Leveraging the Market for a Sustainable Coffee Economy

The document argues that sustainability in the coffee sector is hindered by market volatility, systemic poverty, and environmental degradation. It suggests that the ICO should leverage the renegotiation of the International Coffee Agreement to implement participatory governance, improve information sharing for differentiated coffee markets, and establish coordinated funding and risk management mechanisms for producers.

• The Private Sector Consultative Board (PSCB) currently lacks sufficient representation for smallholder producers, as membership has been "limited primarily to major coffee associations and institutions". The author proposes expanding exporting country representation from eight to 12 to include representatives specifically for smallholder producers.
• To address the lack of clarity regarding the relationship between government policy and multi-stakeholder sustainability initiatives, the ICO could establish a formal "Consultative Board on Sustainability" to build shared global approaches.
• The ICO is encouraged to create a Web-based "coffee observatory" to provide aggregate price data for differentiated coffees based on quality and geographic sustainability, which would help farmers develop sustainable production strategies.
• Coffee producers require technical assistance in five key areas: management and marketing for sustainability/quality, diversified livelihoods, strengthening producer organizations, access to credit, and access to risk management tools.
• The document proposes three mechanisms to support producers: a "clearing house" to coordinate technical assistance projects, a "Partnership Fund for Sustainability" for coordinated funding, and a "financial services information access point" to help small producers access credit for differentiated markets.
• Because risk management tools like "put options" and hedges are largely unavailable to producers due to lack of capital and infrastructure, the ICO should facilitate a "risk management facility" to improve producer sustainability against market volatility.
• To internalize the social and environmental costs of production, the ICO could adopt policy measures such as preferential export/import conditions, preferential sales and services taxes, income tax credits, or set premium schedules for recognized sustainable coffees on commodity exchanges.

APA

Potts, J. (2006). Leveraging the Market for a Sustainable Coffee Economy. International Institute for Sustainable Development. https://www.iisd.org/system/files/publications/coffee_leveraging_market.pdf

Chicago

Potts, Jason. Leveraging the Market for a Sustainable Coffee Economy. International Institute for Sustainable Development, 2006. https://www.iisd.org/system/files/publications/coffee_leveraging_market.pdf.

Wikipedia

{{cite report |last1=Potts |first1=Jason |title=Leveraging the Market for a Sustainable Coffee Economy |publisher=International Institute for Sustainable Development |date=May 2006 |url=https://www.iisd.org/system/files/publications/coffee_leveraging_market.pdf |access-date=17 August 2026 |via=Climate Insights Directory}}

BibTeX

@techreport{potts2006leveraging, author = {Potts, Jason}, title = {{Leveraging the Market for a Sustainable Coffee Economy}}, institution = {International Institute for Sustainable Development}, year = {2006}, month = may, url = {https://www.iisd.org/system/files/publications/coffee_leveraging_market.pdf}, urldate = {2026-08-17}, note = {Indexed by Climate Insights Directory} }