1 big thing: Growing coffee for peanuts
By one measure, coffee has rarely had a better day — it is the beverage fashion of choice, conferring class, cachet and cool on its drinkers almost regardless of their age or station, leading to chronic lines out the door of cafes.
- But that's only if you are a retailer or restaurateur: If you are growing the beans, it is a time of want, with prices at 14-year lows and farmers leaving the business in droves.
- Now, with what experts fear could be the collapse of a crop that has lifted numerous regions out of poverty, growers are making a new attempt to save themselves.
What's happening: For decades, coffee growers, serving among the most internationally dispersed clientele in food, have weathered topsy-turvy prices, the result of chronic over-growing, mostly by Brazil. In 1962, the growers, inspired by the creation of OPEC by oil producers two years earlier, decided to do something about their misery. They started what they called the International Coffee Agreement, a cartel through which they would attempt to control production, and thus prices.
- The agreement injected some stability into the market, but was undercut in the late 1980s when the U.S. withdrew. Since then, growers have made various new attempts to enforce supply discipline on themselves. But so far nothing has worked.
- The latest attempt occurred this week in Capinas, Brazil, where growers met to try to dig out of the price trough.
- Meeting Wednesday and yesterday, they agreed to differentiate coffee with stamps denoting a bean's origin and other factors, Reuters' Marcelo Teixeira reports. Production will not be tightened.
What they're saying: "The tragedy is that even though we are paying $5 for Starbucks, this is not trickling down to the producer. If a more equitable mode of production doesn't emerge, I don't know what the future of coffee is," Carmen Kordick, a professor at Southern Connecticut State University and the author of "The Saints of Progress," tells Axios.
What's next: In May the price of beans plunged to 87 cents a pound, far below the approximately $1.20 price of production, though it has since risen to $1.06. Weighing on the price continues to be oversupply, particularly from Brazil and Vietnam, the biggest producers.
- The only relief has been for farmers growing particularly valued beans, such as those from parts of Tarrazu, Costa Rica, whose crop commands a significantly higher price, Kordick said.
- If you are not from such a region, the only thing that has provided balance over the years has been the occasional natural disaster, said Jonathan Morris, a professor at the University of Hertfordshire and the author of "Coffee: A global history."
- In 2007, a disease called coffee rust wiped out coffee in Latin America, pushing prices back up to relatively high 1990s levels.
Morris advocates a simple solution: People in places that are not currently quaffing down coffee, like Americans for instance, need to start — especially in countries that are primary bean growers. He singles out China, India, Vietnam, and much of Africa.
- In Campinas this week, the growers made a stab at promoting producer consumption. Over the coming months and years, it will be seen if they come through.
- Meanwhile, experts say a lot of growers may not survive.
2. Thanks a lot, millennials
As we've been following, several American staples — mayonnaise, American cheese, breakfast cereal — are dying slow deaths, and millennials are shouldering much of the blame.
- The tastes of the younger generations are not just shaking up the condiments aisle and the cheese section, but entire companies and brands that, as recently as a few decades ago, seemed as permanently American as apple pie.
What's happening: From Campbell's to Clairol and CoverGirl, some of America's most famous supermarket and drug store brands are losing market share, reports Axios' Courtenay Brown.
- Kraft Heinz this year marked down the value of its Oscar Mayer and Kraft brands — with products like hot dogs, Jell-O and Kraft Mac & Cheese — by $15 billion.
- Coty, which purchased the Clairol and CoverGirl brands from Procter & Gamble 3 years ago, recently wrote down their value by $3 billion, following a previous writedown of $965 million.
- Sales of Campbell's namesake soups have fallen in 8 of the past 10 fiscal years, per the WSJ.
What to watch: As older companies scramble to keep up with upstart competitors, they are introducing more modern product lines, like ones with plant-based ingredients.
Bonus Mailbox: Tracing deepfakes
We wrote yesterday about several startups developing a new high-tech defense against deepfakes — verifying photos and videos the moment they're captured.
Today, Roy Azoulay, the founder of Serelay, published a detailed response at Medium.
Here's an excerpt:
"In absence of a universal standard for verification, we tend to apply a ‘reputation filter’ — we trust media based on the individual or organization that captured or published it. This means we are often inherently biased towards trusting people that look like us or share our political or ideological beliefs. With all the challenges relating to verify-at-capture, I think at the end of the day it is our best chance of proving a better leveled playing field and it is important we maintain an open and transparent discussion while doing so."
3. What you may have missed
Exhausting week? No worries — here's the best of Future since Monday.
1. Conforming truckers: A drastic shift for an individualistic industry
2. Race for AI rules: Jostling for the future of a transformative technology
3. SCOTUS-fueled anger: The court has stirred up populism
4. The deepfake authenticators: Figuring out what's real
4. Worthy of your time
Japan's post office as a bonds powerhouse (Chris Anstey - Bloomberg)
Immigrants are moving to smaller cities (Kim Hart - Axios)
Big brands are starting to sponsor women's soccer (The Economist)
What's with the Elektorornis' toe? (Becky Ferreira - NYT)
Actually, bystanders ready to help (Richard Florida - Citylab)
5. 1 fun thing: Resurrecting an '80s mall
We've written about companies that are making the most of dead malls, turning them into housing, restaurants, doctors' offices, and even a college campus.
In Georgia, one down-and-out complex was completely revitalized and restored to its '80s-era grandeur for the third season of Stranger Things, the popular Netflix TV show, Kaveh writes.
- In a Twitter thread, writer and entrepreneur Andy Baio has a bunch of photos of the mall with its time-capsule appearance, a Radio Shack, arcade and Jazzercize studio — a total of about 40 stores and restaurants.
- In articles and a behind-the-scenes podcast, the Stranger Things crew describes the work that went into building the mall — including detailed storefronts and interiors that were never even on screen.
"You’d be shocked at the number of malls, particularly derelict malls, in the [Atlanta] area," the series' production designer, Chris Trujillo, told the LA Times.
- Of the complex his team settled on, Trujillo said, "It’s a massive mall that’s slowly been collapsing on itself for probably the 30 years it’s existed."
- Malls were "a place where people physically interacted in real time and real space and had these consumer adventures together,” said Trujillo. “More and more millennials are without that experience; they’re alone, shopping online.”