What is Fair Trade?


What is Fair Trade?

Fair Trade StampWith the recent organic boom and Whole Foods popping up all over, people are starting to see more and more coffee labeled Fair Trade. But what is fair trade coffee and why is it important?

The influx of large corporate coffee producers has dropped the market price for coffee on the global market. For many, this seems like it would be a good thing, I mean lower prices are better, right? Well, sort of. Unfortunately, consumer prices have failed to decline with this production cost decrease. The reality is that the corporate farming increase has forced many small coffee farmers to accept prices less than their productions costs, which leads to higher amounts of debt and more poverty.

So, you ask, how does buying fair trade coffee change this? Well in order to be certified as fair trade, several very stringent criteria must be met. First, the price paid to the producer must be at least $1.26, as opposed to the current market price of $.65, per pound. Also, the importer must provide credit and technical assistance to the farmers. These additional supports not only assist the small family farmers, but also help to promote organic farming, develop the economy, and protect the environments in the third world countries where the majority of coffee is produced.Fair Trade Coffee

The result of the fair trade certification is not only an improved economy in a underprivileged country, but coffee produced in small batches by artisans who are more concerned with maximizing the quality of the beans than their own profits. The next you are in the market for coffee I recommend picking up a pound of fair trade beans and seeing what a difference they can make.

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April 4th, 2006
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Comment Number:
1
Written by:
cybele
Posted on:
April 5, 2006 at 10:56 am

I have a question about Fair Trade. Are there any American coffees that are Fair Trade? I’m talking about Hawaiian coffees like Kona and Kauai … or do our farm and labor laws cover that?

Comment Number:
2
Written by:
ExtraMSG
Posted on:
April 5, 2006 at 11:35 am

It’s a private subsidy — charity. Call it what it is. It has nothing to do with trade. It suffers in all the same ways as subsidies, too.

You suggest that this will allow artisans to focus more on quality. If quality is important to consumers, they would be able to focus on it anyway and send along the extra cost to the buyers.

Subsidies always hurt those they’re meant to help by encouraging them to be less efficient, less competitive, and more wasteful. Also, they have tendency to create inequity in the system, with some people getting a lot more for less work than other people. If widespread enough, they can create dangerous inflation because you have an influx of income for some who have more buying power, while others suffer under their former incomes, trying to get by during rising costs. And if you think the average coffee farmer is the guy who will jump through the hoops and have the information to jump through the hoops to be part of a fair trade program, you’re kidding yourself. You’re probably helping some guy who was already doing pretty well to begin with, just like agricultural subsidies in the US end up helping corporate farms more than the family farms. And even then, do you think those profits are getting passed along to the pickers in the fields?

Also, you encourage people to move to a cash crop like coffee and away from other crops even more than they might otherwise. It’s the same effect that illicit drugs have on local agriculture.

Comment Number:
3
Written by:
Brenda
Posted on:
April 5, 2006 at 1:06 pm

Fair Trade is better than Maxwell House, but there are better options out there too.
I know that Allegro is not fair trade but fairly traded.
They pass the money on to the farmer rather than the middleman.

Comment Number:
4
Written by:
kathy
Posted on:
October 18, 2007 at 10:05 pm

If you want to see it all for yourself (and you’re a teacher), Sam’s Club, TransFair USA and Brazilian coffee company Cafe Bom Dia are sponsoring Fair Trade study grants. 10 winning teachers will spend a week next summer visiting fair trade cooperatives, farms and communities. Pretty cool opportunity to really study this economic model.