the what, why, how of fairtrade coffee

Fair Trade Coffee The What, Why & How of Fairtrade Coffee

By Coexist www.CoexistCampaign.org

www.Coexist.org

Shameless Plug #1

Yes, we are the “Bumper Sticker People”

The Coexist Campaign sources products from Post-Conflict Areas

Our Coexist Coffee is a delicious, Fairtrade product from Uganda

Mbale, Uganda

Shameless Plug #1 Two Ways you can buy Coexist Coffee:

Online: www.CoexistCampaign.org + $40 Orders get Free Shipping! Ten Thousand Villages Alexandria

915 King Street, Alexandria, VA 22314

Fenton Street Market (Sat, 10-4) Veteran’s Plaza, Silver Spring, MD

Broad Branch Market 5608 Broad Branch Rd, Chevy Chase

District Tea Lodge 1922 I St. NW, Washington DC

Retail Locations

Let’s Get Started…

What is Fairtrade?

A Fair Price Paid to Producers

A Focus on Direct Trade

Cooperative Structure Support

No Child Labor

What is Fairtrade?

Fairtrade Premium: •  At least 5cts of the Fairtrade premium must be invested in the improvement of

productivity and / or quality of Fairtrade coffee.

•  Investment can be made at the level of individual members and/or the producer organization.

•  The General Assembly decides on the activities to be carried out.

•  The producer organization needs to keep records on the use of the monies and to explain in which way it contributes to the improvement of productivity and/or quality.

Coffee from Fairtrade Producers

What is the Fairtrade Premium?

What is the Fairtrade Premium? Washed Arabica

Floor Price: $1.40 Premium: $0.20

$1.00 $1.20 $1.40 $1.60 $1.80 $2.00 $2.20 $2.40 $2.60

Fair Trade vs. Trading Prices

Trading Price Fairtrade Price

What did we Pay?

150 bags Non-Organic washed Arabica at $1.80/lb or NYC + 0.45 which ever is higher. Price includes .20 cents social premium and .25 cents quality premium

150 bags Organic washed Arabica at $2.20/lb or NYC + 0.75 which ever is higher. Price includes .20 cents social premium, .30 cents organic premium, .25 cents quality premium

WHY Fairtrade?

The Fairtrade Goal

Stable Prices

The Fairtrade Premium (reinvestment)

Partnership

Empowerment of Farmers & Workers

Is it Working?*

Yes

•  Pro-Competitive effects (raises prices in a region)

•  Reinvestment does improve quality and yields

•  Increases Social Capital

No

•  Little evidence Fair Trade conditions or monitor have impact

•  Still not competitive with private producers (plantations)

•  Fairtrade cannot overcome other problems like infrastructure and access to finance

*Milford 2004

Common Criticisms

Floor Price can attract poor quality products

Certifications impose overheads that can be crippling

The Free-Rider Problem

Coops need to form Organically, Cannot be Forced

The Catch 22

In Coffee, well-functioning coops are more important than a Fairtrade certification…

Good Coops are more important than Fairtrade Certs

But, it’s difficult for consumers to make informed decisions without Fairtrade certifications on products!

How does it work?

What do these mean?

Fairtrade International Mark Fairtrade USA Mark – a separate org

FLO-CERT is the certifying body of Fair Trade International

Consumer Facing

Producer Facing

The Coffee Value Chain

Farmer

Private Intermediary

Processing Plant

Local Exporter Coffee Buyer

Retailer

Roasting Company

Consumer Origin Country Consumer Country

The Biggest Impact

Farmer

Private Intermediary

Processing Plant

Local Exporter Coffee Buyer

Retailer

Roasting Company

Consumer Origin Country Consumer Country

Buying Direct!

The Gumutindo Example

Gumutindo is a cooperative of cooperatives in Mbale, Uganda

Gumutindo has 17 affiliate Cooperatives

Pros: •  Helped new cooperatives by holding the certs

(Organic & Fairtrade) & training managers

Cons: •  Take a significant premium & create cash flow problems •  Try to prevent their affiliate cooperatives from going independent •  Fairtrade….but not Direct Trade

Peace Kawomera Example

On the Market:

How Much Does the Farmer Make?

3.0K UG / lbs. ($1.17)

To Gumutindo: 3.8K UG / lbs. ($1.49)

Direct to Coexist: 4.5K UG / lbs. ($1.76) (2013 Organic Prices)

Shameless Plug #2

Shameless Plug #2 Coexist Coffee is:

•  Fairtrade & We Buy DIRECT! •  All Grown Organically! •  Profits Go Back to Fund Education!

Shameless Plug #2

1. Go to www.CoexistCampaign.org

2. Buy Our Coffee

3. Make the World a Better Place

Questions?

www.coexist.org

www.coexistcampaign.org