Coffee production remains important to Nicaragua. Photo by David Zentz.
By Claudia Adrien
Driving on the highway, in his red Toyota SUV, the 45-year-old farmer points to either side of the road.
“This used to be a coffee farm,” he repeats every two or three minutes.
Roman is lucky. He has not been forced out of business yet. Although he holds onto an industry so much a part of his past, the effects of intranational competition and an international crisis may create a bitter future for the coffee growers of Carazo, Nicaragua. Agrarian reforms, regional competition, and inequitable economic policies are at the root of a Nicaraguan coffee crisis 25 years after the Sandinista revolution.
National and International Crisis
“Coffee is like water here,” Roman says, adding that Carazo would lose much of its identity without the crop.
In fact, coffee, like water, is a necessity for Nicaraguans. As the country’s largest industry, coffee employs more than 200,000 workers.
Carazo, though, is experiencing a bit of dehydration.
Roman remembers a time when his family used to produce the coffee themselves. They would occupy a humble 19th century farm house for several months during the harvest on their estate. Now the house is boarded and locked up. Several hundred yards left of it is an old coffee factory, what the Nicaraguans call a Beneficio. There his family de-pulped the coffee bean and prepared it for sale. Now the factory acts as storage space and a place to rest for the more than 300 workers employed seasonally on the farm.
“It’s [the coffee] produced at Santa Rosa now,” Roman said.
Santa Rosa Beneficio, located on the outskirts of Jinotepe, is one of three coffee factories still remaining in Carazo. There used to be seven, but the Sandinistas made some modifications, says Crecencio Medrano, the head mechanic at Santa Rosa. He’s worked at the factory for 30 years, and makes 100 cordobas a week, about $6.25.
In 1978, the Sandinistas gained control of the Nicaraguan government after ousting Nicaraguan dictator Anastacio Somoza. Somoza, backed by the United States, favored Nicaragua’s agrarian elite and ignored the country’s growing class inequities. To remedy the economic injustices the Sandinistas saw, they implemented sweeping agrarian reform measures by redistributing the property of wealthy farm owners.
“They took this factory, and the owner had to pay [local Sandinistas] to recover it,” Medrano says, gesturing with his oil-stained hands to emphasize his points.
Although they are waiting on the coffee harvest, employees at Santa Rosa are making preparations in the factory, Medrano indicates. Two employees, though, play checkers, and others sharpen an occasional tool. They wait. Santa Rosa is a ghost town.
And coffee production isn’t what is used to be. In years past, processing coffee occurred over a four-month stretch. But Santa Rosa produces coffee only two months out of the year, between October and December.
The Sandinista legacy isn’t the only hurdle Nicaraguan farmers face.
Silvio Acevedo, a friend of Roman’s, says the Hemileia Vastatrik Berk fungus, more commonly known as coffee leaf rust, devastated Carazo’s coffee farms in the late 1970s. The epidemic occurred throughout Latin America’s coffee producing areas, arriving in Nicaragua via Brazil.
“The front part of my farm had the first infection,” claims the farmer. “You never get rid of the fungus.”
Instead, the goal of coffee growers is to control and minimize the fungus. Three decades ago the Nicaraguan government didn’t accomplish that effectively and destroyed all the coffee trees in Carazo’s infected areas. Acevedo says farmers now know the fungus can be controlled by spraying a copper-based substance on the plant, but it took Carazo growers several years to recover their crop.
The damage was done. As Latin America struggled to grow coffee, new markets saw this devastation as an opportunity. Countries that didn’t have a history of producing the crop became international contenders, and by the late 1990s, Vietnam became the world’s second largest producer of coffee behind Brazil. The Asian market had a workforce willing to work for less. This was promising news for many multi-national organizations.
“We’re hurting because of over-production,” Roman says. “The bottom line is that coffee is everywhere.”
In 1997, the problem got worse. The International Coffee Organization, whose members were both government and corporate officials, fell apart. The organization served to prevent price gouging while establishing a set price per pound of coffee. When the ICO dismantled after the United States pulled out of it, the four major multinational coffee roasters (Kraft, Nestle, Proctor & Gamble and Sara Lee) had the ability to set their own prices. Everyone in the coffee-production chain received less in profits yet the price charged to consumers for coffee increased. Coffee farmers were going bankrupt.
But Acevedo blames additional factors affecting Carazo’s coffee production.
“The government ignores us,” he says.
Although the Sandinistas no longer maintain full control of the Nicaraguan government, he argues coffee resources are allocated elsewhere.
“The ex-Sandinista generals have capital in the North,” he says, insisting nepotism plays a crucial role in the north’s relative coffee success.
Acevedo, hard hit by low yields, has already developed new sources of income by growing broccoli, and he and his wife are now event planners for political and business functions in Managua.
“I can’t survive as a farmer,” he says.
A Nicaraguan Tradition
Coffee came to Nicaragua in 1821 when Manuel Matus Torres established the finca La Ceiba coffee plantation in Jinotepe. Jinotepe, the largest city in the department of Carazo, is about 45 minutes southwest of Managua by car and is part of what’s called the Southern Upland. There, an ideal land elevation and soil made of volcanic ash provide good prerequisites for successful coffee production.
As German immigrants who came to Nicaragua during the mid-19th century, Roman’s family eventually settled in Jinotepe, hoping to become prosperous coffee farmers. Generations later, Roman and his father are still farming the trees. But more and more coffee giants have sold their farms to real-estate developers, unable to compete in the coffee market.
Just outside of Jinotepe lies Australia, one of the oldest farms in Carazo.
“My parents liked the South Pacific,” Roman says, explaining the origin of the farm’s name.
Australia is a 300-acre spread of rolling hills and a dense ocean of coffee plants. Between them, acting as a canopy, an occasional teak, cedar or eucalyptus tree appears, standing tall above the crop.
“On other farms in other countries you don’t see trees,” Roman says.
Coffee is grown naturally under shade, but farmers in other places have opted for slash-and-burn agriculture, clearing land by burning down forests, to grow coffee in the sweltering sun.
The sun’s light is dim on Roman’s farm, peeking through the trees. Eerie, yet beautiful, the low-lying mist makes everything look soft and hazy. A canary’s high-pitched sound echoes occasionally.
This place is gigantic, bigger than a dozen suburban shopping malls combined. Roman’s 6-foot frame, taller than most Nicaraguans, doesn’t exceed the height of his coffee trees as he reaches to check for the ripe red beans. In three weeks, at the end of October, this place will be ready for picking.
The glory of Roman’s farm, though, is deceiving. Coffee isn’t what it used to be in Carazo.
North v. South
The school of economics at the Universidad Nacional Autonoma de Nicaragua in Managua is basic, consisting of no more than four detached sections and bare courtyards in between. The only splash of color on the school’s pale green walls is a painting of the mythic Argentine-born revolutionary Che Guevara. Luis Rodriguez's office, like most places in Nicaragua, has no air-conditioning, and the cramped space allows the economics professor only room to wedge uncomfortably around his desk.
Carazo is 600 meters above sea level, says Rodriguez, an economics professor at the university. The higher elevation of northern Nicaragua along with its more frequent rainfall causes the soil’s acidity to be ideal for coffee growing. As a result, Nicaragua’s northern region produces coffee for twice as long as the south with yields of more than one million pounds per year. Carazo’s farms produce only 100,000 pounds of coffee annually.
Rodriguez doubts government nepotism plays a great role in either region’s coffee success. He holds many of the farmers responsible for the poverty coffee perpetuates.
“It’s miserable what they earn,” Rodriguez says of the coffee pickers.
Pickers begin their work about 4:30 a.m. and end it well past dark, earning less than $2 each day.
Paul Katzeff, the owner of Thanksgiving Coffee Company, based in Fort Bragg, Calif., buys Fair Trade Certified and organic coffees from farmers growing on cooperatives in Nicaragua’s northern city of Matagalpa. Fair Trade Certification is organized by multi-national groups that set criteria farmers must meet to have their products certified fair trade. One of these is a higher minimum wage for coffee workers. But most Nicaraguan coffee pickers earn less than the minimum standard for Fair Trade Certification. During the past three years, workers in Nicaragua have marched from Matagalpa to the capital demanding for greater regulation of the industry. The lack of government action forces some to travel to Costa Rica, Honduras, and even the United States to seek work illegally. Others remain and are forced to become homeless.
“People end up squatting on the land or in the streets,” Katzeff says. “That’s the coffee crisis.”
In Nicaragua, the International Monetary Fund (IMF), an organization that strives to promote trade and economic growth in many developing nations, perpetuates Nicaragua’s coffee problems, Katzeff says. When farmers of large-scale farms declare bankruptcy, the IMF repossesses the land, sells it to local banks, and then the banks, in turn, sell the land to real-estate developers. Viable land for coffee becomes extinct. Katzeff says he would rather see repossessed land sold directly to cooperatives so that coffee production could continue.
Katzeff’s politics are clear. “Social justice never tasted so good” is the slogan for the End the Embargo Coffee his company sells, where 15 percent of the profits go to a charitable organization in Cuba. He sells another coffee line that helps protect mountain gorillas in Rwanda, Africa.
“I was just trying to make a buck,” Katzeff admits about his early coffee ventures in Nicaragua.
But Nicaragua became his other home. He has traveled to the country 65 times in the past 19 years, living in Nicaragua during the height of the Sandinista revolution. He befriended Daniel Ortega, the Sandinista party leader and former Nicaraguan president, once taking Ortega’s six children to a baseball game at Roberto Clemente Stadium in Managua.
“The people of Nicaragua were ready for social change,” Katzeff says of the revolution. “But the Sandinistas were not good businessmen.”
Cooperatives are now the only hope for Nicaragua’s coffee industry, he says. They operate on a system of collective ownership, where a dozen small farmers individually grow coffee on a few acres of land and sell their crop as a group. The money earned is then put back into the cooperative and supports education and health care programs for the farmers and their families. A Nicaraguan Fair Trade producer from a cooperative in Matagalpa won the International Cup of Excellence award this year, proving that cooperatives can produce a good product, Katzeff says.
As a professor, Rodriguez spent decades researching coffee and says cooperatives may be the only means of survival for coffee growers. But Fair Trade Certified coffee will do little to help the country, he says. The north has the most potential to gain footing in the international coffee market, but he sees little future in the industry and hopes the Nicaraguan government diversifies its economy soon.
“Only 8 percent of the market is fair trade and organic,” Rodriguez says.
It’s not great enough to combat the problems of large scale coffee production, because the big producers are the ones with the greatest debt.
“They [the government] should eliminate coffee completely.”
And that may be happening, irrespective of government intervention.
The end of an era
About 15 minutes north of Jinotepe is the smaller town of Masatepe. Its streets are narrower, and a visitor is just as likely to see a horse-drawn cart as an automobile. Here, the homes are quintessentially Nicaraguan, each one painted a different primary color.
Supporters of the Liberal Constitutionalist Party (PLC) - the party of Nicaragua’s current president- march through the center of town. Holding their red flags, wearing the color on T-shirts and hats, a dozen men and women pack themselves into the back of a gray, beat-up truck, while a man in the passenger seat shouts “Vote for liberals” and “We’re going to win” through a bull-horn. Spanish reggae blares on the truck’s radio.
Farmer Enrique Montenegro stands between the elaborate wrought-iron Spanish doors that separate his home from the streets to watch.
“Yes,” he says nodding. “That’s my party.”
Montenegro’s politics are of an older era. He unabashedly supported the Somoza regime and saw the 1970s Sandinista take-over as disastrous. For him, there’s no middle ground.
“Before the Sandinistas, the production of coffee was very good,” Montenegro says. “But with them, it all fell down.”
Despite coffee’s decline in Carazo, by appearance, it’s difficult to see how a farmer like Montenegro struggles.
The iron gates to his homes’ entrance open to a parlor with a black and white tile floor a stark contrast from the dirt ones in most Nicaraguan homes. Oil paintings of fruit hang on the walls. Next to the seating area of four wicker rocking chairs is an upright late-19th century piano displaying generations of family portraits. Right of the piano is a photo of Montenegro, wearing a black hat, gray suit and tie as he sits commandingly on a horse. The photo, like everything else in the house, has history.
Montenegro’s wife, Milagros, proudly shows off the home while pointing to the kitchen, her gardens, and even across the street. Behind this part of the home is a separate section for the bedrooms.
“Muy grande,” she says.
In fact, Montenegro can’t recall how many generations lived in this house, except that they all farmed coffee.
But Fabio Montenegro Porras has other plans.
“My father is the one who works in coffee,” says Montenegro’s son.
Porras, who’s in his 30s, is the first of eight generations to break with family tradition, not because he wants to, but because he says he must.
Two years ago, with $70,000 in hand, Porras and a couple of his friends established Abonicsa, an organic fertilizer company in Managua. The farmers, in general, are adopting organic methods, because there’s a greater consumer demand for the products grown through organic methods, Porras says. He uses his organic fertilizer on his father’s farm.
Like Roman’s farm, many coffee plantations have closed near Montenegro’s, which is located 6 miles from Masatepe. Like Roman and Acevedo, Montenegro earns supplemental income, and he raises sheep to make ends meet.
More than 50 percent of farmers, though, couldn’t make it in Masatepe. As these farms foreclose, Porras indicates there will be an imbalance in coffee production in Nicaragua.
“People will need to get back into the industry,” he says.
But coffee, for his father, is more than production, trade wars and political parties. Coffee is his life.
On his Masatepe farm, Montenegro examines the leaves on his trees.
“When the trees are blooming, you can smell the fragrance of coffee,” Montenegro says. “When you get close to it, you can feel it.”
No Certain Future
At his office, formerly a family home, Roman sits in a beige wicker rocking chair, leaning over the glass coffee table in front of him. The home is virtually empty. He taps his cigarette twice, drawing it to his lips, and takes a long puff.
“We’re coffee growers, not politicians,” says the 45-year-old Nicaraguan farmer after the smoke clears.
But coffee without politics in Nicaragua is like Florida without the retirees. And retirement may be inevitable for Roman and other coffee farmers in Carazo.
Back on his farm, on the dirt road leaving Australia, two women run quickly from the onslaught of rain and Roman’s SUV. Roman drives erratically, as the SUV bobs up and down into the mud pot holes. Heading back to town, the sun has set, and the only light comes from the front of the vehicle. Roman says this must mean good luck. It hasn't rained in Carazo for a week.
Yet, Roman’s luck may soon run out. If the international market and the politics of Nicaragua remain constant, the initial success of coffee may fail to repeat itself in Carazo.
“It’s out of my hands.