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Frequently Asked Questions About Fair Trade Coffee
General questions and answers about our campaign.
Coffee in the Global Economy
What role does coffee play in the global economy?
A: Coffee is the world's second most valuable traded commodity, behind
only petroleum. There are approximately 25 million farmers and coffee
workers in over 50 countries involved in producing coffee around the
world. Coffee was traditionally developed as a colonial cash crop,
planted by serfs or wage laborers in tropical climates on large
plantations of landowners for sale in colonial countries. Coffee
producers, like most agricultural workers around the world, are kept
in a cycle of poverty and debt by the current global economy designed
to exploit cheap labor and keep consumer prices low. An estimated 11
million hectares of the world's farmland are dedicated to coffee
cultivation. The largest producer and exporter is Brazil, followed by
Colombia, Vietnam, Indonesia, and Mexico. Around the globe, the annual
consumption of coffee has expanded to 12 billion pounds. For more
information about the history of Latin America and coffee, see
Coffee and Power by Jeffrey Paige (in bibliography)
What role does coffee play in the US economy?
A: Coffee is the US's largest food import and second most valuable commodity only after oil. According to the International Coffee Organization, the US imported 2.72 billion pounds of coffee from September 2001 to September 2002. The US primarily purchases coffee from Brazil, Colombia, Mexico, Guatemala, and Vietnam. The U.S. also buys coffee from Indonesia, Costa Rica, Peru, El Salvador, Ecuador, Venezuela, Honduras, Uganda, Thailand, Nicaragua, India, and Papua New Guinea. In the U.S. alone, over 130 million consumers are coffee drinkers. In recent years, new cafés have been opening at an explosive rate, making specialty coffee mainstream and increasing profit margins for specialty coffee roasters and retailers. The Specialty Coffee Association of America estimated that there are 10,000 coffee cafes and 2,500 specialty stores selling coffee. Chains represent 30% of all coffee retail
stores, but the majority remain in the hands of independent owners or
small family businesses.
How are coffee prices currently set?
A: Coffee prices are set according to the New York "C" Contract
market. The price of coffee fluctuates wildly in this speculative
economy, generally hovering around fifty cents per pound. Most coffee is traded by speculators in New York, who trade approximately 8-10 times the
amount of actual coffee produced each year. The single most
influential factor in world coffee prices is the weather in
Brazil. Droughts and frosts portend shortages of coffee and the price
increases.
Specialty coffee is often imported at a negotiated price over the C
market, which is considered a 'quality premium'. Most of those
premiums never reach the coffee farmer, but rather stay in the hands
of the exporter. This creates a disincentive for farmers to increase
their quality, as they do not receive the direct benefits of increased
investment in producing better coffee.
What is the commodity chain of the coffee industry?
A: Coffee is an extremely powerful commodity, reigning as the world's
most heavily traded product, behind petroleum, and the largest food
import of the United States. The global commodity chain for coffee
involves a string of producers, middlemen, exporters, importers,
roasters, and retailers before reaching the consumer.
Coffee is a vital source of export for many of the developing
countries that grow it. Some 20 million families in 50 countries now
work directly in the cultivation of coffee; an estimated 11 million
hectares of the world's farmland are dedicated to coffee
cultivation. Arabica and Robusta are the two principle species of
coffee harvested today. Approximately 70% of the world's production is
the Arabica bean, used for higher-grade and specialty coffees, and 80%
of this bean comes from Latin America. Robusta is grown primarily in
Africa and Asia.
Most small farmers sell directly to middlemen exporters who are
commonly referred to as coyotes. These coyotes are known to take
advantage of small farmers, paying them below market price for their
harvests and keeping a high percentage for themselves. In contrast,
large coffee estate owners usually process and export their own
harvests that are sold at the prices set by the New York Coffee
Exchange. However, extremely low wages ($2-3/day) and poor working
conditions for farmworkers characterize coffee plantation jobs.
Importers purchase green coffee from established exporters and large
plantation owners in producing countries. Only those importers in the
specialty coffee segment buy directly from the small farmer
cooperatives. Importers provide a crucial service to roasters who do
not have the capital resources to obtain quality green coffee from
around the world. Importers bring in large container loads and hold
inventory, selling gradually through numerous small orders. Since many
roasters rely on this service, importers wield a great deal of
influence over the types of green coffee that are sold in the US.
There are approximately 1200 roasters in the US today. Large roasters
usually have one blend of recipes and sell to large retailers - the
Big Three (Kraft, which owns Maxwell House and Sanka, owned by Philip
Morris; Procter & Gamble, which owns Folgers and Millstone; and
Nestle) maintain over 60% of total green bean volume. Microroasters,
or those who roast up to 500 bags of coffee a year, offer the product
we know as specialty coffee. Most roasters buy coffee from importers
in small, frequent purchases. Roasters have the highest profit margin
in the value chain, thus making them an important link in the
commodity chain.
Retailers usually purchase packaged coffee from roasters, although an
increasing number of retailers are also roasting their own beans for
sale. The Specialty Coffee Association of America estimated that there
are 10,000 cafes and 2,500 specialty stores selling coffee. Chains
represent approximately 30% of all coffee retail stores. However,
supermarkets and traditional retail chains are still the primary
channel for both specialty coffee and non-specialty coffee, and they
hold about 60% of marketshare of total coffee sales. Around the globe,
the annual consumption of coffee is 12 billion pounds and in the
U.S. alone, over 130 million consumers are coffee drinkers.
Coffee Production and Labor
What is the economic situation of small farmers
in the coffee industry?
A: Coffee is produced both on large plantations and by small
farmers. Typically, Fair Trade farmers cultivate less than 3 hectares
of coffee and harvest 1,000-3,000 pounds of unroasted coffee a
year. Small farmers are perhaps more aptly defined by those farmers
who rely principally on their own families' labor. This makes Fair
Trade potentially representative of an estimated 75% of all coffee
farmers. Many coffee farmers receive prices for their harvest that can
be less than the costs of production, forcing them into a cycle of
poverty and debt. They are often forced to sell to middlemen who pay
them half the market price, generally between $.30-.50 per
pound. Family farmers usually bring in a cash income of $500-$1,000 a
year for their coffee.
What are the labor problems and working conditions
in the coffee industry?
A: Conditions for coffee workers on large plantations varies widely,
but most are paid the equivalent to sweatshop wages and toil under
abysmal working conditions. In Guatemala for example, coffee pickers
have to pick a 100-pound quota in order to get the minimum wage of
less than $3/day. A recent study of plantations in Guatemala showed
that over half of all coffee pickers don't receive the minimum wage,
in violation of Guatemalan labor laws. Workers interviewed in the
study were also subject to forced overtime without compensation, and
most often did not receive their legally-mandated employee
benefits. The total average income reported was Quetzales 1006
($127.37/month). According to 1998 data published by Guatemala's
National Institute of Statistics, the cost of the Basic Food Basket
for a family of five was 1353.86 Quetzales per month ($171.37 @7.90
exchange rate). The Basket of Goods and Services (including food,
education, healthcare, clothing, and transportation) was Q2470.55
($312.72).
Because of this situation, many coffee workers bring their children to
help them in the fields in order to pick the daily quota. These child
workers are not officially employed and therefore not subject to labor
protections. While children in most rural families work at an earlier
age than urban children, a February 4 investigative report by
ABC-affiliate KGO television in San Francisco revealed children as
young as 6 or 8 years old at work in the fields. We believe that the
best way to prevent child labor in the fields is to pay workers a
living wage.
Working conditions on these plantations are harsh; as migrant
farmworkers, many workers sleep in temporary shelters with rows of
bunk beds. Many times they cook, wash and bathe from the same water
source. The study of coffee plantations in Guatemala revealed that
only 13% of coffee workers have completed their primary
education. Most were not provided with legally-mandated adequate
health care.
Most coffee workers, like many agricultural workers around the world,
are not guaranteed their basic labor rights including the right to
organize. The rural nature of farmwork makes them especially
vulnerable to threats and coercion, as plantation owners can take
advantage of their control over the workforce to keep them from
organizing into unions to demand their rights. Many countries have
adequate labor laws such as minimum wage, mandated health and safety
requirements, and freedom to form a union, but these rights are
usually not enforced.
Coffee and the Environment
What are some of the environmental issues, like
pesticides and biodiversity, with coffee production?
A: Coffee farming originally developed in Africa as an understory crop
beneath diverse shade trees that provided habitat for wildlife such as
birds, butterflies, insects, and animals. Traditional farmers usually
use sustainable agricultural techniques including composting coffee
pulp, rotating crops, and not applying expensive chemicals and
fertilizers. In addition, they usually cultivate food alongside cash
crops, and intercrop other plants such as banana and nut trees which
provide food security as well as additional sources of income.
In the 1970s and 80s, as part of the general shift to 'technified
agriculture' during the so-called Green Revolution, the US Agency for
International Development and other groups gave $80 million dollars
for plantations in Central America to replace traditional shade grown
farming techniques with 'sun cultivation' techniques in order to
increase yields. This resulted in the destruction of vast forests and
biodiversity of over 1.1 million hectares. 'Sun cultivated' coffee
involves the cutting down of trees, monocropping, and the input of
chemical fertilizers and pesticides. This type of industrial coffee
farming leads to severe environmental problems, such as pesticide
pollution, deforestation and the extinction of songbirds through
habitat destruction. The Smithsonian Institute has identified
industrial coffee production as one of the major threats to songbirds
in the hemisphere due to deforestation - the birds no longer have a
habitat in which to live. Soil and water sources continue to be
severely degraded by many coffee farms, as coffee pulp is often dumped
into streams. In addition to the harmful effects on the environment
caused by the use of chemical pesticides and herbicides in coffee
cultivation, workers are also at risk of drinking contaminated water
and being poisoned by pesticides.
For these reasons, many bird, tree, and biodiversity conservationists
have developed standards for promoting "shade-grown" or
"bird-friendly" certified coffee -- that is, coffee grown under a
canopy of diverse trees that provide habitat to birds. The Smithsonian
Migratory Bird Center, as well as Rainforest Alliance and the Seattle
Audubon Society, all promote various labels of coffee that promote
tree and bird conserving farming practices. In addition, many
consumers are committed to purchasing organic coffee in order to
promote sustainable farming techniques in poor countries.
For more information, see the Proceedings of the First Sustainable
Coffee Congress by the Smithsonian Institute, which is a valuable
resource on all issues of sustainability.
How does Fair Trade address environmental issues such
as shade grown and organic?
A: About 85% of Fair Trade Certified coffee is shade grown and either
passive or certified organic. Over half of the certified organic
coffee is produced by Fair Trade cooperatives, but unless the coffee
is Fair Trade Certified, there is no guarantee that the farmer
received the benefit. Certified organic coffee in the Fair Trade
market receive a $.15 premium per pound. Typically, small farmers have
never had the money to finance cutting down of the trees or purchase
large amounts of chemical fertilizers and pesticides. Small farmers
have traditionally passed on sustainable farming techniques to their
children. We believe that small farmers are the best stewards of the
land, with the highest interest in living in and passing on land with
healthy soil free from harmful pesticides to their children. Paying
farmers a fair wage with incentives for ecological practices is the
best way to encourage sustainable farming. Fair Trade helps guarantee
that the benefits of organic farming techniques reach the farmer as
well as the consumer and the environment.
We support the shade grown/bird-friendly as well as organic labeling
movements as an important tool for consumers to make responsible
choices about environmental conservation, and support the double- or
triple-labeling of coffee. Most consumers who believe in supporting
living wages for farmers also support sustainable farming practices
that promote environmental conservation.
How does the Fair Trade certification process differ
from organic and shade grown certifications?
A: Organic, Shade Grown, and Bird-Friendly certification labels have
contributed important and valuable efforts to promoting sustainable
agriculture techniques that benefit farmers and the
environment. However, they do not carry the encompassing attributes of
the Fair Trade Certification process. Organic coffee is certified
according to strict legal criteria. There are a number of different
certifying agencies (QAI, OCIA) that all certify according to the same
California Organic Foods Act an in accordance with the standards of
the International Federation of Organic Agricultural Movements
(IFOAM). Shade coffee (bird-friendly) is currently certified by
several groups (Rainforest Alliance, Seattle Audubon Society,
Smithsonian Institute) but they work with slightly different criteria
and do not have comprehensive monitoring procedures. Of these, the
Smithsonian Institute has the strongest and most scientifically-based
criteria and the best monitoring capability. Fair Trade Certification
works with a ten year old comprehensive system of monitoring according
to international standards.
Most (85%) Fair Trade Certified coffee is organic and shade grown, and
most Shade and Organic coffee comes from farms that are organized as
part of the Fair Trade network. Unfortunately, most organic or shade
grown coffee is not Fair Trade; you still have to look for the Fair
Trade Certified label to know if the farmer got a fair price.
Notably, unlike organic certification, all Fair Trade coffee
monitoring and certification costs are paid by the roasters in the
consuming countries, not the farmers.
In sum, we believe Fair Trade, Shade/Bird Friendly and Organic
labeling initiatives to be symbiotic, because what is good for the
workers is good for trees, birds, and our shared environment. Many
consumers are looking for coffee that is multiply certified; labor and
ecological standards overlap and are mutually beneficial.
The History of Fair Trade
How did the concept of Fair Trade originate?
A: The Fair Trade movement began in the late 1950s as alternative
trade organizations (ATOs) emerged in Europe and the US to promote
grassroots development through direct, equitable trade. These ATOs
bought directly from Third World producers, eliminating the middlemen,
and paid the producers a fair price while providing assistance in
developing trading experience and market contacts. Such experiences
helped producers raise their incomes while reducing their dependency
on commercial middlemen. These first ATOs were primarily "Third World
shops" which dealt mainly in handicrafts. Today, there are 3,000 of
these shops in Europe organized in the Network of European World
Shops, and about 100 in the US, organized in the Fair Trade
Federation.
How was the concept of Fair Trade Certification developed?
A: The first Fair Trade certification initiative, called Max Havelaar,
was proposed in Holland in 1988. It marked an important departure from
the ATO model. The Fair Trade seal was offered to mainstream coffee
roasters who were willing to trade even a fraction of their total
volume on Fair Trade terms. By bringing in larger coffee roasters and
pushing Fair Trade into mainstream supermarkets, this seal exposed
many more consumers to the benefits of Fair Trade coffee and greatly
increased the number of farmers who benefit from Fair Trade.
After the Fair Trade seal demonstrated itself as a viable marketing
concept, several groups from other countries in Europe adopted the
initiative, many under the name of TransFair. However, for most of
their history, the Fair Trade labeling organizations remained a
collection of independent, autonomous, nationally based initiatives
that shared criteria and worked with the same farmers, but pursued
common goals with different strategies. There are currently Fair Trade
Certification seals in 17 different importing countries.
How did the Fairtrade Labeling Organizations international originate?
A: In 1997, Fair Trade labelers formed an international umbrella group
called Fair Trade Labeling Organizations (FLO) International. The
17-member organization follows a set criteria which defines Fair Trade
for each product certified under the Fair Trade system, including
coffee, tea, cocoa, sugar, honey, bananas and orange juice. For each
commodity, there is a shared International Fair Trade Registry of
farmers who have undergone a formal application process and have been
approved to sell to the Fair Trade market. Monitoring and
certification systems are maintained by FLO, which has field monitors
in each producer region or country who annually visit all of the
producer coops. Each member of FLO contributes to international
monitoring costs with its annual dues.
How did Fair Trade coffee in the US get started?
A: In 1986, Equal Exchange was established to import Nicaraguan coffee
as an expression of solidarity with the people and revolution of
Nicaragua, after the Reagan administration imposed an unfair trade
embargo. Equal Exchange became the only ATO in the US to focus
exclusively on Fair Trade coffee, trading according to the
international standards before there was a monitoring agency in the
US. In the fourteen years since its inception, Equal Exchange has
built a small but important niche for Fair Trade coffee, earning the
respect and recognition of the specialty coffee industry and helping
many farmers to keep their land during the low ebbs in the world
coffee market. Other companies such as Peace Coffee in Minneapolis,
Zapatista Coffee in Denver, Café Mam in Oregon, Café Campesino
in Georgia, and Dean's Beans in Massachusetts have also been active
promoting fair prices for farmers over the last five years, as well as
promoting education about the coffee industry and the need for Fair
Trade.
How did Fair Trade Certification in the US get started?
A: TransFair USA is the only FLO-affiliated, non-profit Fair Trade
certification organization in the United States. TransFair USA was
founded in 1996, but due to lack of funding was stagnant until 1998,
when it incorporated in Oakland under the leadership of longtime
coffee farmer advocate Paul Rice. Initially, the organization focused
on certifying coffee importers who were willing to trade according to
Fair Trade criteria. In 1999, that focus shifted to roasters. In 1999
they focused most of their energies on Bay Area companies, but many
socially responsible roasters across the nation have become licensees,
especially after the April 2000 SCAA conference where TransFair
brought producers from a dozen different Fair Trade cooperatives to
show their product. In the fall of 2000 their focus is on Boston and
the greater Northeast. As of mid-2000, there were over 50 importers
and roasters licensed to sell Fair Trade coffee with the TransFair USA
label. In addition, TransFair is active around promotion and consumer
education around Fair Trade coffee. See www.transfairusa.org for more
information.
Fair Trade Criteria and Monitoring
What are the Fairtrade
Labeling Organizations (FLO) criteria for roasters and
importers?
A: Any coffee roaster that complies with the following conditions can
apply for the right to use of one of the Fair Trade Labels of
FLO-International.
- The purchasing price must have been fixed in accordance with
the conditions established for this effect by FLO-International:
- Guaranteed floor price of $1.26 per pound for washed arabica.
- For Arabicas the New York "C" market shall be the basis
of calculation. The price shall be established in US$-cents per pound,
plus or minus the prevailing differential for the relevant quality,
basis F.O.B. origin, net shipped weight. Over the established prices,
there shall be a fixed premium of 5 US$-cents per pound.
- For certified organic or biological coffee with officially
recognized certification, that will be sold as such, an additional
premium of 15 US$-cents per pound green coffee will be due, on top of
the FLO-International price.
- The roaster/buyer is obliged to facilitate the coffee producers
access to credit-facilities at the beginning of the harvest season, up
to 60% of the value of the contracted coffee at Fair Trade conditions,
at regular international interest rates. The credit will be cancelled
upon shipment of the coffee.
- Producers and roasters/buyers depend on reliability and
continuity. For that reason, relations between both should be based on
long term contracts (1 to 10 years).
The floor price of the Fair Trade criteria acts as a safety net,
protecting small farmers when fluctuating market prices fall extremely
low. Currently, the floor price for conventionally grown Arabica beans
is $1.26/pound and $1.41/pound if the coffee is certified
organic. When the market price is above the floor price, as it was
during the 1994-98 period, the Fair Trade price is an additional
$0.05/pound premium above normal market price. Therefore, the Fair
Trade floor price is most relevant in times like the present, when the
world market price hovers around $0.85/pound (meaning that most small
farmers are only getting $0.20-0.40/pound). The Fair Trade floor
prices were determined after considerable field research into
production and living costs in various coffee-growing countries.
Negotiation in 1988 between European Fair Trade leaders, farmer
representatives and the industry established the initial floor prices.
The Fair Trade criteria around credit are especially important for
small farmers. Without access to credit during the "lean months"
between harvests, small farmers often are forced to sell the future
rights to their harvests to local middlemen at extremely low prices in
exchange for some cash up front. At harvest time, the farmers are not
allowed to pay off the middlemen with cash - they must hand over the
coffee. So without access to credit, many farmers would not be able to
take advantage of the opportunity to sell at Fair Trade prices. This
is why credit is built into the Fair Trade criteria as an obligation
of the importer.
What are the Fairtrade Labeling Organizations
criteria for producers?
A: FLO maintains a Coffee Producers Registry that is open to
associations of small farmers who meet several criteria that can be
summed up in the following way. They have to be poor; only small
farmers who are not dependent on hired labor, not plantations, are
represented. And they have to be democratically organized as small
farmer associations that are independent and transparent. Representatives
from FLO annually inspect Fair Trade farms in producing countries.
The exact FLO criteria for Producers are the following:
- the majority of the members of the organization are small
scale producers of coffee. By small producers are understood those
that are not structurally dependent on hired labor, managing their
farm mainly with their own and their family's labor-force;
- the organization is independent and democratically controlled by
its members. This means that the members of the organizations
participate in the decision-making process which determines the
general strategy of their organization, including decisions related to
the destiny of the additional resources which result from operations
in the framework of this agreement;
- administrative transparency and effective control by the members
and its Board over the management is secured, minimizing the risk of
fraud and offering members the necessary instruments to be able to act
adequately in case of fraud;
- the philosophy motivating the organization is based on the
concept and practice of solidarity;
- no form of political, racial, religious or sexual discrimination
is practiced;
- the organization is statutarily open to new members;
- the organization is politically independent, and there are
sufficient guarantees that the organization will not become the
instrument of any political party or interest;
- the organization shares with the FLO-International and with the
other organizations inscribed in the Producers' Register the following
principles and general objectives:
- integral economic development, concentrating on improvement
of production techniques and diversification of the production, in
order to diminish dependency on one single product as a cash crop;
- integral organizational development, improving the managerial and
administrative capacity of the actual and future leadership of the
organization and ensuring full participation of the members in the
definition of strategies and the use of extra income resulting from
fair trade;
- integral social development, for instance through health care and
educational programs, improvement of housing and water supply, thus
creating better living conditions for the members and their families
and the communities they live in;
- sustainable development strategies, applying production
techniques which respect the specific ecosystems and contribute to the
conservation and a sustainable use of natural resources, in order to
avoid as much as possible - or even totally - the use of chemical
inputs;
- integral human participation, offering especially women the
opportunity to play a more active role in the development process and
in the decision making process and management of the organization;
- improvement of the quality of the products as a strategic
requirement for the small producers to defend themselves on both the
Fair Trade Market and the regular market.
Logically, it is necessary that the quality of the coffee offered for
exportation complies with the minimum quality standards as required by
the different markets, and the organization must count with the
management capacity to effectively export the coffee and act as a
reliable commercial partner.
There are no criteria made for farm practices that the Fair Trade
farmers must follow, even though Fair Trade standards explicitly
support the development of organic agriculture and environmental
protection. At the Fair Trade Producers' Assembly in June 1997, the
producer groups themselves proposed a set of environmental
standards. These standards included the use of leguminous trees,
cultivation of timber species on the coffee farm, and
windbreaks. These producer-derived indicators emphasize the awareness
of "shade" as a beneficial farm practice, decreasing the likelihood
that farmers will transfer to "sun" grown coffee as they increase
their profits.
How does the certification process work?
A: As a member of the international Fair Trade network, TransFairUSA
is responsible for monitoring the paper trail from crop to cup to
ensure Fair Trade practices were followed throughout.
Producers
FLO maintains a Coffee Producers Registry that is open to associations
of small farmers as detailed above. FLO maintains field monitors in
countries and regions of origin, and makes annual visits to ensure
producer compliance with the Fair Trade criteria. The majority of
cooperatives fulfill or surpass the requirements of FLO's criteria
wholeheartedly. If producer cooperatives are found not in compliance,
they can be put on probation for a period to allow for improvement,
and in rare cases, dismissed from the list for serious violations.
Importers and Roasters
In the U.S., coffee importers and roasters must sign a licensing
agreement with TransFair USA in order to sell Fair Trade Certified
coffee using TransFair's trademarked seal on their
products. TransFair's Monitoring Department handles the US side of the
coffee trail by monitoring licensee paperwork, including sales
receipts and tracking numbers. Roasters must pay a licensing fee of 10
cents per pound to TransFair to ensure the sustainability of the
system, and to ensure that costs for certification are born in the
North rather than by the farmers.
Coffee Industry's Code of Conduct
Does the Fair Trade system work with large plantations?
A: Fair Trade is fundamentally focused on the small farmer, the
producer of the great majority of the world's coffee. Therefore, it
cannot address all of the social inequities associated with coffee
production around the world. As noted earlier, by deliberately
excluding plantations from the Fair Trade coffee market, the movement
does little to improve the lot of landless farmworkers employed on
those estates.
In contrast, in the case of tea and bananas, two largely
plantation-grown crops, Fair Traders have developed criteria that
address wages, living and working conditions of farmworkers, the right
to organize, and even mechanisms for profit-sharing. Fair Trade
inspectors report that monitoring and verification of fulfillment of
these criteria for large estates are more challenging tasks than with
small farmer cooperatives. Nevertheless, Fair Trade labelers made a
political decision to engage the large-estate sector in the case of
these two commodities. However, there has been contention involving
bringing plantation grown coffee into the scene, because of the
importance of the issue of land reform.
The Fair Trade coffee market is still too small to support both small
farmers and plantations. Presently, less than half the total
production volume of the small farmers on the International Fair Trade
Register is sold at Fair Trade terms because worldwide demand is still
too small to absorb it all. Bringing plantation grown coffee into the
Fair Trade market would further dilute the position of the small
holders. Therefore, any discussion of opening Fair Trade markets to
estate owners (and farmworkers) should be postponed until the market
grows large enough to absorb them without undermining the position of
the small farmer cooperatives.
Is there a Code of Conduct for the treatment of
workers on large plantations?
A: In lieu of developing Fair Trade criteria for plantation grown
coffee, some Fair Trade leaders in Europe are promoting the
development of a Code of Conduct to address the industry's sourcing
practices and, in particular, the issues of wages and working
conditions on large coffee estates. In July 1999, the European Fair
Trade Association issued an open invitation to consumer and religious
organizations across Europe to join them in a campaign to pressure the
European Coffee Federation to implement a Code of Conduct or
"Guidelines for Ethical Trading". A television documentary exploring
the deplorable conditions on Guatemalan coffee estates sparked a
massive response to this invitation. The European Coffee Federation,
representing the large European roasters and importers, responded by
discussing the subject of responsible business in their 1999 annual
meeting. Global Exchange has agreed to be the US partner in this
international effort, and is looking for other labor advocates
interested in participating in this effort.
So far, the only effort in this direction in the U.S. has been
Starbucks' 1995 Framework for action for sourcing coffee in Guatemala,
which it only half-heartedly implemented after consumer pressure
(coordinated by the US/Guatemala Labor Exchange, now US/LEAP) was
applied. Global Exchange is maintaining pressure on Starbucks,
demanding that they implement their Framework for Action plan. The
rest of the U.S. coffee industry has yet to seriously look at Sourcing
Guidelines or a Code of Conduct that effectively addresses the issues
of wages, working conditions and organizing rights on plantations.
The Fair Trade Certified Coffee
Campaign
Why did Global Exchange decide to start a Fair Trade
coffee campaign?
A: Because coffee is so widely traded and consumed, it has an immense
impact on the economic well-being of people in poor countries. For the
same reason, it also offers one of the most promising avenues for
bringing about positive change. Global Exchange believes that as we
criticize free trade and corporate globalization for its lack of
democracy and exploitation of poor people around the world, we need to
promote our own vision of a just global trade system based on economic
justice. In our work against sweatshops, we have struggled for years
with the need for a comprehensive system of monitoring of wages and
factory conditions that doesn't yet exist for garments as it does for
coffee. With the inception of TransFair USA, Fair Trade Coffee
certification became the first commodity where an independent
monitoring system could track and verify that Fair Trade criteria had
been met. We have been involved for ten years in promoting Fair Trade
through our craft stores in San Francisco and Berkeley. Recognizing an
alternative to free trade in Fair Trade Certified coffee, Global
Exchange initiated a campaign in the summer of 1999.
What is the history of the Fair Trade coffee movement?
A: Global Exchange began spearheading a campaign to promote Fair Trade
coffee in the summer of 1999. During the summer we focused our
campaign on our local Bay Area. We organized a coalition of interested
human rights, environmental, church, social justice, and student
organizations that believed in the model of Fair Trade and wanted to
help promote living wages for farmers. We outreached to the local
press and generated stories about Fair Trade in the Oakland
Tribune, San Francisco Chronicle, Contra Costa Times, San Francisco
Examiner, and San Jose Mercury News about Fair Trade
coffee. We helped to host Santiago Rivera, a farmer from San
Francisco's Sister City of Estelí, Nicaragua, for an event with San
Francisco Supervisor and living wage advocate Tom Ammiano. We worked
with San Francisco, Berkeley, and Oakland city councils to be the first
governments in the country to offer Fair Trade Certified purchasing restrictions.
We increased the retail outlets that offer Fair Trade Certified coffee
from just 4 to over 100 in just a few months! Our volunteers set up
informational tables at many local events, hosted speakers on Fair
Trade coffee at local schools and churches, and brought awareness to
the need to purchase Fair Trade to a critical mass of people in the
Bay Area.
In the fall of 1999 we began sowing the seeds for our nationwide
campaign focusing on helping community activists and college students
coordinate Fair Trade coffee campaigns on their campuses. We now have
a network of over 50 communities,
predominantly colleges, that are organizing educational outreach and
campaigning to promote Fair Trade coffee and purchasing restrictions
locally. Students at schools including Ohio University, Portland
State, University of Chicago, Tulane, and Columbia are working to get
sweatshop coffee off their campuses and replace it with Fair Trade
Certified coffee, and students at UC Davis, College of the Atlantic,
and SUNY Binghamton have already been successful. United Students
Against Sweatshops, the Student Alliance to Reform Corporations, and
student environmental organizations have participated in Fair Trade
Certified coffee activities on their campuses, identifying it as an
important tool towards decorporatizing our universities and greening
our campuses. In addition, we continue to work with churches,
environmental groups, unions, and other social justice communities to
promote Fair Trade for farmers. We have contacts in your city and an Action Kit full of tools to get started!
What is the history of the Starbucks campaign?
A: In the spring of 2000 we turned our sights towards
Starbucks with the plan of pressuring them
to offer their customers the choice to buy Fair Trade coffee at all of
their stores across the country. Starbucks is the largest retailer of
specialty coffee, owning a fifth of all cafes nationwide. In November,
1999, Global Exchange approached then Starbucks CEO Howard Schultz,
and requested that Starbucks buy Fair Trade Certified coffee. We then
organized several peaceful demonstrations promoting Fair Trade in
front of Starbucks in Seattle that same month. Starbucks was initially
very hesitant, alleging low bean quality and insufficient consumer
demand. We then initiated a massive letter writing campaign involving
citizens across the nation, writing as consumers of Starbucks
demanding they carry Fair Trade coffee.
In February, 2000, an investigative report by ABC-affiliate KGO in San
Francisco exposed child labor and incredibly low wages in plantations
in Guatemala, some of which sell coffee to Starbucks. On February 4th
we organized a local protest as a result. On February 14th we
petitioned stockholders at their Annual General Meeting in Seattle to
respond to consumer demand and fairness and offer Fair Trade Certified
coffee. In a meeting we had that day with Starbucks officials, they
stated that they would not yet commit to doing so. That week,
Starbucks announced a one-time shipment of 75,000 pounds of Fair Trade
coffee as a sign that they were aware of the demand. We responded that
for a company the size of Starbucks, this represented a "Drop in the
Cup," an average of about 30 pounds per store - and that the coffee
was not certified! We quickly dismissed this move in the media as an
obvious public relations ploy, because this tiny token amount is only
enough for about 30 pounds per store!
We then circulated an Open Letter, signed by 84 student,
environmental, church, and social justice organizations, asking
Starbucks to pay farmers a living wage and offer them the choice to
buy Fair Trade Certified coffee. We helped organize 30 demonstrations
to be held on April 13 across the country at Starbucks shops, with a
large base of activists committed to helping farmers earn a living
wage. Over 500 concerned people faxed in letters to Starbucks from our
website, and hundreds more sent in postcards asking the giant retailer
to offer Fair Trade coffee.
Three days before the launch of our campaign on April 13, Starbucks
capitulated to our demands and announced an agreement with
TransFairUSA to begin offering Fair Trade Certified coffee at all of
its stores nationwide with a launch date of October 4. They will also
be developing educational materials including posters, brochures,
packaging, and training for coffee bar workers, so millions of
customers will have the chance to learn about the benefits of Fair
Trade. This is a huge victory for farmers whose incomes will triple,
as hundreds more farmers will be able to sell their coffee at Fair
Trade prices. It is also an importance victory for the corporate
accountability movement. Starbucks' quick capitulation in the face of
nationwide protests illustrates that grassroots organizing and
education can indeed bring about major results. Starbucks has agreed
to offer the coffee in whole bean form only, and we will be pressuring
them to offer it in brewed coffees and espresso drinks this fall when
the beans are on the shelves. See our news
section for more details of the history of the Starbucks campaign.
What is your relationship with the Specialty Coffee
Association of America?
A: From April 14-18, 2000, we attended the Specialty Coffee
Association of America, titled "Quality, Sustainability, and Social
Responsibility." Fair Trade and discussions of fairness and
sustainability played a major role in the conference, held in San
Francisco. After the conference, we have been working with the SCAA to
develop a workplan for their newly created Fair Trade Working
Group. We have identified key areas in which the trade association, in
an historic move, can help to play a leadership role in promoting Fair
Trade amongst its members, including officially endorsing Fair Trade
Certification, educating its members through trade publications,
assisting in research needs, and helping to channel funding resources
for product quality improvement to Fair Trade cooperatives.
Is there enough consumer demand for Fair Trade coffee?
A: According to the 1998 Cone/Roper benchmark study, 78% percent of
consumers would rather purchase a product associated with a cause
about which they believe. 54% say that they would pay more for a
product that supports their cause. TransFair's 1997 consumer study
revealed that 49% of specialty coffee drinkers surveyed said they
would buy Fair Trade coffee. In the post-WTO climate, more and more
people are demanding Fair Trade products. Most people in this country
would rather buy a cup of coffee picked under fair trade conditions
than sweatshop labor conditions.
What You Can Do
Be sure to check out our Action Kit
which is full of ideas and resources.
What can any community organization do to support Fair Trade?
A: Help start a campaign in your community that will highlight the
importance of paying farmers a living wage. Distribute educational
leaflets and local events and local cafés, particularly ones that
might be interested in offering Fair Trade coffee. Send a letter to
local roasters and cafés from your organizational letterhead asking
them to talk with TransFair about offering Fair Trade coffee. Make
sure that your local community serves Fair Trade Certified coffee at
community events. Encourage your community organization to purchase
Fair Trade products for fundraisers and organizational gifts. Check
out our Action Pack for more ideas.
What role can campus activists play?
A: Fair Trade provides a sustainable alternative to corporate free
trade practices. Bringing Fair Trade Certified coffee to our campuses
to replace corporate coffee is an important step towards replacing
environmentally & socially exploitative product sourcing with
sustainable development practices and decorporatizing our
universities. It is a visible and achievable goal that can be
incorporated into current campaigns, used to recruit new activists,
and network labor, environmental, social justice, and other
organizations, not to mention Asian, African, and Latin American
Studies, along with International Relations, Labor Departments,
Women's Studies, Environmental Studies, students, staff, and faculty,
etc. Fair Trade practices are environmentally sustainable, fair, and
independently monitored - all of which are essential components of a
green campus and a democratic global economy. Campus activists have
been key players in the anti-sweatshop movement. Now we have a chance
to promote purchasing restrictions on our campuses for Fair Trade
Certified coffee. Check out our Action Pack for tools and resources.
What can teachers, professors, and graduate students do?
A: Invite a guest speaker to your classroom to talk about Fair
Trade. Order a copy of the video Santiago's Story and show it to your
students. Have them discuss Fair Trade, what it means and what they
can do to support it. Follow up with concrete actions (delivering
postcards and petitions to a local Starbucks for example, or
organizing a public education presentation on Fair Trade for the
community). Discuss with the students what it means to take concrete
action in promoting fairness in the global economy. Check out our
Action Pack for more ideas.
There is also a serious need for expanded research around Fair Trade
issues, such as the improvement in farmers' lives, working conditions
on coffee plantations, consumer research, and movement strategies. If
you are interested in researching themes of use to the Fair Trade
movement, contact deborah@globalexchange.org.
What role can labor unions play?
A: Labor unions have been at the forefront of the movement for Fair
Trade in the global economy, and have played an important role in the
Fair Trade movement in Europe and Canada. Make sure that your local
workplace serves Fair Trade Certified coffee. Make it a demand of a
union contract that the worksite sells on Fair Trade Certified coffee,
for example at a hotel. Make the connections between farmworker issues
at home and abroad. Check out our Action Pack for more ideas.
What role can religious groups play?
A: Religious organizations have a long history of supporting social
justice and promoting positive solutions to global injustice. Send a
letter to local cafes and grocery stores asking them to sell Fair
Trade coffee. Have an event at your social hour or religious education
classes to show the video, Santiago's Story, discuss Fair Trade, and
write letters to your local stores. Make sure that your local place of
worship serves Fair Trade Certified coffee at coffee hour or other
events. Encourage your church to purchase Fair Trade coffee as a
fundraiser - check out the Fair Trade Certified vendor list. Check out
our Action Kit for more ideas.
Also, see this article from
The Catholic Voice.
What can regular consumers do to support Fair Trade?
A: Consumers can play a powerful role in demanding that coffee
companies offer us the choice to buy Fair Trade Certified coffee. We
can demand that they take responsibility for the working conditions of
the people who produce the product that makes their business
successful.
- Buy Fair Trade Certified coffee.
- Ask for Fair Trade
Certified coffee where you shop.
- Drop a note in the suggestion box at your local grocery store
or café.
- Get involved in the Fair Trade movement -- contact us for
information on how you can help build Fair Trade in your community!
- Check out Ten Things You Can Do for Fair Trade for more suggestions.
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