USAID, Keurig Green Mountain, Cooperative Coffees, Starbucks and Root Capital Launch $23 Million Resilience Fund to Help Farmers Fighting Coffee Rust Crisis

WASHINGTON, DC, June 19, 2014 — The U.S. Agency for International Development (USAID), in partnership with Keurig Green Mountain, Inc., Cooperative Coffees, Starbucks and Root Capital, today launched the Coffee Farmer Resilience Fund to leverage $23 million in financial assistance for more than 40,000 coffee farmers combatting the devastating coffee rust outbreak in Latin America and the Caribbean. Since 2012, coffee rust has affected more than two million people in Latin America, causing an estimated $1 billion in economic damages which could lead to 500,000 job losses.

"This dynamic partnership will leverage our joint expertise, along with that of the private sector, to help tens of thousands of rural farmers boost their incomes and rise out of poverty,” said USAID Administrator Dr. Rajiv Shah. “Through innovative approaches to farming, we can help these men and women combat the worst outbreak of coffee rust in Latin American history – and lay the foundation for broad-based economic growth for generations to come."

The Fund will:

• Leverage $8 million in funds from USAID and partners, including Keurig Green Mountain, Cooperative Coffees, and Root Capital, to provide on-farm, agronomic trainings on climate-smart, resilient practices to coffee farmers and farmer organizations in Mexico, Guatemala, Honduras, El Salvador, Nicaragua, and Peru.
• Unlock $15 million in investment capital from Root Capital, including $3 million in new investment from Starbucks, through a USAID credit enhancement for long-term financing for rehabilitation of disease-affected fields and short-term financing to stabilize coffee supply chains in Latin America and the Caribbean.
• Enable participating coffee roasters to negotiate the cost of combatting coffee rust into their purchase contracts with farmer organizations to ensure sustainable solutions rather than one-time charitable gifts. The pooled funds will provide technical assistance, leading to sustainable supply chains and increased farmer incomes in the short and long term.

Additional coffee buyers and roasters are expected to join the Fund over the next two growing seasons.

“Coffee leaf rust is a critical industry issue that requires a collective approach,” said Lindsey Bolger, vice president for coffee sourcing excellence at Keurig Green Mountain. “We are proud to partner with USAID, Root Capital, and fellow roasters on this expansion of the Coffee Farmer Resilience Initiative, which will unlock new resources for coffee farmers for agronomic training, rust prevention, and other resiliency investments that are necessary to combat this crisis affecting those growing the high-quality coffee our consumers enjoy.”

Overall, USAID is investing $18.5 million to combat coffee rust in Latin America and the Caribbean and leveraging a total of $26 million in private sector investment. This includes the recently announced partnership with the Norman Borlaug Institute for International Agriculture at Texas A&M University to support research that will help establish a more resilient and higher-quality regional coffee sector.

The new Fund builds off of Root Capital’s existing Coffee Farmer Resilience Initiative, which leverages funding from a variety of partners including the Inter-American Development Bank.

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Background for Reporters:

"The staff and members of Cooperative Coffees are thrilled to participate with USAID, Root Capital and Progresso Foundation to support grassroots farmers’ cooperatives responses to the Coffee Rust crisis," said Cooperative Coffees Executive Director Jonathan Rosenthal. "We see this kind of public/private global collaboration as an effective targeted response to a crisis that finances small scale farmers to use local approaches to confront difficult problems."

“The scourge of coffee leaf rust forces us to recognize that coffee may be the proverbial canary in the coalmine for climate change’s destructive impact on agriculture,” said Willy Foote, Root Capital founder and CEO. “Responding to complex issues in agriculture requires precompetitive, pathological collaboration among all partners in the supply chain – successfully doing so is good for farmers who depend on coffee for life, for companies that rely on high-quality coffee to sustain their businesses, and for consumers who are unwilling to witness the extinction of their morning Joe.”

“By working with other like-minded organizations such as USAID and Root Capital, we can we ensure positive impact and sustainable change at scale” said Craig Russell, executive vice president, Starbucks Global Coffee. “We are heavily invested in helping farmers manage through changes in weather or conditions like coffee rust and this new commitment of $3 million—as part of our broader $20 million farmer loan program—ensures that farmers will receive access to the resources and capital necessary to adapt to these uncertainties and secures the longevity of our industry’s supply chain.”

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The U.S. Agency for International Development is leading the U.S. Government's efforts to end extreme poverty and promote resilient, democratic societies.

Feed the Future is the U.S. Government’s global hunger and food security initiative. Through its leadership of the initiative, USAID is working closely with Latin American and Caribbean governments, international and regional organizations, civil society, coffee associations and the private sector to further mitigate the crisis, accelerate recovery, and enable future growth. More information: www.feedthefuture.gov.

USAID’s Development Credit Authority uses partial credit guarantees to mobilize local financing in developing countries. Guarantee agreements encourage private lenders to extend financing to underserved borrowers in new sectors and regions. By opening up local channels of financing, USAID is empowering entrepreneurs in developing countries at a minimal cost to the U.S. taxpayer.  More information: www.usaid.gov/DCA.

As a leader in specialty coffee, coffee makers, teas and other beverages, Keurig Green Mountain (Keurig), is recognized for its award-winning beverages, innovative brewing technology, and socially responsible business practices. The Company has inspired consumer passion for its products by revolutionizing beverage preparation at home and in the workplace. Keurig supports local and global communities by investing in sustainably-grown coffee and by its active involvement in a variety of social and environmental projects. By helping consumers drink for themselves, we believe we can brew a better world. More information: www.KeurigGreenMountain.com.

Cooperative Coffees is a green coffee importing cooperative, comprised of 23 community-based coffee roasters in the USA and Canada, committed to building and supporting fair and sustainable trade relationships for the benefit of farmers and their exporting cooperatives and communities. We strive to promote transparent and direct Fair Trade and sustainable alternatives in both the North and the South, while continuing to sell the highest quality coffee on the market. More information: http://coopcoffees.com/.

Since 1971, Starbucks Coffee Company has been committed to ethically sourcing and roasting high-quality arabica coffee. Today, with stores around the globe, the company is the premier roaster and retailer of specialty coffee in the world. Through our unwavering commitment to excellence and our guiding principles, we bring the unique Starbucks Experience to life for every customer through every cup. For more information on this news release, contact us.

Root Capital is a nonprofit agricultural lender that grows rural prosperity in poor, environmentally vulnerable places in Africa and Latin America by lending capital, delivering financial training, and strengthening market connections for small and growing agricultural businesses. Since 1999, Root Capital has disbursed more than $650 million in credit to over 500 businesses, improving livelihoods for 750,000 rural producer households. More information: www.rootcapital.org.

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