Fair Trade 101

Over the course of any given month, Chris and I and our employees have a lot of opportunities to meet directly with the people purchasing our coffee. We do demos @ supermarkets, we set up at farmer’s markets on the weekends, and we generally hang around at our new wholesale client’s cafes, wine shops (and fish markets: welcome to the ‘hood Metropolitan Seafood!!) getting to know their customers who are in turn the end user of our product.

Lately a lot of our customers have been asking me about Fair Trade, as almost all of our coffees ARE certified. Everyone has a vague idea of what Fair Trade is, essentially knowing that it’s something that is “good for the world” or “sustainable” and “cool” but not a lot of people know the real deal. It’s time everyone knows what’s up with Fair Trade!! I’m going to resurrect a post I made on our old blog when I was new to the coffee biz way back in 2007. Enjoy…

What is Fair Trade coffee?

Fair-trade coffee is coffee that is purchased from farmer cooperatives as opposed to large coffee plantations. Farmers are ensured at least $1.26 per pound of coffee – a rate at which a farmer can theoretically support a family of five with adequate nutrition, health care, and education. In comparison, the price that most farmers receive for a pound of coffee is around 60c, which is not always enough to cover the cost of production itself, let alone provide for the farmer and his/her families’ needs. The cooperatives receiving the extra money (in this case 66c per pound) decide how to spend the extra money, usually choosing to help farmers and their families with the above mentioned needs, build schools, purify water, grow food or convert conventional crops to organic. The entire operation is overseen and policed by a non-profit called the Fair Trade Labeling Organization, whose subsidiary TransFair USA runs the US branch of the company (note Transfair USA will officially change it’s name to Fair Trade USA in 2012).

Although the outspoken motive of fair-trade is to support individual farmers and communities, also embedded in its philosophy is environmental conservation and sustainable agriculture. Eighty-five percent of fair-trade coffee is organic, in contrast to conventional coffee, which uses pesticides and fertilizers, including DDT, that then contaminate local watersheds and can harm the health of workers. Conventional coffee is usually grown on large plantations with methods that cause erosion, deforestation, and loss of biodiversity (you can read more about this here).

What are the goals of Fair Trade?

-To improve the livelihoods and well-being of producers by improving market access, strengthening producer organizations, paying a fair price and providing continuity in the trading relationship.
-To promote development opportunities for disadvantaged producers, especially women and indigenous people, and to protect children from exploitation in the production process.
-To raise awareness among consumers about the negative effects on producers of international trade so that they exercise their purchasing power positively.
-To set an example of partnership in trade through dialogue, transparency and respect.
-To campaign for changes in the rules and practice of conventional international trade.
-To protect human rights by promoting social justice, sound environmental practices and economic security.

How does Fair Trade help farmers?

Fair Trade guarantees producers a fair price for their product (at least $1.26 per pound) which enables farmers to cover the costs of production, reinvest in their farms and meet their families basic needs including health care and education. Fair Trade creates direct links between producers and importers, bypassing various intermediaries who take a share of the profits. Fair Trade is not a charity, it is a market-based approach to increasing small farmer self-sufficiency and generating more resources for community development and environmental conservation.

In contrast, conventionally traded coffee is part of the larger “free trade” system, favoring larger producers and multinational corporations, often at the expense of local communities and the environment. Under conventional trade, coffee prices are determined by a volatile international market. The world market price often falls below a farmer’s cost of production and leaves farm families in a struggle for survival. Even when the world market price is relatively high (like now in 2011!), family farmers get a small fraction of that price, with the lion’s share of profits going to intermediaries.

Please think about buying Fair Trade the next time you are shopping. How we choose to spend our money here in the US really can help make a difference, even half a world away.


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