Starbucks and the Ethiopian government have agreed to work together to reach agreement on the protection of Ethiopian coffee names in the United States.
Jim Donald, the Seattle-based coffee shop chain’s chief executive, met Meles Zenawi, the Ethiopian Prime Minister, in Addis Ababa on Tuesday after a month of controversy over Starbucks’ opposition to a bid to trademark the names of three Ethiopian coffee varieties.
Mr Zenawi told Mr Donald that the country’s main objective was to gradually increase export revenue from three coffee varieties and the share of the revenue that went to impoverished farmers. One important reason for the move, he said, was to stop farmers cutting down coffee trees and replacing them with the more lucrative narcotic plant Khat.
“The right to own our coffee names is the only way that we can preserve our rich coffee heritage,” Mr Zenawi said. “This is a rights issue and we deserve to have our rights recognized. We strongly believe that trademarking is the way to go.”
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Both parties said they had agreed to work together to find a solution to the protection and use of the intellectual property rights of Ethiopia’s specialty coffee names.
The Ethiopian Intellectual Property Office (EIPO) said that Starbucks shared Addis Ababa’s objective, but that the company’s position had not changed on the trademarking of the names despite Mr Zenawi offering the company a royalty-free licensing agreement.
Starbucks reiterated its view that there were better alternatives, such as regional certification, and Addis Ababa explained again that it had looked at all the alternatives in depth and consulted stakeholders.
It still felt that trademarks would be most effective and said it was offering “less stringent licensing agreements to coffee roasting and distribution companies than those commonly known.”
“The Ethiopian side believes that it should not take much time for Starbucks to accept Ethiopia’s approach,” the EIPO said after the talks.
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“With the growing public support for this initiative, prompted not least by the continuing refusal of Starbucks to accept Ethiopia’s right to trademark its heritage coffees, Ethiopia feels that it is rapidly gaining consumers’ backing and that respecting and promoting intellectual property rights of developing nations will become a new standard for corporate social responsibility.”
Aid organisation Oxfam, which has been calling for Starbucks to accept the trademark bid, said that 85,000 people had protested to the company about its stance.
Starbucks CEO Jim Donald said, “We were grateful for the opportunity to meet with the Ethiopian Prime Minister Melese [sic] Zenawi to talk about how we can work together on initiatives that will benefit coffee farmers. We believe the meeting was very cooperative and productive and we are committed to working with the Ethiopian government to find a solution that supports the Ethiopian coffee farmer.”
Starbucks sells Ethiopian Sidamo, Harar and Yirgacheffe branded coffee in its 12,400 outlets at up to $26 per pound of beans. The EIPO has applied for trademarks for these regional names in more than 30 countries saying this would allow Ethiopia’s independent coffee farmers to charge more than the buyer-led prices of between 75 cents and $1.60 per pound.
Getachew Mengistie, the EIPO’s director-general said, “In peak season a coffee farmer can afford to buy food for his family, and maybe clothes. In the other seasons they may not be able to buy food. Instead of $1, a tripling or even a doubling would mean sending his kids to school.”
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Oxfam has said that coffee growers in other parts of the world earned up to 45 per cent of the retail price for their beans. Ethiopian farmers were earning between 5 per cent and 10 per cent.
The EIPO said that Canada had granted trademarks for all three names, the EU had granted two and the United States allowed Yirgacheffe. But the National Coffee Association in the United States filed an objection that saw the other two fail.
A bitter row erupted last month when Oxfam accused Starbucks of prompting the NCA’s objection. Both the NCA and Starbucks have denied this.
Starbucks has said it preferred a regional certification alternative as used in other countries to protect the names of premium food and wine. It said it did not think trademarks would benefit farmers.
Addis Ababa has said previously that securing the trademarks would increase its leverage in price negotiations and ultimately derive a greater share of the retail price in the global market.
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“The coffees are part of our national heritage,” the EIPO said on Wednesday. This is clearly about the long term.”
Coffee originated in Ethiopia.
“It’s significant that after a year of trying to engage Starbucks on trademarks, the company finally sat down to discuss the issue directly with Ethiopia,” said Seth Petchers, coffee leader for Oxfam’s Make Trade Fair campaign.
“Starbucks must now follow up with immediate action to recognize Ethiopia’s rights to own the names of its coffees to ensure that coffee farmers get a fairer share of the value of their crop.”