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A jolt with a difference
Cafés, co-ops, small roasters, and religious groups are fueling the popularity of Fair Trade coffee, which pays small growers a living wage

CAN A CUP of coffee change the world? For embattled small-scale farmers like 28-year-old Carlos Reynoso, whose colleagues cultivate coffee beans in the western highlands of Guatemala, the daily choices of US consumers have a big impact. When most people in the US buy a $3 latte, a cup of java on the go, or a bag of beans at the supermarket, they unsuspectingly support a status quo in which poor growers in Latin America, Asia, and Africa receive as little as 20 or 25 cents for a pound of high-grade coffee. But when consumers buy Fair Trade coffee — which guarantees farmers a minimum price of $1.26 per pound — their spending fosters a variety of positive effects, not the least of which is the ability of these growers to sustain their livelihoods.

As one of six employees of Manos Campesinas, a collective that coordinates coffee exports for more than a thousand small growers, Reynoso has personally seen the impact. Since global coffee prices began plummeting a few years ago, many farmers have been unable to earn enough to support themselves, causing them to abandon the land and search elsewhere for work. Since Manos Campesinas became Fair Trade–certified in 1999, however, the heightened revenue stream has raised the income of farmers, he says, enabling their families to enjoy a better diet and their children to remain in school.

Speaking through a translator during a telephone interview arranged by the nonprofit development agency Oxfam America, Reynoso notes that Fair Trade isn’t a panacea for poverty. It does, however, offer some substantial big-picture benefits in a country like Guatemala, which suffered from decades of violence and anti-union activity in the wake of a US-backed coup, in 1954. "Now people are realizing there are benefits to organization, and that if they can work together, they can achieve greater things," Reynoso says. There’s still not sufficient demand to sell all the collective’s coffee through Fair Trade channels, he adds, "[but] the more that consumers get to know what Fair Trade means, the more possibilities we will have."

Although Fair Trade–certified coffee has been available in the US since only 1986, it is rapidly growing in popularity. TransFair USA, an Oakland, California–based nonprofit that monitors the product, announced this spring that it certified 18.7 million pounds in 2003 — a 91 percent jump from 2002. Equal Exchange, a Canton-based cooperative (soon moving to West Bridgewater) that bills itself as the nation’s leading Fair Trade company, has enjoyed enviable growth, topping $10 million in sales and gaining recognition as one of the fastest-growing small firms in the region. Furthermore, although Fair Trade coffee represents only about one percent of the 2.8 billion pounds of coffee imported into the US in 2003 — aiding just a small fraction of the world’s 25 million coffee farmers — industry giants like Procter & Gamble, Starbucks, and Dunkin’ Donuts have slowly begun to include Fair Trade offerings among their offerings.

It’s not hard to see why proponents tend to embrace Fair Trade java with something approaching evangelical zeal. Perhaps like no other product, a cup of this coffee holds the promise of empowering consumers as a force for global good, offering at least a potential counterbalance to unmitigated corporate consolidation and the exploitation of workers in undeveloped nations. With the spread of the Fair Trade approach to other products in recent years, including chocolate, cocoa, tea, bananas, mangoes, pineapples, and grapes, the prospects seem even greater.

For conscientious coffee mavens like Rik Kleinfeldt, the owner of New Harvest Coffee Roasters, in Rumford, Rhode Island, emphasizing Fair Trade beans comes down to doing the right thing. As New Harvest states on its Web site, www.newharvestcoffee.com, "Over the last 200 years, less and less money has gone to the people who actually make things, and more and more wealth has flowed into the coffers of people with soft hands and no shame. The coffee industry is no exception. The people who do the hardest work in making your morning cup possible, the farmers, have long received the smallest share of the proceeds. We want to do all that we can to reverse this reality."

Then again, it’s the willingness of people like Kleinfeldt to yield just a bit on the bottom line that explains why religious groups, liberal-leaning universities like Brown, and independently owned cafés and small roasters — rather than the giants of the industry — have fueled the rise of Fair Trade coffee. For a café serving it, the added cost of providing growers better wages comes down to a few pennies, and consumers can find Fair Trade coffee at local supermarkets like Shaw’s and Stop & Shop at prices competitive with the conventional stuff. Yet the major industry players, although they generally attribute their reluctance to make a more robust commitment to a lack of consumer demand, seem unwilling to absorb the slightly higher cost of buying Fair Trade coffee.

Given all this, the question becomes whether Fair Trade coffee is destined to remain just a bit player in the multi-billion-dollar coffee market — or whether it’s poised to become a greater force for change.

THE PUBLIC IMAGE of the coffee industry is long on caricatures such as Juan Valdez and colorful tales about the elixir’s storied past. A history on the Web site of the National Coffee Association of USA (www.ncausa.org), for example, describes how coffee, after first being cultivated in the highlands of Ethiopia, became one of the world’s most valuable export crops by the end of the 18th century. Along the way, European opponents condemned the buzz-worthy beverage as the "bitter invention of Satan," although Pope Clement VIII, after being asked to intervene and tasting coffee, saved the day with a papal blessing. And when it comes to the rise of America’s unswerving java jones, the NCA attributes the cause to a moment no less important than the Boston Tea Party.

Considering such upbeat anecdotes, it’s a safe bet that relatively few Americans are aware of serious problems gripping the global coffee industry in recent years, particularly the extent to which supply has outstripped demand. Summing up the situation in a September 2002 report titled "Mugged: Poverty in Your Coffee Cup," Oxfam warned, "Farmers sell at a heavy loss while branded coffee sells at a hefty profit. The coffee crisis has become a development disaster whose impacts will be felt for a long time." Although the report prescribed a systemic solution to narrow the gap between supply and demand, it also called for paying growers more than their production costs. Ultimately, Oxfam noted, "This is about more than coffee. It is a key element in the global challenge to make trade fair." Indeed, although prices have edged up a bit, the benchmark export price last week for a pound of coffee at the New York Board of Trade was just 66 cents, of which growers receive only a fraction.

The Fair Trade movement came about in response to similar problems with plummeting coffee prices in the late 1980s. TransFair USA traces the roots of this effort to attempts by North American and European churches in the late 1940s to provide relief to refugees and other poor communities by selling their handicrafts in Northern markets. In 1986, the worker-owned co-op Equal Exchange was formed "to create a new approach to trade, one that includes informed consumers, honest and fair trade relationships and cooperative principles." It didn’t hurt, of course, that the movement came about as coffee-consuming Americans were becoming more receptive to better beans and organically grown food.

Beyond giving growers a fair price for their products, moreover, Fair Trade produces important secondary social benefits: since most Fair Trade–certified coffee in the US is shade-grown and certified organic, it supports biodiversity, provides shelter for migratory birds, and helps to reduce global warming. Because growers receive a fair price, they are able to avoid shortcuts that sacrifice quality. Besides these positive outcomes, TransFair USA cites communal success stories, including how a coffee co-op in Colombia prevented the cultivation of 1600 acres for illicit drugs, and how another, in Papua New Guinea, invested in a medical team to meet the health-care needs of its isolated rural setting.

Seth Petchers, coffee-program coordinator for Oxfam America, says Fair Trade coffee offers a potent way for companies to show that social responsibility is on their agenda. The product is also of the highest quality, he says, as demonstrated by the fact that Fair Trade farmers in Nicaragua claimed seven of the top 10 spots in a competition sponsored by the development organization TechnoServe. "Given fair resources and the ability to invest in quality products, these farmers are really able to deliver some of the best coffee in the world," Petchers says.

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Issue Date: August 20 - 26, 2004
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