Labor shortage to limit Colombian coffee crops as beans go unpicked

JARDIN, Colombia (Reuters) - As Colombia cheers a return to its biggest coffee harvest in eight years after beating off a disease epidemic, farmers are running into a potentially more serious problem: a shortage of workers to gather swelling volumes of arabica beans.

Some regions have turned to town criers and loudspeaker bus-station announcements to find candidates for the arduous, cash-in-hand work, but the meagre response means more and more farmers are leaving some of their crop unpicked.

The labor shortages are a side effect of economic growth that has cut unemployment to historic lows. Experts say it will be tough for the world's top grower of mild arabica to expand far beyond 13 million 60-kg bags a year now. They say that will eventually push Colombian coffee prices COFCO-UGQ-NYC higher.

"There is talk of reaching 15, 18 million bags but the big question is who will pick it? I think we're approaching the ceiling," said Marcelo Salazar, head of the central Caldas branch of the farmer-funded National Coffee Growers' Federation.

In Colombia a key turn-off for coffee pickers, beyond exposure to the elements and the physical challenge of working on steep inclines, is the job's informality. Growers say they cannot afford to pay for pensions or other fringe benefits.

"Gathering coffee is for crazy people. It's a very hard job. I'm waiting to get into the army," said picker Alejandro Hernandez, 17, walking home in rubber boots on a wet Saturday in Fredonia, Antioquia, a collection bucket slung over his shoulder.

He currently earns 200,000 pesos (around S$105) a week, about a quarter more than the minimum wage. Colombia's construction boom and $24 billion highway building program are soaking up labour on top of a steady rural exodus shifting workers to cities.

Poorer areas like the southwest can still expand coffee output a little with land and hands to spare. But experts say Colombia, which has seen its global market slide to an 8 per cent share, will be unable to claw back the 15 per cent it enjoyed two decades ago.

The labour squeeze will likely raise Colombian prices in the longer term once steadily growing demand for its high-end beans exhausts production capacity. This could spur Central American rivals to boost output in response.

Fewer hands to carry out farm maintenance would also heighten the threat from coffee-eating berry borer pests. Infestations can decimate crops unless kept in check by scrupulous sweeping up of infected fruit.

The worker shortage is part of a broader human resource problem. The average age of coffee farmers is now 55, and their offspring are turning away from a business where financial volatility is one of the few certainties.

Colombia has about 600,000 coffee pickers. The coffee federation estimates that the biggest coffee areas need 20 to 40 per cent more pickers to ensure quality by picking each berry when it is at its ripest.

Colombia's high altitudes that enhance flavour allow the country to produce large quantities of quality coffee. Traders and analysts said that with no other origin able to match these conditions, Colombia's coffee will eventually get more expensive.

Central America, prestigious but lacking high altitudes, is the best alternative, they say. "Colombia is considered top shelf and cream of the crop ... Buyers will have to pay higher premiums for Central American and Colombian coffee to get what they want," said Florida-based coffee analyst Shawn Hackett.

Beans from Costa Rica, Nicaragua and Guatemala would be options for roasters seeking to replace Colombian, although fungal roya disease has decimated crops in those countries, where it will take years for new trees to start producing.

Hackett said growth in the high-end coffee segment could increase competition for Colombian beans in as soon as three years.

When similar factors caused shortages of pickers in Brazil in the last five years, the world's top grower mechanised. But Colombia's mountainside farms, tricky to access on foot let alone with machines, rule out that solution.

Farmer-funded coffee researcher Cenicafe has studied everything from mechanisation and alternative varieties of trees to hand-held gadgets that can strip beans from branches faster to boost productivity, but none have proven viable.

Growers say cutting corners on quality is the only way volumes can be increased, by stripping all the fruit in one labor-saving sweep and separating ripe from unripe afterward.

Some large farms, now forced to do that, have to discard unripe beans or sell them locally since they fall short of Colombia's export standards. "It's a critical situation now. All the boys are going to the city. They don't want to work the land. There are no incentives," said farmer Conrado Antonio Marin, in Jardin, a town in Antioquia province, one of the biggest coffee regions.

He has hiked wages more than 50 per cent in three years but to little avail. He can find only two pickers and must join in himself to harvest his own 2.5-hectare farm.

It's a familiar story for Fredonia coffee buyer Juan Saul Parra, 32. "There are people with trees to produce 1,000 arrobas (11.5 tonnes), who harvest only 800 because they don't have anyone to pick it all," he said, sifting through a bean sample while a farmer awaited a price.

"As the years go by, this will get worse and worse."