November 12, 2020
Recently we got an email from a customer who asked whether any of our coffee is Fairtrade. This is a question we appreciate because it shows that our customers care about the same things we do: fair prices for producers and ecologically sustainable farming practices. But the answer is no, we don't sell any Fairtrade certified coffees. And here's my email response to help explain why:
I don't track whether our coffees are certified Fairtrade because the standards used by Fairtrade International are very basic in terms of what we look for from our green coffee suppliers. My understanding is that Fairtrade is a great program for some commodities (like sugar) because it ensures that producers get paid a fixed amount above the C-market price. But the prices we pay for our specialty coffee are multiples higher than the Fairtrade price would be. For example, yesterday [9 September 2020] the C-Market price for coffee was $1.32 per lb. That's $0.59 (45p) per kg. We typically pay more than 10-16 times that price. Not all of that money will go to the producer, because there's processing, exporting, importing costs etc... but that gives you an idea of why Fairtrade is really not a certification that we consider.
In addition, we work closely with our importers to understand where our coffee comes from and to know that our purchasing power has a positive impact on the people producing the coffee we buy. We receive detailed information about each lot we buy and we pass a lot of that on to our customers via our website and info on social media. If you'd like to learn more about our importers and some of what they do at origin, you can find them here:
I signed off the email, hit send and felt ok about how I'd answered the question. But now that I'm sharing this information as a blog post, I feel the need to expand a little.
The question of how to ensure that producers are receiving a fair price for their coffees is one that stakeholders in the speciality industry have been wrestling with for years. The issue has been especially acute since 2018, when the market price of commodity coffee dropped below $1/lb for the first time ever. This arguably arbitrary threshold was nonetheless a wakeup call to the industry that farmers around the world were in crisis, and that's what the issue came to be known as: the Coffee Price Crisis.
And remember, all of this is going on at the same time as the changing climate is making it harder for farmers to grow coffee. The weather is less predictable, meaning crop cycles are less predictable. Arabica coffee is a crop that requires a specific pattern of hot days and cool nights to thrive. In some places, coffee cherries are ready to pick at different times of year than they have been in the past. For instance, there used to be a main harvest and a secondary (or mitaca) harvest in Colombia. Now, farmers can't be certain which of those harvests will be the bigger one. And more extreme weather events can spell ruin for producers when infrastructure is wiped out, like it was by flooding and mudslides in northern Rwanda this spring. And changing weather patterns give rise to pests and disease like the coffee leaf rust epidemic in Central America in the 2010's, which wiped out an estimated 70% of the harvest in 2012-2013. And finally, as we saw with the frost in Brazil in July 2019, even just talk of bad weather can impact coffee prices and create instability in the market.
In addition, the balance of power in the relationship between coffee producers and coffee consumers is wildly uneven (I think this is especially true for producers selling on the specialty market, which is small and fickle and costly for farmers to access). Coffee producers take on far more risk than anyone else in the value chain. If their crop fails or doesn’t earn them the price they expect the consequences could be very bad for them. If the same crop fails, then the importer that would have brought that coffee to the UK will find another lot, and the roaster that would have roasted it will roast a different coffee. As a consumer, you probably wouldn’t even notice.
Today I asked an agronomist that works for one of our importers what consumers should ask before they purchase a bag of coffee. “Is this coffee Fairtrade?” was maybe the right question at one time. But it’s not enough anymore. Maybe the question should be, “Who grew this coffee?” And, “Are you going to buy their coffee again next year?” If consumers look for coffee from the same farmers year-on-year, then importers will continue buying that coffee, and some of the risk of growing it will be shifted away from producers.
Of course, this is a flaw of the specialty industry: if value is linked to quality, what happens if the quality declines? It might decline for reasons totally out of the farmer’s control. Will consumers still pay the same price? Will it be a “fair” price? Who’s to say? What if it’s not enough for the farmers to thrive on?
I’ve got more questions than answers. And the questions are frightening. But I’m in the lucky position that I get to choose to ask the questions, and if the answers are disappointing, it’s not my livelihood that is threatened, just my estimation of myself.
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