Brazil’s Coffee Growers Struggle with Labor Shortage as Virus Spreads
Tue, April 20, 2021

Brazil’s Coffee Growers Struggle with Labor Shortage as Virus Spreads

 

Brazil is a coffee giant as it produces more than 40% of the world’s coffee. / Photo by futuristman via Shutterstock

 

Brazil is a coffee giant as it produces more than 40% of the world’s coffee. It is the world’s leading exporter and grower of coffee beans, most of these are lower grade robusta and arabica. However, with less than a month before the country’s coffee harvest, growers are now worried that they may not have enough field hands to pick the crop as coronavirus spreads in the country.

 

Bracing shortage of coffee pickers

Farmer Paulo Lagazzi, as featured in Bloomberg, said he is worried that coffee beans may just fall from their trees and rot due to labor shortage. Without the pandemic, he could have negotiated with 40 to 50 seasonal coffee pickers from neighboring Bahia state or in Minas Gerais in southeastern Brazil. But since these are not normal times, considering the global lockdowns that impact the food supply chain, Lagazzi is now struggling with how to deal with the labor shortage.

The closed borders between municipalities and states mean that all or some of Lagazzi’s workers could not reach his 1,235-acre coffee plantation. Even if they do arrive as they seasonally do, the farmer would also have to consider their temporary shelter. He normally accommodates four workers per room but the social distancing measures force him to split these workers and consider the spaces of their beds in the room. If someone will get sick during the harvest season, what happens then? Lagazzi said he is not that prepared to handle the quarantine since these workers would also be moving around the farm.

Lagazzi’s concern is a problem that is playing out in Brazil as a country. Being the largest exporter and producer of coffee, most coffee beans are harvested mechanically but all robusta and a third of arabica have to be hand-picked. This is either because the machines cannot yet handle certain types of trees or they are growing on the mountainside. Brazil’s crop forecasting agency Conab shares that the country is set to produce 15 million bags of robusta and 44.6 million bags of arabica this year. Then, about two-thirds of these bags of coffee produced will be exported to other countries. Robusta is a bitter-tasting, high-caffeine bean while arabica is a higher-quality bean. A bag of coffee weighs 60 kilograms or 132 lbs.

 

Farmers are struggling to bring in migrant workers to help them on the farm due to the travel bans imposed. / Photo by Pete Burana via Shutterstock

 

Coffee bean production

Brazil produced 1.90 million tons of coffee beans in 2000 and 2.61 million tons in 2002. In 2004, its coffee bean production reached 2.47 million t, 2006 (2.57 million t), 2007 (2.25 million t), 2008 (2.80 million t), 2010 (2.91 million t), 2013 (2.96 million t), 2014 (2.80 million t), 2015 (2.65 million t), 2016 (3.02 million t), and 2019 (3.56 million t). This is according to the UN Food and Agriculture Organization.

The output of mild-tasting arabica beans, which is preferred by American coffee company Starbucks, has recently gained 12% from a mid-March low attributed by concerns on low supply in the country. Bloomberg further reports that any delay in the coffee harvesting could not just compromise the quality of beans but will also push coffee prices higher. The “main risk” in supply would be a shortage of labor. Farmers are struggling to bring in migrant workers to help them on the farm due to the travel bans imposed.

London-based multi-asset execution and liquidity provider Sucden Financial’s coffee broker Alex Boughton likened Brazil as a “ticking time bomb” as its President is still dismissing the seriousness of the coronavirus.

Brazil’s leader Jair Bolsonaro rejects the consensus of statisticians and scientists on the gravity of the outbreak. In his gut, he believes that the economic fallout will be a bigger threat compared to the virus itself.

In the state of Espirito Santo, where a majority of robusta beans are produced, harvesting usually begins mid-April and about 50,000 temporary farmworkers are hired. This year, growers are instructed to wait “a little longer” until the passage of government resolutions.

The Agriculture Ministry has already released few measures to make sure that food supplies in Brazil will not be disrupted during the lockdown and said that it is already working on recommendations that farmers can adopt should they need to hire temporary workers. The agency Covid-19 commission’s deputy coordinator Luiz Rangel also said that it may take about two weeks before the guidelines will be released for farmers although such rules will not be mandatory.

So, in the meantime, farmer Lagazzi is figuring out to make the most of his time while coffee pickers are not available. He thinks that any delay will cost money the moment he sells the crop. A week past the scheduled harvest start date (April 27) alone would already affect the quality of the coffee cherries as they become more vulnerable to rain and wind that can knock the fruits off the tree. If such continues by the end of the month, there would already be a “severe” loss of coffee quality.

Lagazzi went on to say that he is now spending on new measures to clean the farm and is prepared to spend more on fuel to transport fewer pickers for every trip. Even so, he is still not sure if all his efforts would be enough.

 

 

Coffee exports, by country

According to trade metrics platform World's Top Exports, the top countries that exported the highest dollar value worth of coffee in 2018 are Brazil: $4.4 billion (14.1% of total coffee exports), Vietnam: $3.3 billion (10.5%), Germany: $2.5 billion (8.2%), Switzerland: $2.4 billion (7.6%), Colombia: $2.3 billion (7.5%), Italy: $1.7 billion (5.4%), France: $1.2 billion (3.7%), Honduras: $1.1 billion (3.6%), Belgium: $867.9 million (2.8%), and United States: $861.2 million (2.8%).

Boughton opined that logistical delays may worsen as Brazil is struggling to deal with the increasing viral growth curve. On the other hand, having a flat curve means a slow infection rate, which also means the healthcare system is in a better position to treat people and save lives.

As coffee plantations in Brazil cover immense areas of land, it needs hundreds of people to operate and manage them to produce large quantities of coffee. This is why it will be a challenge not just for the agriculture community but the country as a whole due to Covid-19.