Quick Insight: making money from coffee waste
Or how by thinking differently we can turn a problem into an opportunity
Alternative uses for coffee waste might seem a niche topic, too small to be worth reading about. But the lessons we can take from this have much wider importance. They illustrate that while the sustainability transitions are partly about regulation and technology, they are also about thinking about challenges in a different way. And they are complex.
Most of what we read in relation to 'recycling' coffee waste relates to what happens to the disposable cups, and what we can do with the used coffee grounds. So, the end user part of the process.
But the bulk of the waste produced comes from upstream, from the processing of the coffee beans. It is estimated that each kg of coffee produced using the dry processing method generates 0.5 kg of coffee pulp and husk. This falls to 0.2 kg if the wet process is used, but then you have a lot more 'polluted' water to dispose of safely.
The good news is that coffee waste could make a good feedstock for the production of biogas, and we know that we will need more of this over time. The bad news is that it’s not just a case of putting the ‘waste’ into a biodigestor. Coffee farmers are going to need help, both technical and financial, if we are to turn this challenge into an opportunity.
Global coffee production delivers more than 23 million tons of waste every year. While some of this is still dumped, much of it is composted to produce fertiliser, a useful but rather low value by-product. But there are more innovative uses, including using it as a feedstock in biodigesters, and potentially as a raw material for the production of higher value nutraceuticals.
There is the obvious angle of enhancing the value of a crop (in this case coffee beans), by changing our thinking about what is 'waste'. But there is another angle - impact. According to Fairtrade 25 million smallholders produce 70-80 percent of the world’s coffee. Many of them live an almost subsistence existence, so helping to expand their revenue sources can help enhance the resilience of their communities. So a double win, but sadly (as is often the way in sustainable investing), not an easy one.
Agriculture is not only a major source of GHG emissions, it's also the main cause of biodiversity loss and land degradation. Plus, agriculture sits at the intersection of a number of UN Sustainable Development Goals (UN SDGs). Reforming agriculture is going to require massive social and economic change, and a lot of disruption - to the crops we grow, their production methods, to supply chains and to employment.
You can read more on this and many other sustainable finance topics on our blog website
