Archive for the ‘Direct Trade’ Category
Some Thoughts on Fair Trade
Wednesday, December 7th, 2011
A big part of our working year is spent looking for great coffees with a focus in East Africa, Central and South America. When assessing a coffee, its not just its representation in the cup that counts. We look for coffees that are produced with a mindfulness and care for the local surroundings and that are grown and processed in socially and environmentally responsible ways. As much of our coffee as possible is purchased directly from farmers. We work hard to build strong relationships with the farmers and workers we deal with and this helps us understand their communities, farming systems, ethics and the coffees they sell to us. It ensures the quality of our product as we choose farmers who are committed to supporting their local community, great conditions for the people working their farm, sustainable and ethical farming systems and delivering the best coffee cherries possible.
A common question we are asked is whether or not our coffees are fair trade. The short answer is no. We know that the coffees we source are fairly traded. In our view the fair trade system has definitely been integral to raising awareness of poverty issues in coffee growing (and other) countries and has had a positive impact on many communities around the world. It is a system that we believe began with an intent to be fair and equitable across the coffee world (largely in reaction to multinationals buying large amounts of coffee at very low prices). However, there are a number of core problems with fair trade which are of concern to us.
Fair trade works by guaranteeing a base or “fair trade” price for goods, aiming to protect producers should the market price of the product fall below a certain level. The price is set annually by the International Fair Trade Foundation. In 2011, the fair trade minimum price for Arabica coffee reached $1.65 USD per pound. This base price is all well and good, but in our view the across the board pricing does not allow for any differentiation between economic conditions in participating countries – for example a coffee farmer in El Salvador may have a higher cost of production than in Ethiopia to survive – and in our dialogues with coffee growing families, it has become clear that the fair trade price is simply not enough to sustain them. There are also environmental and quality issues associated with fair trade. Fair trade does not provide farmers with any incentive to produce quality coffee in an environmentally friendly or sustainable way. The emphasis is on harvesting beans quickly and getting a sale across the line so that the fair trade dollar can be paid through to the farmer quickly. It doesn’t encourage development of better systems and long term investment to create a strong local coffee industry, attracting higher prices for the community. The result is an inconsistent and sometimes unsustainable product.
When we are purchasing coffees directly from farmers, we pay prices that are well above the fair trade price. We also have an ongoing dialogue with the farming community about how we can work with them to help them grow environmentally sound coffees, attract hire prices and secure a better life for their community. If we are not purchasing directly from farmers, we purchase coffees through the Cup of Excellence programme (COE). COE is an award system that introducers roasters to farms, encourages farmers to adhere to strict quality parameters and pays qualifying farmers well in excess of the fair trade price. Farmers submit their coffees for sampling and each coffee is given a score. The coffees that score above 84 gain entry into that country’s COE Auction (typically one auction per country per year) where opening bids are set at $4.00 USD per pound. The opening bid price is well in excess of the fair trade price. COE encourages coffee producers and their communities to strive for excellence, with significant resulting benefits. COE may be seen as a one off “win” for farmers, but we believe that the system encourages long-term sustainable relationships with farmers. As such, many of the producers we deal with were introduced to us through the COE system and we hope to continue working with them and their communities to ensure we can continue to present some of the best coffees in the world to our customers.
Wednesday, December 7th, 2011
A big part of our working year is spent looking for great coffees with a focus in East Africa, Central and South America. When assessing a coffee, its not just its representation in the cup that counts. We look for coffees that are produced with a mindfulness and care for the local surroundings and that are grown and processed in socially and environmentally responsible ways. As much of our coffee as possible is purchased directly from farmers. We work hard to build strong relationships with the farmers and workers we deal with and this helps us understand their communities, farming systems, ethics and the coffees they sell to us. It ensures the quality of our product as we choose farmers who are committed to supporting their local community, great conditions for the people working their farm, sustainable and ethical farming systems and delivering the best coffee cherries possible.
A common question we are asked is whether or not our coffees are fair trade. The short answer is no. We know that the coffees we source are fairly traded. In our view the fair trade system has definitely been integral to raising awareness of poverty issues in coffee growing (and other) countries and has had a positive impact on many communities around the world. It is a system that we believe began with an intent to be fair and equitable across the coffee world (largely in reaction to multinationals buying large amounts of coffee at very low prices). However, there are a number of core problems with fair trade which are of concern to us.
Fair trade works by guaranteeing a base or “fair trade” price for goods, aiming to protect producers should the market price of the product fall below a certain level. The price is set annually by the International Fair Trade Foundation. In 2011, the fair trade minimum price for Arabica coffee reached $1.65 USD per pound. This base price is all well and good, but in our view the across the board pricing does not allow for any differentiation between economic conditions in participating countries – for example a coffee farmer in El Salvador may have a higher cost of production than in Ethiopia to survive – and in our dialogues with coffee growing families, it has become clear that the fair trade price is simply not enough to sustain them. There are also environmental and quality issues associated with fair trade. Fair trade does not provide farmers with any incentive to produce quality coffee in an environmentally friendly or sustainable way. The emphasis is on harvesting beans quickly and getting a sale across the line so that the fair trade dollar can be paid through to the farmer quickly. It doesn’t encourage development of better systems and long term investment to create a strong local coffee industry, attracting higher prices for the community. The result is an inconsistent and sometimes unsustainable product.
When we are purchasing coffees directly from farmers, we pay prices that are well above the fair trade price. We also have an ongoing dialogue with the farming community about how we can work with them to help them grow environmentally sound coffees, attract hire prices and secure a better life for their community. If we are not purchasing directly from farmers, we purchase coffees through the Cup of Excellence programme (COE). COE is an award system that introducers roasters to farms, encourages farmers to adhere to strict quality parameters and pays qualifying farmers well in excess of the fair trade price. Farmers submit their coffees for sampling and each coffee is given a score. The coffees that score above 84 gain entry into that country’s COE Auction (typically one auction per country per year) where opening bids are set at $4.00 USD per pound. The opening bid price is well in excess of the fair trade price. COE encourages coffee producers and their communities to strive for excellence, with significant resulting benefits. COE may be seen as a one off “win” for farmers, but we believe that the system encourages long-term sustainable relationships with farmers. As such, many of the producers we deal with were introduced to us through the COE system and we hope to continue working with them and their communities to ensure we can continue to present some of the best coffees in the world to our customers.