- Brazil’s Cooxupe Cooperative defines a smallholder coffee farmer as producing 500 to 2000 bags of coffee annually
- For smallholders in most other coffee-producing regions, these are unreachable volumes
- A “coffee smallholder” has become highly marketable, and ambiguity surrounding the term leaves it open to exploitation
IN THE specialty coffee sector, the term “smallholder” is frequently used, often with a sense of value attached to it. But what does it actually mean?
A widely accepted definition is anyone who farms an area smaller than five hectares. This accounts for 95% of the world’s 12.5 million coffee farms which contribute 67% of global production.
But definitions based on farm size vary from region to region, and it’s important to note the overwhelming discrepancies between what qualifies as a smallholder in different producing countries.
For example, coffee farms larger than 20 hectares are considered “large” in all countries except Brazil – where a smallholding, a mid-sized, and a large coffee farm are all larger than the global average.
In contrast, coffee farming in Africa is generally much smaller in scale and far more fragmented. As such, what is considered a “small” farm in Brazil could even surpass the size of a “large” farm in most African countries.
However, others define “smallholder” slightly differently. Ritesh Doshi, owner and CEO of Spring Valley Coffee, understands them to be farmers who are part of a cooperative or a producers’ group because they lack the resources to take the next steps along the value chain themselves. “The medium-sized farms or larger estates process everything end-to-end themselves,” he says. “They may do it for their neighbours as well.”
“Family farm ownership and management and the inability to hire labour or process their coffee themselves are clear indicators of being a smallholder for me,” says Gilbert Gatali, executive director and CEO of the Africa Fine Coffees Association.
Support vs isolation
Again, Brazil operates on another level to other producing countries – where smallholders often benefit from good access to cooperatives and state assistance which provide crucial support with agricultural input costs and market entry.
“In some Latin American countries, a smallholder will usually have access to a small hand-held pulper, dry mill, or access to his/ her own parchment,” says Gilbert. “This means they can move higher into the value chain because of this greater ownership.”
On the other hand, African smallholders can be relatively isolated. If they do have a cooperative network, they tend to be smaller, less organised, and less impactful compared to those in Brazil. This means they often lack post-harvest processing capacity, which hinders their ability to move further along the value chain.
Furthermore, African smallholders often struggle to access working capital through banks or more formal means. In many cases, they resort to another value chain stakeholder, where access to finance can come with high interest rates.
“In Brazil, they’re probably accessing working capital more easily, doing more processing and operating more like a business,” says Gilbert. This structure lowers their level of risk and makes them more resilient against economic downturns. In contrast, their African counterparts remain in a state of survival from harvest to harvest.
And it is a matter of survival. Many of the 5.5 million smallholders live below the international poverty line of $3.20 a day, with the most severe poverty occurring in Africa and Oceania. As such, smallholders from these regions tend to grow a variety of crops, driven by the necessity to prioritise subsistence farming for food security.
This essentially means they aren’t able to make the most profitable use of their land – a limitation that farmers from wealthier producing countries in less isolated circumstances don’t have to manage.
Ritesh is based in Kenya. For him, access to infrastructure tips the balance. “You may have smallholders in Brazil, but they have roads in good condition,” he says. “In Kenya, the roads are bad – coffee is carried by donkey or on farmers’ backs. It’s hard to get it from place to place.”
Ultimately, the experience of being a smallholder coffee farmer entirely depends on geographical and socioeconomic contexts. Despite this, the term “smallholder” continues to be used indiscriminately across the industry.
Marketing “the smallholder”
In the coffee sector, the “smallholder” label is often seen as a competitive asset. But is it fair to market a 5-hectare farm in Brazil which has access to finance, resources, and adequate infrastructure in the same way as a 1-hectare farm in Kenya that doesn’t?
For the larger smallholders, they are able to benefit from the label without facing the challenges that give it such power in the marketplace.
And for coffee roasters, the term “smallholder” has become highly marketable. “For lack of a better word, it’s not as sexy to say it’s from an estate than to say it’s from smallholders,” says Gilbert. “But in this way, their dignity is almost being taken away from them, especially as they play such a pivotal role in the global coffee industry.”
But ambiguity surrounding the term leaves it open to be misused and exploited – which has a direct impact on genuinely vulnerable smallholder farmers.
“You’re playing with what the idea of a smallholder is to justify the premium – because it’s rare and unique,” says Gilbert. “But there’s a need to question what we mean by smallholder farmer.”
“Who are they? Where are they? How many are there? How big is their farm? I think pushing these questions is the only way to start giving value to the word ‘smallholder farmer’, and reward it accordingly,” he says.
In many instances, the term is introduced by a supply chain entity other than the farmer or the roaster – such as an importer, exporter, or some form of producer network. For example, Cooxupe Cooperative in Brazil represents over 13,000 producers. The majority of the coffee they received in 2021 came from family farms (40%) and smallholders (34%) – but they qualify smallholders as being farms that produce anywhere between 500 and 2000 bags of coffee – astronomical amounts compared to outputs in other parts of the coffee-producing world.
Regardless of who instigates the term, applying a one-size-fits-all approach has the potential to exacerbate existing inequities between farmers who are vulnerable, and others with greater access to opportunities and support – both of whom are categorised as “smallholders”.
Being more considerate of a farmers’ context, fostering more curiosity across the supply chain, and holding buyers accountable for using and marketing the “smallholder” label could help to level the playing field.
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