Both coffee and tea face major sustainability challenges in the years ahead. Producers will need to reduce the environmental impact of their products throughout their lifespans, as well as prepare mitigation measures, as climate change threatens the stability of supply chains.
Every step, from farm to disposal of used biomass, has associated social and environmental impacts. Credible sustainability strategies will need to focus on making improvements throughout the entire life cycle, including highly visible consumer-facing changes, as well as harder to see supply chain interventions.
Consumer interest in sustainably produced products is not reflected in the number of SKUs on the market that address such interests. Demand gaps are especially large in the developing world, where many consumers are concerned about the environment, but few coffee and tea products carry environmental claims.
While willingness to pay more for sustainable products remains low, especially in more price sensitive markets, this is not a reason for businesses not to invest in sustainability. Companies not taking the issue seriously will find themselves at a disadvantage with investors and potential customers, and in their supply chains.
Shrinking growing areas, climate change and rising demand will put coffee supplies under pressure in the long term. A collective response from all major coffee players is required to make coffee more climate-resilient and to prepare back-up options in times when supplies struggle to keep up with demand.
Tea is a much more fragmented industry than coffee, which makes centralised action on sustainability more challenging. Mitigation measures need to be taken at national or local levels. With climate change threatening the unique tastes and health benefits of tea, both of which are cornerstones of the industry’s long-term growth goals, there is a strong incentive for tea companies to invest in mitigation measures to maintain the quality of their products.
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