San José, Costa Rica, since 1956

Coffee Industry Struggles in Today’s Economy

The tiny neighboring coffee towns Santa María de Dota and San Marcos de Tarrazú rest in adjacent green valleys like two tired old buddies slung in hammocks after an honest day’s work.

Somewhere between them, off the winding road’s shoulder, children laugh in the coffee fields below.

Two pairs of eyes poke out from behind rows of green leaves and plump sacks of redripe coffee beans.

Though they’re shy and silent, their dirtstained clothes and hands speak for the fact that they’ve been playing in the fertile soil.

Hunched over a basket of beans nearby is their father, José Martínez. Each year around November,Martínez brings his wife and two children south across the Costa Rican border illegally. Leaving behind their home in northern Nicaragua, where they make a living harvesting corn, they swim across the San Juan River just in time for Costa Rica’s coffee harvest season.

The kids, José and Jailin, aren’t quite old enough to pick coffee. But they will be soon. A few rows of coffee away,Nicaraguan brothers Sandy and Walter Villalta, ages 9 and 14, are picking away.

Martínez makes about $15 per 12-hour day, earning about ¢600 ($1.16) per basket he fills with beans, a standard measurement known as a cajuela.

“Pura vida,” Martínez says, smiling as he shows off the Tico language he’s picked up. Of the estimated 200,000 workers who pick Costa Rican coffee during the harvest season, 60-80% are Nicaraguans and indigenous Panamanian migrant workers, according to estimates from the Labor Ministry and the National Coffee Institute (ICAFE).

It’s not uncommon for foreign coffee pickers like Martínez, who are increasingly becoming the backbone of the $231 million coffee industry, to undergo exhaustive journeys, pounding heat and meager living conditions – among other work hazards – to come here and make a few bucks a day.

Among the latest tragedies in the industry is the death of a 7-year-old coffee picker who was thrown from the back of the pick-up truck in which he and others were riding when it ran off the road and smashed into a rock. Eight others were sent to the hospital after the accident earlier this month. In November, a truck loaded with 19 Nicaraguan coffee pickers fell off a 200-meter cliff in San Marcos, killing four and injuring the rest.

Illegally packing coffee workers into the back of pick-ups is the preferred mode of transporting labor in the industry.

As Costa Rica continues opening up to the world market, it’s not just importing servicesector jobs that are being outsourced by U.S. companies like Intel and Hewlett Packard.

The country is also importing laborers to work in the agricultural sector harvesting crops like coffee, pineapples and sugarcane – jobs that Ticos are becoming increasingly more reluctant to take on.

“Without foreigners, the coffee doesn’t get picked,” said the earth-caked Miguel Badilla, one of 750 producers who make up the local cooperative Coopedota in Santa María de Dota. The town is part of the Los Santos coffee region in the mountains south of San José, where about 15,000 producers have long struggled to find enough hands during the harvest.

In this town, every third bean picked will ultimately be sold in Starbucks chains across the United States, Europe and other developed economies, where a drink can cost as much as a worker’s daily income here.

A Vital Industry

Few things are as Costa Rican as making coffee.

As the country’s economy diversifies and changes, many have their eye on the industry, which has close ties to the nation’s history and the structure of its society, analysts say.

“Coffee is an essential piece of Costa Rican history. From the 19th century on, it had become the country’s economic staple.

Though it is now being overshadowed by other industries, it continues to be a definitive part of national life,” said Jaime Darenblum, Hudson Institute Fellow and former Costa Rican Ambassador to the United States.

The product that was once the nation’s prime export has now fallen behind microprocessors, bananas, pineapples and medical equipment, representing only 2.8% of the nation’s exports in 2006.

Political analyst Constantino Urcuyo said Tico society has been undergoing a crucial transformation ever since coffee price crises in the 1980s prompted the country to diversify its economy.

“With coffee, Costa Rica was basically a rural country … In the 1980s, (the country) realized it couldn’t just survive off of coffee. The process (of economic diversification) has been successful, but it has created inequalities amid economic growth,” he said.

Urcuyo said this transformation is key in understanding why inequalities have been growing in Costa Rica, and why Costa Rica’s bipartisan political system has been “ruptured” in recent years with the birth of the Citizen Action Party and other smaller parties (TT, Nov. 3, 2006, Jan. 5).

The changes in the coffee sector have been key in changing Costa Rican politics and civil society because coffee was essential in laying the foundation for Costa Rica’s democracy, he said. Profit-sharing cooperatives, which gained power for small producers throughout the 20th century, were key in distributing wealth equitably in Costa Rica.

The cultivation of coffee was based on a paternalistic, hierarchical system rooted around the plantation and in which there was one prime export. The diversification of the economy has blown that system to pieces, according to Urcuyo.

Now, no sector claims more than 15% of exports in Costa Rica and civil society has been “leveled.”

“All the problems the country is having surrounding the Central American Free-Trade Agreement with the United States (CAFTA) is a reflection of that reformation that society has seen,” he added.

Coffee and Change

Today, Costa Rica’s coffee industry is still bouncing back from a 1999 price collapse due to overproduction in booming industries in Vietnam and Brazil, which have advantages of economies of scale and cheaper labor, according to ICAFE Executive Director Adolfo Lizano.

Since the price crisis, Costa Rican industry leaders have, instead of trying to be mass producers, set their eyes on quality.

“What we realized 15 years ago is that we have to start to sell this stuff… now we have to learn about Internet marketing,” said Café Britt founder and president Steve Aronson.

Darenblum said information and technology will determine economic success in the global market.

Economic diversification before the global market has brought change to the coffee industry itself.

For instance, Coopedota president Roberto Mata rides around the region’s hilly edges in his shiny Toyota Landcruiser.

Fifty years ago, there were no cars here, he said.

Runaway ox-driven carretas on the valley’s steep walls – which reach 7,000 meters above sea level – were part of the job description for coffee pickers here.

“Coming down this road with oxen was pretty much suicide,” he said, driving down a slope fit for skiing.

As the president of the cooperative that provides 90% of the valley’s income, Mata holds status as a sort of mayor.

“In reality, I’m almost like a public figure,” said Mata, one of 3,500 residents in the town.

For this little town, coffee has always been the only industry. Though there are now some efforts to attract tourists for agricultural tourism, coffee is virtually the only employer in a town where colorful oxcarts still stroll through the city’s center.

The region has survived the industry’s giant changes in the last half-century. In southern Costa Rica many coffee plantations have been converted to pineapple farms, while urban sprawl in the Central Valley has replaced coffee plantations in places such as Heredia.

“Have you been to Heredia? There’s a Hipermas, houses, electronics companies, tourism operators, and offshore manufacturers.

Thirty years ago that was all coffee fincas,” Aronson said.

President Oscar Arias’ family used to own vast coffee plantations in Heredia, some of which are now being used for other purposes.

Unskilled Workers Needed

Urbanization isn’t the industry’s only challenge. Mata said Los Santos is a region notorious for its shortage of workers.

As Costa Rica’s economy diversifies, more Costa Ricans are looking for more stable jobs with higher salaries, Urcuyo said.

Mata estimated in the Los Santos region, a third of the workers are indigenous Panamanians, and another third are Nicaraguans.

Most Panamanians and many Nicaraguans who work in the agricultural sector are undocumented, according to Johnny Ruiz, migrant work director at the Labor Ministry.

“To document that population (of foreign workers) has been difficult,” he said, adding the only documentation the government has are lists employers send to the ministry. Indigenous Panamanians – many who speak little Spanish and migrate along historic routes to and from Costa Rica – face the largest obstacles in finding a living wage and reasonable living conditions in Costa Rica, he said.

Instead of focusing its efforts on regulating the legality of workers’ immigration status, Ruiz said the Labor Ministry is pushing to make sure the workers have adequate working conditions.

“We believe Costa Rica needs temporary workers,” he said. The ministry is working on a proposal to have employers pitch in for a collective health insurance policy for workers. The health ministry’s mobile units have long given services to agricultural workers.

Ruiz acknowledged many employers don’t provide workers with adequate pay and living conditions the law requires.

For example, by picking more coffee and making a higher wage, Martínez, from Nicaragua, makes about three times as much daily as Ernesto Morales, an indigenous man from Panama who sleeps on the floor with his family of four in a cabin without locks.

The two men work side-by-side picking beans on the same plantation, working for the same boss.

Labor Ministry inspector Xinia Brenes said she wasn’t familiar with Morales’ case, but said it’s not uncommon for foremen to give different workers different pay, though by law they are supposed to give workers on the same plantation equal pay.

In Los Santos, which produces nearly a third of the country’s coffee, the ministry has five inspectors who “go plantation by plantation” looking for labor violations. They also work off of tips, she said.

Though Mata has felt the benefits of the changing economy, it is harder to sense the change in the coffee fields beyond the fact that fewer workers are Costa Rican.

With swollen, soil-stained digits,Morales plucked the bean from the plant and let it drop into the basket strapped around his waist.

In his broken Spanish, the Guaymí native from west Panamá said he came with his spouse and two kids on a 12-hour bus ride from Panama for the harvest season.

“They could afford to pay us more,” said Morales, 27, who makes just above the legal minimum wage of ¢492 ($0.95) per cajuela.

Tico Times reporter Katherine Stanley contributed to this article.


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