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1999 Downfall
of Kona Coffee
Can our Local
Industry Sustain Itself?
by Les Drent
After writing for six years on the subject of Kona
coffee and having expended countless number of hours
lobbying and writing for the protection and preservation
of our Kona coffee name, I have sworn many times to
remove myself of any personal involvement within this
industry outside of my coffee roasting and retailing
business which I truly love and enjoy to work at. At
times it just becomes too taxing on the system. And
after all, it’s like my old mentor, Jerry Greenfield
of Ben & Jerry’s Ice Cream says, if it’s
not fun why do it? (It's probably true that someone
else coined this phrase but Jerry made it into a bumper
sticker so I'll credit him.) But it is this same passion
and pride and also enjoyment I derive from producing
a "100% Hawaiian Made" product that continues
to fuel my editorial fires, and why every six months
I get up on my soap box set my opinions free and write
on the subject of what is happening within our embattled
Kona coffee industry. Believe it or not every time I'm
finished writing I do feel like I've helped to shed
a little more light on the subject and hopefully pushed
us all a little closer to a more sustainable future
for 100% Kona coffee.
While the popularity of 100% Kona coffee, number of
farms, coffee trees and planted acreage in Kona continues
to increase, serious issues relating to long term economic
self-sustenance still confront our industry. Many communities
around our state would like to support a life-style
based on self-sustenance however, Hawaii continues to
import 90% of its food products from outside of the
islands. And while it is my opinion that our lives are
manipulated and controlled far too much by forces of
negative growth and runaway capitalism it seems that
this same growth is inescapable as our nation pushes
for a more streamlined and homogenized way of life.
In Hawaii this system unfortunately involves a mode
of business that all too often packages Hawaii into
nothing more than Taiwan Made trinkets.
As for 100% Kona coffee it is problems like the C.
Brewer company whose trucks bearing the name Royal Kona
Coffee on the back weave their way in and out of plush
island resorts delivering bogus Kona Blend coffee. Restaurants
then sell this same coffee as Kona on their menus. It
seems apparent that this is exactly what epitomizes
the entire state of Hawaii’s economy which has
been in desperate times for over ten years now. It is
this selling out ethic and greed that has become an
all too common business practice with a host of age
old companies that saw their roots first nurtured in
the Hawaiian soil whether it be in sugar cane, pineapple,
or coffee production.
The main question continues to be, what if anything
can help our 100% Kona coffee industry succeed in today’s
marketplace in the midst of these unfair trade practices?
The answers I believe are universal ones and stem to
all sectors of not only Hawaii but our entire nation.
For many visitors, who for the most part are uninformed
about the woeful economic state of Hawaii, it comes
as a great surprise to find our Islands struggling in
the midst of a flourishing economy on the mainland.
While goods and services continue to flow freely in
the national marketplace Hawaii has seen its economy
only worsen. Do not despair though. You have chosen
an island paradise to visit that is unrivaled by any
other. Our warm and hospitable people, natural environment
and colorful mix of cultures are as diverse and beautiful
as any in the world and for the many small business
owners that have opted to stay in Hawaii during troubled
times it is for the love of Hawaii that has kept them
home in the islands. This is what we call the Aloha
spirit and it is deeply embedded in the heart of our
people!
While for the last 150 years Hawaii and its work force
has had a great dependency on agricultural production
it has watched the slow decay of its agricultural king,
sugar, fade into the earth. This downturn of sugar production
in Hawaii began in the early 1980's with mainland companies
looking for a more competitive edge deciding to buy
cheaper foreign made sugar. Unfortunately it is only
a matter of time before sugar production in Hawaii will
cease to exist all together outside of a few specialty
farms producing 100% Hawaiian grown sugar. While sugar
is a prime example of Hawaii's time of transition it's
also a perfect example of how first world production
and a first world economy no longer mix in today's scheme.
All around Hawaii people are looking to breath new
life into the land with new specialty crops like vanilla,
cocoa, and of course coffee which is grown on just about
every island. Whether it be cooperative, corporate or
private, Hawaii will find the agricultural solution
to its problems... it just won't be overnight. Growing
these crops will not be the problem either it will be
finding a direct market for these specialty crops that
will be our true challenge.
Facing up to these truths about our changing marketplace
has us all realizing that our nation, for better or
for worse, has chosen to roll the dice in a game of
international and economic management. A game that relies
far too heavily on overseas production of US "brand"
goods as opposed to American "made" goods.
Whether you agree or don't agree with the shift of
how America makes its livelihood 100% Kona coffee is
one of those items that should still be able to fit
nicely into this scheme. After all it has already survived
three generations of farming families and 150 years
of busts and booms. Furthermore as a specialty product
marketed as a niche item in the ever increasing upscale
mainland economy it is providing a sustainable way of
life for many coffee producers, including my own. It
is important to note though that while 100% Kona coffee
may succeed in a successful economy this luxury item
will be the first to suffer when the economy goes south,
and like all successful economies it will eventually
go south. That is the main reason why Hawaii as well
as our nation needs to be involved more in the production
of other life sustaining agricultural commodities.
It is my opinion that for Hawaii the more hands in
the soil the better for all of us. Whether it be in
coffee, taro, soy beans or corn. The issue of 90% of
our food products coming from overseas is a scary predicament
but it is also a correctable one if we wish to create
a better future for Hawaii. And it certainly is a much
better predicament considering that all the food in
Los Angeles is only able to sustain that densely populated
region for three days!
Communities in Hawaii are making a move towards self
sustenance; the island of Kauai leads the state in Y2K
preparations as it gears up for any disruption in food
lines which may or may not occur as a result of the
millennium bug. Kauai mayor, Maryanne Kusaka, is recognized
nationally as the first Mayor in America to try to devise
a plan to counter any problems that could occur during
this time of change over or any other time of emergency.
It's also interesting to note that Kauai's self sustenance
program is one that is being embraced by the people
not only for emergency preparations but as a viable
and self sustaining way of life.
Bearing this in mind Hawaii and our wealth of land
and incredible growing conditions could produce, and
market for both profit and self-sustenance more if not
all of our agricultural products here in Hawaii. However,
protection of those Hawaiian grown products and their
names need to be at the forefront of this movement or
the incentives for farmers to grow for profit here at
home becomes meaningless.
There are numerous disturbing examples of foreign goods
in Hawaii being sold as Hawaiian products that litter
our store shelves with false claims. As both local and
visiting consumers we all need to be aware of what we
are buying and ultimately what system we are buying
into if we choose to ignore our conscience when buying
these goods. (I list some simple rules for buying gourmet
coffee at the end of this story.)
Holualoa coffee farmers,
John & Connie Collins, stayed faithful to 100% Kona
coffee and opted to sell their cherry to Bay View
Farm during the bidding wars of 1997-'98. In return
for their loyalty Bay View Farm, a strong proponent
of 100% Kona coffee, continued to pay their loyal
farmers a higher than average price for their coffee
during the downfall of the 1998-'98 season. |
While United States Customs in 1995 sent a loud message
to those seeking to counterfeit Kona coffee with the
indictment of Kona Kai Farms and their 20 million dollar
fraudulent green Kona coffee scheme, problems of unfair
trade practices still exist within our industry. U.S.
Customs has been extremely helpful in this struggle
while it continues to monitor and participate in the
protection of Kona coffee and other Hawaiian products
under Federal law.
With fair trade enforcement occurring at a federal
level in the Kona coffee industry locally the state
government is failing to adequately monitor the retail
coffee industry. For instance, a law exists that their
must be 10% Kona coffee in a package of coffee being
sold as "Kona Blend." This same package must
state the following disclaimer; "this coffee contains
a minimum of 10% Kona coffee." Why this same law
does not carry over to restaurant menus where the majority
of coffee consumption takes place is a mystery to many.
The same State Departments of Agriculture and Health
then turn around and monitor such things as a strict
Kona coffee grading and certification program. Why grade
or certify anything 100% Kona when that same product
can be legally placed on restaurant menus as something
containing 90% foreign coffee? The answer is really
quite simple. C. Brewer (d.b.a. Royal Kona Coffee),
Hawaiian Isles, and Lion Coffee are all major blenders
and manipulators of truth in labeling laws, but they
are also major contributors to the Hawaii excise tax
system. C. Brewer also happens to be one of the largest
employers in the State. It's felt by many that these
government officials will never bite the hand that feeds.
Perhaps this hand does not need to be bitten but only
redirected. It simply is not fair trade when truth in
labeling laws are not enforced.
However widespread the problems are in the misuse of
the Kona name there are problems that lie deeper. In
1997-1998 the two longtime coffee operations and major
proponents of Kona blend coffee, Hawaiian Isles and
C. Brewer, decided to set up camp in the hills of Kona
and stake their claim in the industry. While uninformed
farmers looking to get rich quickly rushed to the mill
doors to sell their coffee cherry to the highest bidders,
local mills who are proponents of only 100% Kona coffee
struggled to match the prices of mills that offered
the higher prices. Subsequently, a fierce bidding war
began and the prices of Kona coffee skyrocketed. It
was obvious to all involved that the Kona blend coffee
companies were going to try to cripple the 100% Kona
coffee industry. After all what does it matter what
you pay for 100% Kona coffee when all you need to have
is 10% Kona in the bag of Kona blend you sell?
When the difficult coffee season came to an end the
Summer of 1998 slowly passed. Speculation brought high
hopes for the farmers looking to again cash in on the
high prices being offered for their coffee. Meanwhile
local mills and roasters worried about the prospects
of surviving another season of price wars. To make matters
worse a second serious threat surfaced within the industry.
During the previous year and after the fall out of
the Kona Kai Farms scandal a small minority of Kona
coffee purists launched a class action law suit against
several mainland coffee companies who allegedly purchased
fraudulent Kona coffee from Kona Kai Farms. The suit
targeted several faithful and long time customers and
roasters of 100% Kona coffee who were unsuspecting victims
of Kona Kai's ploys.
Starbucks who purchased a minimal amount of this fraudulent
coffee immediately paid a claim of fifteen thousand
dollars and vowed to never again buy Kona. Needless
to say this law suit has had a devastating effect of
potential customers of 100% Kona coffee and has made
matters even worse for those local mills trying to sell
their high priced 100% Kona coffee. Many local mills
who have worked hard over the years to promote and sell
only 100% Kona coffee have seen their customer bases
dwindle thanks to the witch hunt of a few small farms
and a band of lawyers that this magazine very regretfully
helped to introduce to these farmers.
When the 1998 Kona coffee season began it was to everyone's
surprise to see the price of Kona rapidly drop. While
the blenders struggled to unload their high priced oversupply
of coffee they had built up from last season the demand
for coffee cherry plummeted and caused these same mills
that drove the prices up the previous year to close
their doors to farmers the following year. With many
farmers left out in the cold with no source of income
some mills only accepted coffee from those farmers who
had been faithful during the price wars with the blenders
the year before.
One can not help but think that if every farmer who
had chased that pot of gold the year before had remained
faithful to local mills during their time of battling
blenders, that perhaps we would have seen some stability
in the market. And subsequently those mills selling
the blends would not have had the opportunity to disrupt
the stable economics of this industry and prices would
have remained consistent rather than rise to an all
time high in 1997-1998 ($1.75), to a bitter low (.55¢)
at the conclusion of the 1998-1999 season. It is exactly
this kind of erratic swing in stability that contributes
to everyone's lives being turned from riches to rags
in a matter of one Kona coffee season. Further evidence
that it's time for everyone to realize what is needed
to sustain and stabilize our future in Kona coffee.
Once again the universal and overriding theme of this
story seems to be pragmatically based on the attempted
infusion of foreign goods being sold as Hawaiian products.
Kona coffee is just one of many examples of how local
market stability in Hawaii and self sustenance are not
mixing in a first world economy that is attempting to
only market cheaper foreign made goods under deceptive
Hawaiian brand names. Perhaps it is through the 150
year old Kona coffee industry and its push for independence
that Hawaii will begin to focus on the universal theme
of becoming a self sustained group of islands that can
one day thrive and profit on the production of 100%
Hawaiian made products. The right solution however will
rely heavily on a system that places fair trade and
equal opportunity at the forefront of its legislative
agenda. Then perhaps that light at the end of the tunnel,
which does shine, will shine a little brighter.
Other notables: Coffee Times verbal push and written
shove with Borders Books and Music who was selling bogus
bags of Kona Blend coffee in their island cafes without
the disclaimer of "this coffee contains a minimum
10% Kona coffee" resulted in their removal of all
bags of coffee from their store shelves. Borders complied
within one week and our thanks to them for supporting
the preservation of 100% Kona coffee.
Customers Beware: Do not hesitate to ask about the
specific origin of the Hawaiian coffee you are looking
to purchase and be cautious when buying only ground
coffee. It is an easy way for illegitimate companies
to hide the particular characteristics of bad coffee.
The 3 simple rules that I follow when buying gourmet
coffee are as follows: 1. Know by personal name who
you are buying your coffee from 2. Make sure your coffee
has been roasted recently. 3. Know specifically of your
coffee’s origin and grade and seek some assurance
of certification or authenticity. Some bogus names that
have been recently used to deceive customers are: Kona
Hawaiian, Kona Style, Kona Blend, Kona Roast and Kona
Sunrise. These are not 100% Kona coffees and in most
cases contain
90% foreign coffee.
BUSTED
 What
is this? S&W Foods’ Kona coffee blend is
sold at Hawaii’s Safeway stores without the disclaimor
this coffee contains a minimum of 10% Kona printed
on the label. This is a direct violation of Hawaii
law. Who is enforcing this law and what incentive
does this give to Hawaiian farmers who work hard to
produce 100% Kona coffee is anyone’s guess? Ask
me and I’ll tell you that these cooks at S&W
care little about the truth and our local government
is not doing enough to enforce truth in labeling on
the retail shelf within the state of Hawaii.
"Readers
may submit editorial comments to any of our stories
by sending an email to les@lbdcoffee.com.
We would be happy to attach your comments and feedback
to anything we publish online. Thank you for your interest.":
Story appeared originally in Coffee Times print magazine and appears online for archival purposes only. Any use or reprinting of these stories without the expressed written consent of the author is prohibited.
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