Multinationals lead push for sustainable coffee in Vietnam

Multinationals lead push for sustainable coffee in Vietnam

Vietnam hopes to prove that sustainable farming practices aren't just good for the environment, they're also good for business. Photo: <a href="">Mike Rowe (Flickr)</a>
Vietnam hopes to prove that sustainable farming practices aren't just good for the environment, they're also good for business. Photo: Mike Rowe (Flickr)

Sure, sustainable farming is good for the environment. But as more and more companies are realizing, it can be good for business as well.

Case in point: Vietnam, where multinational corporations have begun a drive to improve the sustainability of the country's coffee sector.

Vietnam is the world's second-largest exporter of coffee, after Brazil, and the No. 1 exporter of robusta beans, which are typically used in instant coffee. With global demand for coffee rising, the supply of Vietnamese coffee is being threatened by unsustainable farming practices.

But as the Guardian's Poverty Matters Blog reported Monday, a coalition of conservation groups, the Vietnamese government and multinational food processors Kraft Foods and Nestlé are working together to ensure the future supply of Vietnamese coffee by making coffee farms more environmentally friendly.

Vietnamese coffee is crucial to the supply chains of multinationals like Kraft and Nestlé, so the companies are investing in spreading sustainable practices across Vietnam's coffee-producing regions. The reason is twofold: Western consumers are demanding more sustainable products, and food processors are looking to secure long-term access to high-quality inputs for their supply chains. Therefore, with a few targeted investments in farmer practices, companies can reap big rewards later on. Such practices include reducing water usage, planting trees, improving soil quality by planting coffee alongside other crops, such as sugarcane, and protecting local wildlife.

Currently, only 10 percent of Vietnamese coffee is grown sustainably—compared with 75 percent in Latin America. The result has been deforestation, soil degradation and a decline in the quality of coffee harvests. But with food companies like Kraft committing themselves to purchasing more of their coffee from sustainable sources, the Vietnamese government is aiming to increase sustainable production to 25 percent in the next three years.

Coffee represents 3 percent of Vietnam's GDP and provides a livelihood to approximately 2.6 million farmers, most of whom grow their crops on less than five acres. While these farmers may not have the means to change on their own, investments by companies further up in the supply chain can help them to make the shift to more sustainable agriculture. For farmers who successfully adopt sustainable practices, certification by organizations such as the Rainforest Alliance also allow them to increase the price they receive for their coffee.

Improving the sustainability of coffee production promises to preserve the environment, protect the livelihoods of Vietnamese farmers and ensure a steady supply of coffee for world's food processors. Now that's what you call a win-win-win situation.

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