Arnon Dror | Colombian Coffee Rust
Arnon Dror Explains How Colombia’s Coffee Industry Survived the Coffee Rust Pandemic
Worth about $2.5 Billion, Colombia’s Coffee and Spice industry is second only to its Oil and Mineral Fuels in terms of the country’s top global exports. However, regaining this status has been an uphill battle ever since the introduction of the Coffee Rust pandemic in South America. Arnon Dror tells the story of how the country’s coffee industry bounced back where so many others had failed, and how it was able to do so in such a short time.
While Colombia, Arnon Dror says, is technically the world’s third largest coffee bean producer after Brazil and Vietnam, it’s important to note that the country’s particular strain Arabica known as Colombia Supremo is considered by the world’s top connoisseurs to be far superior to the Robusta coffee beans of Brazil and Vietnam. The latter finds its biggest customers in producers of instant coffee and coffee flavorings. Image Source: LatinAmericaHeralTribune
The Columbia Supremo shares this distinction with slightly different strains of Arabica from smaller producers like Ethiopian Sidamo, Guatemalan Antigua and Jamaican Blue Mountain, and among its peers, Colombia’s farmers produce the most volume by far.
This is why the world of coffee was horrified when reports started coming out in the mid 2000’s about the spread of a new disease called “La Roya” or Coffee Rust, which had been exacerbated by the effects of climate change. The persistent and contagious spore caused coffee trees to shed their leaves and stop producing their coveted cherries permanently. By 2008, Coffee Rust had spread throughout Latin America.
Fortunately, Colombia’s forward thinking National Coffee Federation or Federación Nacional de Cafeteros de Colombia (FNC) was ready with a brand new variety of rust-resistant seeds to give to its affected farmers. To date, 45% of the country’s 940,000 hectares of coffee farms have been replanted with the new seed, allowing their coffee bean industry to recover most of its prominence. From a low of 8.5 million 60kg bags of coffee exported in 2008, the country produced 14.5 million bags last year.
Since coffee trees typically take three years to become productive, time was of the essence in aiding Colombia’s farmers. The FNC also provides technical assistance to farmers, assigning technicians to personally visit growers and advise them on best practices.
Arnon Dror sees the FNC as the key to the Colombian coffee industry’s success. Honduras, now one of the world’s top coffee producing countries, also managed to bounce back using Colombia’s model. However, unlike Honduras and Columbia, El Salvador’s central coffee authority was disorganized and ineffective while countries like Guatemala that do not have a centralized authority have been unable to recover from the spread of coffee rust as of yet.
The story of Colombia’s coffee industry is just once instance in a plethora of similar scenarios where national organization and development saved the day. Despite the attractiveness of fast-growing industries in emerging markets, Coffee Rust and the inability to deal with it is a prime example of the risks involved and Arnon Dror advises caution when investing in insecure markets marred with corruption and/or political unrest.