Starbucks Expands Global Effort to Protect Future of Coffee with Two New Coffee Farms

Rhea-AI Summary

Starbucks has announced an expansion of its collaborative coffee innovation network to protect the future of coffee. The company has added new coffee farms in Guatemala and Costa Rica, with plans for future investments in Africa and Asia. These farms will focus on increasing productivity, improving farmer profitability, and building climate resilience.

The initiative builds on Starbucks' work at Hacienda Alsacia, its first company-operated coffee farm. The new farms will study hybrid coffee varieties under different conditions and explore the use of mechanization and drone technology to address labor challenges. Starbucks has already distributed nearly 90 million climate-resistant coffee trees and over 53 million seedlings to farmers as part of its commitment to distribute 100 million trees by 2025.

This expansion is part of Starbucks' broader coffee innovation network, which includes 10 Farmer Support Centers and 70 'model farms' within its supply chain. The company aims to develop solutions that can be applied across industries affected by climate change.

Positive

• Expansion of coffee innovation network with new farms in Guatemala and Costa Rica
• Plans for future farm investments in Africa and Asia
• Distribution of nearly 90 million climate-resistant coffee trees to farmers
• Research focus on increasing productivity, improving farmer profitability, and building climate resilience
• Exploration of mechanization and drone technology to address labor challenges

Negative

• Climate change impacting availability and quality of high-quality coffee
• Rising temperatures causing drought and coffee leaf rust disease
• Labor availability challenges for farmers in Latin America

Insights

Agricultural Sustainability Expert

Starbucks' expansion of its coffee innovation network is a significant move in the coffee industry. The addition of farms in Guatemala and Costa Rica, with plans for Africa and Asia, demonstrates a comprehensive approach to addressing climate change impacts on coffee production. This initiative goes beyond mere sustainability efforts; it's a strategic investment in the company's supply chain resilience. The focus on developing climate-resistant coffee varieties and improving farming practices could lead to more stable coffee supplies and potentially lower input costs in the long term. However, the full impact of these investments may take years to materialize and success is not guaranteed given the unpredictable nature of climate change. Investors should view this as a long-term strategy to mitigate supply chain risks rather than an immediate boost to profitability.

Market Research Analyst

This initiative aligns with growing consumer demand for sustainably sourced products and corporate responsibility. By investing in coffee farming communities and sustainability, Starbucks is strengthening its brand image and potentially attracting environmentally conscious consumers. The company's commitment to distribute 100 million coffee trees by 2025, with 90 million already distributed, shows tangible progress. This could positively impact consumer perception and loyalty, potentially driving sales growth. However, the direct financial impact is difficult to quantify in the short term. Investors should monitor how Starbucks leverages these initiatives in its marketing and whether it translates to increased market share or premium pricing power in the competitive coffee market.

In collaboration with coffee farmers around the world, Starbucks to scale solutions to ensure the future of coffee for all; adds two new coffee innovation farms located in Guatemala and Costa Rica with future farm investments in Africa and Asia.

Investments build on Starbucks work with farmers to help increase productivity on farms, increase profitability for farmers and mitigate the impact of climate change on coffee.

SEATTLE--(BUSINESS WIRE)-- Starbucks today announced an expansion of its collaborative coffee innovation network, further connecting farmers from around the world with resources to protect the future of coffee. Building on the groundbreaking global agronomy innovation at Hacienda Alsacia, Starbucks first company-operated coffee farm, the company added farms located in Guatemala and Costa Rica with future farm investments in Africa and Asia. The learning on these farms aims to find solutions to increase productivity on farms, support increased profitability for farmers and build climate resilience.

Starbucks agronomist at Hacienda Alsacia (Photo: Business Wire)

“Starbucks works with more than 450,000 farms that grow the highest quality Arabica coffee in the world,” said Michelle Burns, Starbucks evp of Global Coffee and Sustainability. “Our promise to those farmers and their communities is that we will always work to ensure a sustainable future of coffee for all. Our solution is to develop on-farm interventions, share seeds, research and practices across the industry to help farmers mitigate the impacts of climate change.”

Starbucks buys three percent of the world’s coffee, sourcing and roasting only Arabica coffee beans, a variety known for its rich and complex flavors. Climate change is impacting the availability of high-quality coffee around the world and farming communities are feeling the impact on productivity, crop quality and their livelihoods. Rising temperatures that cause drought, coffee leaf rust disease and other related climate challenges are impacting the availability, quality and taste of coffee as it’s known today.

At Hacienda Alsacia, Starbucks is working to mitigate the impacts of climate change. The company has created best practices to make growing coffee more profitable; developed the next generation of disease-resistant, quality coffee; and shared it all with farmers around the world. For example, since making the commitment to distribute 100 million coffee trees by 2025, Starbucks has distributed approximately 90 million climate-resistant coffee trees and more than 53 million coffee seedlings to farmers. Additional coffee innovation farms will enable more research in new geographies to better mitigate the threat of climate change.

The new farms in Costa Rica and Guatemala will both study hybrid coffee varieties under different elevations and soil conditions, which is a critical step in the research of new genetic material. The farm in Costa Rica, located next to Hacienda Alsacia, will also be designed to explore the use of mechanization, drones and other technologies to help support labor availability challenges that farmers in Latin America are facing. In Guatemala, one of Starbucks most important origins, the farm in the Antigua Valley will replicate a smallholder farming design with conditions that mirror challenges that many farms face today.

With future farm investments also planned for Africa and Asia, Starbucks will have a coffee innovation network spanning the three main growing regions of the “Coffee Belt” – Latin America, Africa, and Asia Pacific – and be equipped to study the varied cultures, landscapes and growing methods that all contribute to coffee flavor.

Research on Starbucks innovation farms will be scaled through the company’s coffee innovation network, a multi-pronged approach to ensuring a sustainable future of coffee for all. In addition to innovation farms, the network includes 10 Farmer Support Centers in coffee-growing regions around the world, where world-class agronomists collaborate directly with farmers on research and best practices, and 70 “model farms” within Starbucks supply chain, where solutions are put into action. The network’s focus on learning and innovation will continue through the sustainability learning and innovation lab at Hacienda Alsacia, which will break ground in December.

“Through these innovation farms, we will develop solutions that will not only improve coffee productivity and quality but also empower farmers with the tools and knowledge needed to thrive in a changing world and challenging climate,” said Roberto Vega, Starbucks vice president of Global Coffee Agronomy, R&D and Sustainability. “This work is done on behalf of coffee farmers everywhere with findings that can be applied across other industries and crops that are also impacted by climate change.”

For more information about Starbucks sustainability initiatives and coffee sourcing practices, please visit https://stories.starbucks.com/.

View source version on businesswire.com: https://www.businesswire.com/news/home/20241003231789/en/

Starbucks Media Relations

press@starbucks.com

206-318-7100

Source: Starbucks Corporation

FAQ

What new coffee farms has Starbucks (SBUX) added to its innovation network?

Starbucks has added new coffee farms in Guatemala and Costa Rica to its innovation network, with plans for future investments in Africa and Asia.

How many climate-resistant coffee trees has Starbucks (SBUX) distributed to farmers?

Starbucks has distributed approximately 90 million climate-resistant coffee trees and more than 53 million coffee seedlings to farmers.

What is the main goal of Starbucks' (SBUX) coffee innovation network expansion?

The main goal is to protect the future of coffee by increasing productivity on farms, improving farmer profitability, and building climate resilience.

How is Starbucks (SBUX) addressing labor challenges in coffee farming?

Starbucks is exploring the use of mechanization, drones, and other technologies to help support labor availability challenges that farmers, particularly in Latin America, are facing.