Starbucks Responds to Climate Change, with Mixed Results
Starbucks’s efforts to head off climate change and its impact on coffee bend to business realities.
If temperatures warm at expected rates, 80 percent of land in parts of Brazil and Central America currently used to grow the most popular type of coffee, Arabica, will become unsuitable to the crop by 2050, according to research by the International Center for Tropical Agriculture. Globally a 50 percent decline is predicted over the same period. The most likely outcome would be a drop in quantity and a rise in prices.
In addition to devastating farming communities dependent on the crop, coffee buyers could very well be forced to build a new roster of bean suppliers and establish new supply routes, an expensive and complicated shift. “Your supply of coffee as you know it is definitely at risk,” says Bambi Semroc, who works on coffee and climate change issues at the Center for Environmental Leadership in Business at Conservation International.
This is why one of the companies most worried about climate change is Starbucks, which is the largest seller of coffee worldwide. Starbucks has responded both by working with farmers to improve their ability to grow coffee in a warming climate and by trying to reduce the company’s own environmental impact. The farming efforts are progressing but are far from a broad fix. The attempts to reduce Starbucks’s overall greenhouse gas emissions have run into even more trouble.
For over a decade, the company has cultivated a network of farmers around the world who grow their beans under a set of standards that include using shade and tree conservation to protect crops, and managing risks from pests and disease spurred by changes in the climate. Today 99 percent of its coffee, more than 400 million pounds each year, complies with those standards, the company reports.
In 2013 Starbucks even bought its own coffee farm in Costa Rica and turned it into a laboratory for testing coffee-growing practices and developing plants that can thrive in warmer temperatures.
Coffee’s growing region stretches like a belt around the equator, through more than 50 countries including Vietnam, Indonesia, Brazil, and Tanzania. Rising average temperatures in many of these countries have already begun to shrink coffee farmers’ yields. Leaf rust and other damaging diseases have also come to coffee farms that didn’t suffer from them historically as their climates have shifted, severely damaging crops.
Some of the coffee experimentation may be bearing fruit, though not yet at the large scale Starbucks would need. In an early experiment, in 2014, the company sold a small batch—only 170 bags—of a coffee varietal it developed with a Costa Rica cooperative that is more resistant to fungal infestation, but is also slower-growing and lower-yielding.
That same year, after the farmers in Chiapas, Mexico, lost 60 percent of their coffee production to leaf rust following increasing temperature and rain, Starbucks Mexico began to distribute coffee plants bred to be rust-resistant in the area. By the end of next year Starbucks will have donated 20 million of the seedlings to farmers affected by the fungus. It openly shares its formula for breeding the plants.
The company is also hoping that by offering financial support and advice to farmers on how they can increase their productivity by better pruning their existing trees or replacing ones, they can help them succeed in a more difficult environment.
Reducing its own carbon emissions seems to have been even more challenging. In 2008 the company set an ambitious goal of reducing its energy use by 25 percent in its company-owned stores, but after some early success, emissions began to increase in recent years, rising from just over one million metric tons in 2012 to 1,258,092 metric tons in 2014, mainly from energy used in its stores, offices, and roasting plants.
One reason is the company’s decision to add heated food to the menu. This requires more refrigeration and ovens, and more energy. Though it has hampered Starbucks's long-term environmental goals, the company says it is working on improving oven efficiency, and investors love the strategy, which has helped profits increase substantially.