The history of coffee in El Salvador

Reforms in the country

In 1881 and 1882, however, the so-called Liberal Reforms were enacted, which dramatically changed land tenure in the country. One decree stated that "access to common lands is no longer a right and that private ownership of these lands could be obtained by growing specific crops" such as export crops. Another decree banned "vagrancy," so this newly created class of landless vagrants was suddenly forced to work for slave-like wages and in poor conditions on coffee, sugar, and cotton plantations. These reforms effectively stripped nearly half of El Salvador's population of their land, as indigenous communities in El Salvador typically farmed communal property and very few farmers held individual property titles for the land they worked.

Coffee barons

In 1895, General Tomás Regalado won the presidency. This position allowed the general and his family to eventually amass 6,000 hectares of plantation land divided into six different provinces. After the Regalado period, the coffee barons served as successive presidents for the next thirty-one years, extending coffee's dominance and building their own fortunes.

Decline in the price of coffee - unemployment

In the 1920s and 1930s, coffee exports accounted for only 90% of the country's total exports. But what seemed like a smart strategy during the boom years seemed foolish during the bust, and the global depression of the 1930s pushed El Salvador to the brink. As coffee prices fell to one-third of previous levels, coffee producers cut wages by half while others laid off workers. Coffee rotted in the fields while rural unemployment soared. Rural discontent turned to anger. For three days in January 1932, tens of thousands of peasants staged an open revolt in western El Salvador. Their actions were suppressed by bullets.

Thirty thousand peasants were killed in the worst massacre in El Salvador, La Matanza. As historian Thomas Anderson shows, La Matanza is an opportunity to understand "the whole political labyrinth of El Salvador." The combination of the strong grip of the coffee plantation class and the desperate rural proletariat proved as volatile in the 1970s and 1980s as it had been fifty years earlier.
But the coffee industry survived and prospered after the Great Depression. El Salvador became known as one of the most advanced coffee producers through the introduction of modern plantation technology and sophisticated coffee processing systems.

The elite divided into two factions

While descendants of Spanish families continued to control the land and production, Italian and English immigrants became involved in the coffee processing and export industries. Over time, the small number of family groups in the Salvadoran elite began to divide into two factions: the landed aristocracy, who held the low wage and plantation development model for El Salvador, and the modernized sector of coffee producers and exporters, who were making inroads into the global economy and seeking to industrialize and diversify the Salvadoran economy and their control over it. By the 1970s, El Salvador had become the fourth largest coffee exporter in the world, but neither the landed aristocracy nor the modernizing factions of the elite showed any interest in addressing the poverty and dislocation associated with the coffee trade.

The poor coffee picker

For small producers and workers, coffee was a way to survive - barely - and they lacked the power to force change in the industry. Over time, the rural peasantry turned into a rural proletariat, people working for wages rather than making a living from their crops.

In the sixties and seventies, thunderous discontent flared up again in rural areas. Progressive Catholic clergy, influenced by the progressive doctrine of liberation theology, began to operate in rural areas and encouraged rural workers to organize unions and self-help cooperatives. The Salvadoran elite, especially the coffee barons, opposed their efforts and formed various paramilitary vigilante groups or used the National Guard to violently suppress these movements. While many leaders were killed, others went underground and joined the growing leftist insurgency known as the Farabundo Marti National Liberation Front (FMLN). Fearing a communist domino effect in the region, the U.S. stepped up military aid and support in the late 1970s to counter the guerrillas.

Change of leadership

The United States also pushed a social reform agenda aimed at dividing popular support for the insurgents. Key to the agenda was agrarian reform: expropriation of large tracts of land, return of land to the peasantry, and support for agricultural cooperatives. Under pressure from the U.S. government, the Salvadoran government announced the first phase of the agrarian reform program. Virtually overnight, planters were declared owners of cooperatives. Despite this newly acquired land ownership, however, very little, if any, technical assistance, bank loans, or management training was provided to the former coffee pickers.

The Civil War...

The 1980land reform was a theft for the coffee barons, and they vehemently and violently opposed the measures. Although hundreds of coffee cooperatives were established by the land reform, the cost was high: hundreds of cooperators and two US reform experts were killed by a right-wing death squad. The violence reached such proportions that human rights activists launched a boycott against the "death squad" from El Salvador.

.... and its end

In the late 1980s, the modernizing sector of the Salvadoran elite, including manufacturers and exporters, wanted to expand their control over the Salvadoran economy and diversify their holdings. They joined other sectors in pressing for civil war negotiations. They knew the war had to end,so they could expand economic development and carry out their corporate globalization. In 1989, Alfredo Cristiani, a right-wing modernist candidate who was a prominent coffee farmer and banker, was elected president. In 1992, the government and the FMLN reached a UN-brokered peace agreement. The losses were catastrophic - seventy-five thousand people lost their lives during the twelve-year war - but the promise of a new era of peace and prosperity brought hope to the country.

Coffee as a solution to poverty

For a country recovering from war and facing overwhelming poverty, high foreign debt, low levels of education and other development challenges, coffee represented an opportunity to harvest a new kind of wealth - socially distributed wealth. Coffee still accounted for half of El Salvador's GDP (1988 data). In the 1990s, 78% of farms and 40% of the total area were in the hands of small producers. Furthermore, coffee farms accounted for most of the forested land in the second most forested country in the hemisphere, and coffee provided direct employment for 155,000 Salvadorans.

Conventional coffee market

Over the past fifteen years, the policy of repression had given way to civilian governments, but coffee producers faced a new challenge: the conventional coffee market. Declining world coffee prices over the past decade have forced the country's more than 80,000 small coffee producers and coffee pickers into desperation. Thousands have moved to the cities to find work - in the informal sector as street vendors and textile maquilas (sweat shops) - and live in squatter communities. Thousands more risked their lives traveling to Mexico and the United States in search of work. More than two million Salvadorans now live in the U.S., and the more than $2 billion a year they send home to join their families keeps the economy in their home country afloat.

The bleak outlook for families

For those who stayed, the outlook was bleak. In the coffee-producing provinces of Ahuachapan, Sonsonate, Santa Ana and La Libertad, UNICEF reports that nearly 30,000 families are suffering from hunger because of the coffee crisis. El Salvador's Ministry of Health documents that in one year, 4,000 children under the age of five whose parents were coffee producers became ill from malnutrition. Fifty-two of these children died.

Fair Trade

Although farmers face many challenges today, those farmers who are organized in Fair Trade cooperatives receive the best prices and technical assistance in the production, marketing and export of their coffee. In addition, because they belong to global networks of Fair Trade advocates and buyers, they have been able to benefit from development projects and other forms of support from government, NGO and faith-based development agencies. One Fair Trade cooperative is El Pinal, which was founded on land in La Libertad province expropriated by former Salvadoran President Pio Romero Bosque (1927-1931). Unlike many other coffee cooperatives in El Salvador, El Pinal was able to pay off its land debt to the banks. El Pinal used both the premium from the sale of its coffee and emergency funds from participating Fair Trade partners to build an elementary school, rebuild its homes from earthquake damage, and train members in leadership development.

Las Colinas

Another fair trade cooperative, located in the western province of Ahuachapan. Members of Las Colinas, one of the provinces most affected by past low coffee prices, often receive two to three times higher prices for their coffee than neighboring communities. The cooperative inherited a dry-processing mill and used its premiums to maintain, rebuild and upgrade infrastructure. An emergency medical fund allows the cooperative's health agents to keep a supply of essential medicines on hand and help pay for transportation to the local health clinic or hospital. In 2005, Equal Exchange made a donation of computers to the cooperative and members received training in computer programs and internet use.

Looking forward to better times

The first Fair Trade café, "Photo Café", opened today in San Salvador. The café sells coffee exclusively from two Fair Trade cooperatives: El Pinal and Las Colinas. Photos on the wall and brochures on the tables help educate Salvadorans about the plight of farmers and the importance of Fair Trade coffee. The café owners hope they can begin to influence the purchasing decisions of local Salvadorans while taking advantage of the growing number of foreign visitors coming to the country.

Fair Trade makes sense

Fair Trade has changed the lives of these farmers and others who participate in coffee cooperatives. The more Fair Trade coffee that can be sold in this country, the more opportunities can be provided to other farmers and the more it can flourish.