on coffee plants, which thrive in Guatemala’s mountainous regions, particularly between 1,200 and 1,800 meters above sea level.
  • The best-known varieties in Guatemala are Arabica, especially types like Bourbon and Caturra, prized for their bright acidity and complexity.

2. Harvesting the Cherries

  • Hand-picking: The cherries are harvested by hand, typically between November and April, when they are bright red and ripe. Picking by hand ensures that only the ripest cherries are selected, which contributes to the overall quality.
  • Selective picking: Farmers often pass through the same fields multiple times to make sure they only get fully ripe cherries.

3. Processing the Coffee Cherries

After harvesting, the cherries must be processed quickly to avoid spoilage. There are two main methods in Guatemala:

  • Washed (or Wet) Process:
    1. The cherries are pulped to remove the outer skin.
    2. The beans are fermented in water for 12–48 hours to remove the sticky mucilage layer.
    3. The beans are then washed and dried, either on raised beds or patios. This method gives Guatemalan coffee its clean, bright flavors.
  • Natural (or Dry) Process:
    1. The cherries are spread out in the sun to dry whole, without removing the pulp.
    2. Once fully dried, the beans are hulled to remove the outer layers. This process can impart a fruitier, more complex flavor to the beans.

4. Drying the Beans

  • Sun-drying: Coffee beans are spread out on patios or raised drying beds. Guatemalan farmers often turn the beans regularly to ensure even drying, which can take several days.
  • Mechanical drying: In cases where the weather doesn’t cooperate, farmers may use mechanical dryers to finish the process.

5. Hulling and Milling

  • After drying, the beans are passed through a hulling machine to remove the parchment-like layer surrounding the beans (if they were wet-processed).
  • The beans are then polished (optional) and sorted by size and weight to ensure uniformity.

6. Grading and Exporting

  • The beans are graded based on their quality, with top-tier Guatemalan coffee often labeled as “Strictly Hard Bean (SHB)” for its high altitude growth.
  • The beans are then packed into burlap sacks and shipped off to coffee roasters around the world.

7. Roasting

  • Once the beans arrive at their destination, they’re roasted to bring out their distinctive flavors. Roasting transforms the green beans into the aromatic brown beans we know as coffee.
  • The roast level (light, medium, dark) greatly affects the flavor profile. Guatemalan coffee tends to be roasted at a medium roast to highlight its balance of sweetness, acidity, and body.

8. Grinding and Brewing

  • Coffee is ground to a specific size depending on the brewing method (e.g., coarse for French press, fine for espresso).
  • Brewing methods vary from drip coffee makers to pour-over, French press, or espresso machines, but each method extracts the flavors locked in the beans differently.

When brewed properly, Guatemalan coffee often reveals a complex profile with bright acidity, fruity and floral notes, sometimes with a hint of chocolate or caramel, and a smooth body.

And that’s it! What a Guatemalan Coffee Farmer Earns

From the volcanic highlands of Guatemala to your cup, it’s a long journey that involves a lot of care and precision at every stage.

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