September 27, 2021

Carbon insetting in the coffee supply chain


The discussion about how climate change is affecting the coffee sector has been ongoing for some time. Rising temperatures and erratic weather patterns are already forcing producers to climb higher in search of optimal growing conditions, which is expensive and unrealistic for many.

In addition, the recently published IPCC report found that if greenhouse gas (GHG) emissions remain at the current level, average global temperatures are set to increase by 1.5°C by 2040. This could mean an increase in erratic weather patterns in coffee producing regions, including droughts and flooding. 

It’s clear that a move towards environmental sustainability should be a priority for all coffee sector stakeholders. However, at farm level, there are a number of techniques producers can implement. One of these is known as “carbon insetting”. To learn more about it, I spoke to two coffee professionals from Caravela Coffee. Read on to find out what they told me.

You may also like our article on carbon-negative coffee.

Insetting vs offsetting

To help mitigate the impact of climate change, practices like carbon offsetting are becoming increasingly popular with businesses around the world. The coffee sector is no exception.

Carbon offsetting is a practice that businesses undertake to balance their carbon footprint. Brands invest in environmental initiatives outside of their own operations, such as tree planting projects, for instance.

While investment in offsetting does support a business to offset its own carbon emissions, it does so through other companies’ supply chains. This means that brands can, in theory, pay to offset their emissions.

Alieth Polo is the Regional Director of Sustainability and PECA at Caravela. She defines the main difference between carbon insetting and offsetting.

“The difference is where you choose to make offsets,” Alieth explains. “Insetting allows you to make offsets within your supply chain, but offsetting allows you to make offsets anywhere.”

In essence, by practising carbon insetting rather than carbon offsetting, businesses can invest in making their own supply chain more sustainable – rather than simply paying to achieve it elsewhere.

Marisabel Vasquez is the Marketing Manager for Caravela. She says: “Carbon insetting means investing in projects or sustainability initiatives to capture CO2 within the same supply chain.”

The International Carbon Reduction and Offset Alliance first coined the term “carbon insetting”. It defined it as an up or downstream direct investment in a business’ own supply chain with the intention of reducing greenhouse gas emissions.

However, before carrying out any form of carbon insetting, a company must first calculate the carbon emissions of its entire supply chain. This can be a difficult task.

Marisabel says: “A company first calculates and measures [the] carbon footprint of the operation and its whole supply chain, and then gives back to the environment by investing in sustainable projects.

“These projects might be planting trees for carbon sequestration or investing in the protection and conservation of flora and fauna, among other things.”

A view of a coffee farm from above.

The benefits of carbon insetting

Although there are several positives to carbon offsetting, insetting is inherently more sustainable in the long term.

“Any actions that a company takes to fight climate change is important and necessary,” Marisabel says. “However, when you practise carbon insetting, you are doing more than just [paying to offset your footprint].

“For instance, in coffee, when we ‘inset’, we directly invest back into the coffee farms that are affected by the impact of climate change.”

This is especially important, as much of the inflated cost of environmentally friendly coffee production is passed onto farmers. While this higher cost of production might translate to “greener” coffee, it can also be less financially sustainable for the producer.

Marisabel says that it’s important to communicate properly when implementing new sustainable practices at origin.

“Training for farmers is key if you’re going to achieve better farming practices,” she says. “You also need constant feedback on the results from the producers, to make sure that quality is high, and that the social, technical, and environmental practices work for them.

“Ultimately, insetting means much more than paying to make up for your footprint. It means giving back to the land and producers that provide us with the best coffee.”

By implementing more sustainable and thoughtful operations across the board, carbon insetting could even support coffee companies to become carbon-neutral..

“You can see the impact first-hand, and it gives you direct [control] of your investments and projects,” she says. “In other words, you’re giving back to the same land and people who give us so much.”

These kinds of investments in sustainable coffee production are becoming increasingly vital, too. Scientists predict that as much as 50% of arabica-growing land could become unsuitable for coffee production by 2050.

Marisabel says that at its simplest level, carbon insetting is about companies accepting the direct impacts of their operations on the environment.

“Companies that practise carbon insetting take direct responsibility for the carbon emissions and environmental footprint of their own operations,” she says. “It’s also an opportunity to add value to the supply chain and improve the quality of the product.”

Solar panel on the roof of a coffee farm that practises carbon insetting.

What does carbon insetting lay the foundations for?

The majority of carbon insetting schemes focus on the production end of the coffee supply chain. Specific actions include investing in shade-grown coffee, planting more trees, using organic farming methods, and intercropping. 

But how can we support farmers in implementing these techniques?

Alieth explains that training and education is a pillar of “all-round long-term support for coffee farmers”.

She says: “PECA [is Caravela’s Grower Education programme]. Its main objective is to continuously train coffee growers in sustainable practices to improve productivity and quality.”

The PECA programme operates with a team of 40 members working on the ground in seven different countries. Between them, they train more than 2,000 coffee farmers every year.

“Our programme has four important areas of focus: productivity and efficiency, cup quality, sustainability, and farm management,” Alieth explains

However, beyond training, producers often need support at the first stage of carbon insetting: assessing their emissions and mapping their carbon footprint.

“In 2020, with the support of Solidaridad, Caravela did a pilot test in Planadas, Colombia to measure the carbon footprint of more than 50 coffee farms, both conventional and organic,” Marisabel says.

“The data gathered has helped us understand what the opportunities and the challenges are for farmers looking to become carbon-neutral or carbon-negative.”

Once farmers have this information, they can use a number of specific farming practices to reduce their footprint.

“Soil conservation, shade tree growth, proper water treatment, and fertilisation plans are just some of the topics we educate producers in,” Marisabel says.

She also encourages the use of natural and organic inputs and control products, noting that these can be more sustainable.

“We implement physical and cultural pest controls before applying pesticides,” she says. “When that is not sufficient, we promote the use of sustainable pesticides that have been certified by food safety organisations. 

“We also promote forest conservation to allow for more biodiversity and microclimates.”

Two coffee farmers show off their crop.

Becoming more sustainable in the long term

Marisabel says: “Climate change is one of the main challenges that coffee growers face around the world. 

“Evidence of the effects of global warming can already be seen in coffee growing regions: excessive rains or droughts, extreme temperatures, and shifting growing seasons.”

Unpredictable and volatile weather patterns can lead to smaller or less consistent coffee harvests, causing yields to fall and affecting individual farmers’ livelihoods.

“If we want coffee to continue existing for years to come, we must support the sustainability of the product,” Marisabel tells me. “This isn’t just in a social and economic sense, but also an environmental one.”

Pushing to become carbon neutral is one way in which coffee businesses across the board can drive environmental sustainability. 

She says: “By working alongside One Carbon World – a UK NGO that is part of the UN’s Climate Neutral Now initiative – our team measured, verified, and offset 100% of Caravela’s 2020 carbon emissions. This made us the world’s first carbon neutral-certified green coffee trading company.

“Following this, we aim to have every kilogram of green coffee we purchase certified as carbon neutral by 2025.”

Roasting coffee.

How can carbon insetting benefit the wider supply chain?

Producers are arguably the most vulnerable actors in the coffee supply chain as far as climate change is concerned. 

This is because the extreme and disruptive weather patterns which have been linked with climate change occur most frequently in equatorial regions – which is also where most of the world’s coffee is produced.

“If we do not take action now, we may not have coffee in the areas where it is currently produced,” Alieth says. “Climate change causes weather patterns to change, leading to more severe pest and disease attacks and reduced productivity.

“This leads to further [issues] in areas where coffee can be planted, as producers cut down trees and compromise existing ecosystems to replant their crops.”

Coffee farmers are not the only supply chain actors at risk, however, but Alieth notes that production is the “first step” in improving the supply chain.

“It is necessary and imperative to take action now,” she says. “As a part of the supply chain, we understand the responsibility and need to promote climate-smart and sustainable agricultural practices, starting with coffee farmers.”

Marisabel emphasises the importance of the industry working as a collective towards carbon-neutral or even carbon-negative coffee.

“However, to be able to have a greater impact on the supply chain, we cannot do this by ourselves,” she says. “We need the support of coffee roasters and consumers to generate awareness about the main challenges, and invest in environmentally friendly supply chains.

“To generate awareness among coffee roasters, we have even started printing the carbon footprint of the green coffee of every origin in our coffee bags.”

But it’s not just industry stakeholders involved. Consumer interest in sustainable coffee is growing, too. Research suggests that as many as 41% of millennials are willing to invest in sustainable products, showing that the demand for carbon-neutral coffee is certainly there.

Across the board, major coffee companies have responded. Brands like Starbucks, illycaffé, Lavazza, and Nespresso have all announced targets to become carbon-neutral or carbon-negative in the next decade. 

Among other things, they have outlined a move to reduce greenhouse gas emissions from coffee farms, shipping, roasteries, cafés, and consumer products – encompassing the entirety of the coffee supply chain.

A rainforest that coexists with a coffee farm.

Any sustainable investment in the coffee supply chain is a step towards mitigating the impact of climate change. However, carbon insetting is a great example of how a company can make a direct effort to become more sustainable, rather than offsetting their footprint with carbon credits.

By focusing on reducing or eliminating their carbon footprint, coffee businesses can help to secure a viable future for the industry.

Enjoyed this? Then read our article on minimising the carbon footprint of organic coffee production.

Photo credits: Caravela Coffee

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