March 20, 2013

Starbucks Expands $70m Sourcing Program

Source: http://www.environmentalleader.com/2013/03/20/starbucks-expands-70m-sourcing-program/

Starbucks Coffee Company is expanding its $70 million ethical sourcing program with a new
farming research and development center in Costa Rica intended to help coffee farmers around the world
mitigate climate change impact and support long-term crop stability. The company says these programs
are part of its ongoing billion-dollar commitment to ethically sourcing 100 percent of its coffee by 2015.

Starbucks will adapt this active 240-hectare farm located on the slopes of the Poas Volcano into a
global agronomy center. The work happening on this farm will enable the company to expand its
Coffee and Farming Equity practices (C.A.F.E.), the ethical sourcing model developed in partnership
with Conservation International to encourage social, environmental and economic standards in coffee
production. The farm will also influence the development of coffee varietals based on the insight
offered through soil management processes, Starbucks says.

The company says, in total, it has invested more than $70 million in collaborative farmer
programs and activities over the past 40 years, which include C.A.F.E. practices, farmer support
centers, farmer loans and forest carbon projects. All of these integrated programs support improving
farmer livelihoods and a long-term supply of sustainable coffee for the industry, Starbucks says.

The new facility will build on and globally scale the work currently happening at five farmer
support centers worldwide in Rwanda, Tanzania, Colombia, China, as well as Starbucks first farmer
support center that opened in San Jose, Costa Rica in 2004.

Starbucks farmer support centers are home to agronomists and experts working directly with
farmers. By providing farmers with expertise and training in soil management, field-crop production
and milling processes, these practices can improve the quality and size of the harvest. The varied
elevation of the farm will allow the agronomists to test responsible growing practices while ensuring
biological diversity. In 2008 Starbucks and Conservation International began conducting impact
assessments of C.A.F.E. practices on coffee farmers and communities, and in 2012 aggregated the year-
over-year performance impact. For example, on average farmers employing C.A.F.E. practices saw 98
percent of farms maintaining or improving soil fertility. Of the 545 million pounds of coffee purchased
by Starbucks in fiscal year 2012, across 29 countries, 93 percent of it was ethically sourced, according
to the assessment.

Starbucks has signed an agreement to purchase the Costa Rican farm through a subsidiary of
Starbucks Coffee Trading Company. The terms of the purchase are not being disclosed. Upon final
closing in May, Starbucks will immediately begin evolving the location into a research and
development facility.

Starbucks was named one of the Worlds Most Ethical Companies in Ethispheres annual list,
published earlier this month. The coffee company has made the list for the past seven years. In
February, Starbucks agreed to purchase 100 percent of its palm oil from certified sustainable suppliers
by 2015, according to Green Century Capital Management.