Posted by Chris Treter
In “Fair to the Last Drop – The Corporate Challenges to Fair Trade Coffee,” The Institute for Food and Development Policy (AKA Food First) provides us with an excellent indepth study examining the very important debate within the fair trade movement.
Here’s the jist:
Coffee growers are the losers in the global coffee industry, receiving less than 10% of the 80 billion dollar a year business. Following its humble beginnings just 20 years ago within the coffee sector, Fair Trade has quickly developed in part due to a process of mainstreaming.
In the United States, more than 400 coffee roasters are selling certified fair trade coffee. However, only about 20 purchase 100% of their coffee under Fair Trade criteria. Some of the “corporate colonizers” who have joined on, such as Procter and Gamble, Kraft, and Seattle’s Best (owned by Starbucks), only purchase 2 % of their coffee as fair trade although just 5 companies control nearly 70% of the total global coffee market. Between those twenty 100% fair trade coffee roasters and the 380 other roasters who offer a portion of coffee at fair trade prices, lies a growing divide.
The mainstreamers – such as Starbuck’s, Procter and Gamble, Kraft, and a host of smaller specialty roasters believe (or at least their purchasing policies and marketing actions lead one to assume) that within the neoliberal economic system lies the ability to adequately transform the lives of coffee growers. Whereas many of the fair trade “movement companies” argue that the neoliberal economic system is at fault for the conditions (extreme poverty, lack of education , access to water, and health care) present in coffee growing communities and therefore a complete shift needs to take place away from the current neoliberal system.
Eric Holt- Gimenez, Ian Bailey, and Devon Sampson do a great job of summing it up when they write:
“The neoliberal position that markets in and of themselves are sufficient to reduce poverty, end hunger, and promote sustainable development, is a notion that has been refuted by two decades of disastrous corporate-led globalization…….. When coffee prices dropped catastrophically in 2001 and 2002, it became clear that Fairtrade price floors provide an essential safety net for farmers.”
However, this “safety net” has served well in the most disastrous of times but does not adequately help farmers lift themselves out of the poverty they find in their everyday lives.
Opposing this notion of fair trade as a “safety net,” many fair trade “movement companies” are taking on something our farming friends south of the border call “solidarity economy.” That is, a more holistic approach to fair trade that incorporates community development, partnership, shared risk, activism and education by walking hand in hand with the growers and their local political and economic struggle. Price is but a piece of the tasty pie that is a deeper version of conventional fair trade.
In the report, the author’s ask a series of important questions:
“Is the goal to help as many peasant farmers as possible by selling as much Fairtrade coffee as possible? Or is the goal to transform coffee’s historically unfair market structures? Are markets the engine for social change or are social movements the force to change markets?”
For the mainstreamers, “Fairtrade is not a social movement or a business ethic, but rather a public relations opportunity and a profitable niche. They take advantage of the “halo effect”—the tendency for the good feelings around one product to reflect well on the entire brand (Nestle, 2002).”
But the holistic approach of fair trade “movement companies” seems to be making a positive impact –
“At the very least, there appears to be a mutually beneficial relation between higher premiums and the extensive social and political work carried out by farmers’ movements. Under these circumstances, it is difficult to imagine Fair Trade even taking root without building upon the historical agrarian struggles for land reform, cooperative organizations, and peasant and indigenous rights………… none of this is reflected in corporate marketing of Fairtrade, where development claims are politically sanitized for mass consumption.”
In the end, the authors argue that, “The future of Fairtrade hinges on the degree to which it can bring producers, consumers and roaster-distributors not just into its market, but into the growing social movements for agrarian change.”
I couldn’t agree more. Fair trade is not just a price paid to an importer, certification acquired from a third party, and a label adhered to one’s package of coffee. But rather fair trade should be the quest to seek out long term relationships with partner growers that reflect transparency, long-term commitment and support for the development of coffee growing communities and its coffee producing infrastructure. Some organizations are already walking down this path.
In addition to Higher Grounds Trading Co., check out these other pioneering fair trade “movement companies” working in the vein reflected in this article. Cafe Rebelion, Dean’s Beans, Thanksgiving Coffee, Cafe Campesino, Just Coffee, and a host of other companies in Cooperative Coffees are striving to pay higher than the fair trade minimum while working with growers in the field in a host of innovative ways.