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Burning coffee sacks

Desperate farmers protest against Nestlé's low purchase prices

The Nescafé Plan has been promising coffee producers more income and a better life since 2010, including in Mexico. But our field research in the state of Chiapas shows that farming families involved in this sustainability project are not making ends meet and feel cheated by Nestlé. Their main complaint is that the Swiss industry leader has been paying prices that barely cover their production costs for years. This is why Nescafé bags are now burning in the Soconusco coffee region

For over ten years, Nestlé has been urging farmers in Chiapas to switch to growing Robusta coffee, which fetches lower prices on the world market than the Arabica traditionally grown there, but which the company needs for the production of its Nescafé instant coffee: in 2022, Nestlé opened a new Nescafé factory in Mexico with an annual capacity of 40,000 tons of green coffee. When Public Eye in February 2024 Researched on site farmers have just burned filled coffee bags with the words "Nescafé Plan" during protests in Tapachula. The "company without ethics" is impoverishing Chiapas, according to one of the banners. The raw material that Nestlé buys here is marketed as "responsibly" produced: farmers benefit from training and particularly high-yielding Robusta seedlings as part of the Nescafé Plan and thus achieve a higher standard of living, according to the promise from Switzerland.

At the same time, however, Nestlé is practising a ruthless purchasing policy: in this year's harvest season, the food company is paying prices that are below production costs and lower in real terms than a year earlier. This is despite the fact that the Robusta market price has risen by 50% in the same period and farmers are struggling with higher production costs. However, Nestlé has not yet complied with their demand for a minimum price that at least covers costs. This behavior illustrates the power asymmetry between the industry leader and its raw material suppliers. In a Petition the affected farming families are demanding that Nestlé finally pay them fairly. Almost half of all coffee farmers worldwide still live in poverty. Half of them even live in extreme poverty, i.e. on less than 1.90 US dollars a day. Public Eye has also observed this in Chiapas, where many smallholder families run out of money and therefore food just six months after the coffee harvest. The low price that farmers receive for their coffee is the main factor behind the widespread poverty, which leads to other problems such as child labor.

The right to a living income is an internationally recognized human right. In its "Living Income Action Plan", Nestlé pledges to promote this right with the Nescafé Plan. However, its price squeeze is fundamentally at odds with this commitment. The planned EU Corporate Responsibility Act, which is due to be passed this year, stipulates that companies must respect the right to a living income as part of their due diligence obligations. Switzerland must also close existing legal loopholes and ensure the introduction and effective enforcement of rules on respect for human and environmental rights by corporations

Oliver Classen, media spokesman, 044 277 79 06, oliver.classen@publiceye.ch

Carla Hoinkes, agricultural expert, 044 277 79 04, carla.hoinkes@publiceye.ch