Environmental, health and social externalities in Uganda's coffee value chain: the hidden cost of coffee

Global coffee demand rises by about 2.3% annually, intensifying environmental, health and social externalities, particularly in producing countries. There is limited understanding of the magnitude of these externalities in Uganda's coffee value chain. This study provides the first simultaneous quantification and monetisation of negative environmental, health and social externalities in Uganda's coffee value chain using integrated true cost accounting approaches. Life-cycle assessment, disability-adjusted life years and the living income benchmark were employed to quantify environmental, health and social externalities, respectively. The True Price methodology was used to monetise the environmental and social externalities, while the value of a statistical life year was applied to monetise health externalities. The total hidden costs were estimated at 3665 USD (range 3079–4383) per tonne of coffee, nearly 1.8 times the export price of 2000 USD per tonne. Environmental costs (1985 USD) were attributed to greenhouse gas emissions and soil erosion, social costs (1033 USD) were due to child labour and insufficient income among smallholder households and health costs (67 USD) were from pesticide exposure. Across the value chain stages, cultivation accounted for over half (2822 USD) of the total hidden costs. These findings indicate that the environmental, health and social impacts of Uganda's coffee value chain exceed its market value. Internalising these externalities would require substantial investments from value chain actors and policymakers, nearly double the current market value of coffee.