Starbucks to increase loans to coffee producers in Costa Rica

By Jean Guerrero

MarketWatch

November 13, 2011

HERRADURA, Costa Rica -(MarketWatch)- Starbucks Corp. expects to invest $20 million in pre-harvesting credit for coffee producers by 2015, representing a 37% increase from last year's financing, a top company official said Saturday.

"We generate a lot of cash for investment," said Colman Cuff, vice president of coffee and tea for Starbucks Coffee Trading Co., speaking at the international coffee event Sintercafe. "In the past, we've taken the cash and opened stores, now we've diversified our business."

Last year, the coffee company loaned coffee producers $14.6 million. He said that, over the next few years, the company plans to open multiple new farmer support centers to provide coffee producers with agronomy and technical support.

Cuff also said the company anticipates 86% of its green-coffee purchases this year to be under its C.A.F.E. Practices certification program, based on preliminary figures. In 2010, 84% of its green-coffee bean purchases were under the scheme.

Much of the coffee beans that Starbucks purchases that are under other certification programs are also certified C.A.F.E. Practices.

He added that he thinks demand for single-serve coffee is increasing, and not just in the U.S. "We think Asia Pacific has the potential to grow significantly in this segment."