Tasting the challenge
Flipping through radio stations while driving down Santa Monica Blvd. today (I had to get an oil change), I heard the last bit of a lil Make Trade Fair clip Chris Martin’s recorded (mp3). Wow! It’s hit the mainstream!
When I got home I had an email about Oxfam’s Fall Action Center waiting. I checked out the site, emailed Oxfam about some broken link issues they have going on, and submitted the upcoming fair trade coffee tasting at USC to the events section.
All Trojans — Be there for your free fair trade coffee:
Where: Trojan Grounds, University Park Campus, at USC
When: 8 am to 4 pm-ish. Friday, Nov. 11.
What: Taste Starbucks’ fair trade offerings, give feedback on the different blends, and learn a lil about fair trade.
The Trojan activists have been rather busy. Gloria of Oxfam-USC’s been writing a letter to the editor for the student paper, and contacting a reporter who’ll hopefully write about the event. Sean of USC Costa Rica’s readying the emails to various student listservs and securing a large stack of used office paper to print flyers on.
Odd working on a somewhat Starbucks-promotional event, while also working on the Starbucks Challenge — though I guess the latter, if Starbucks really decided to meet consumer demands, could be turned into a promotional event too… As Sean says, “I’m very impressed with how well this has been going. It’s kind of awkward to shake hands with the devil, however.”
Ok ok — Once again, I don’t think Starbucks is the devil. It’s a hyperbole. I mean, I’ll have to see what happens with the Starbucks Challenge 2.0 to really opinionate on that.
**Update, 11/11/05: The tasting, covered here.
Filed in: oxfam starbucks starbuckschallenge usc losangeles california fairtrade coffee
Hi Siel,
Glad to hear about the Starbucks Fair Trade coffee tasting at USC. I am confident that Jonathan and John will coordinate a very informative event. Afterwards, if you have any questions, feel free to contact me.
I think USC Costa Rica and The School for Field Studies are doing some great things. It makes me sad to hear that Sean feels a collaborative effort with Starbucks to help coffee farmers is “shaking hands with the devil.” I was just curious if the coffee that Sean and USC Costa Rica purchased is Fair Trade Certified? I know it is organic and that the students paid a premium price but wasn’t sure if it had the Fair Trade certification label as well. I appreciate your thoughts.
Good luck with the tasting! I wish I could be there to meet you…well, maybe next time.
~Cindy
Comment by Anonymous — November 8, 2005 @ 3:33 pm
Wait — Cindy — But I have questions now! :o Wondering if the meetings with the retail operations and communications teams have taken place, and if so, what’s going to be done about the continuing breakdowns in Starbucks’ customer service.
About the devil comment — This came after Starbucks tried to slip in a creamice tasting — a NON fair trade product — at the fair trade coffee event. The creamice has since been expelled from the event, with Starbucks graciously removing the product upon USC Hospitality Services’ request.
Jonathan was also under the impression that a French press of fair trade coffee cost $4.95, and that fair trade certified coffee was still brewed on the 20th of every month. I can forward you the emails about this, including my own email informing him of Starbucks’ current policies.
So as you can imagine, we do kind of question Starbucks’ claim that Starbucks and the fair trade movement have similar goals. “Devil,” however, was prolly going a lil far ;)
In Sean’s defense, his group, USC Costa Rica, did outbid Starbucks — by 36%, no less — and gave farmers who used to sell to Starbucks a better, more lucrative option. Something Starbucks had the resources to do themselves, but did not do.
Sadly, the Costa Rica coffee is not fair trade certified, although the farmers are paid over the $1.26 baseline price per lb. You can be sure I’m bugging Sean about this. I think Sean is a lil more idealistic than I am, and feels more consumers will do their individual research and opt to buy “relationship coffee.” I’m of the opinion most people don’t feel they have the time to research this stuff — and that many don’t even know why something like fair trade — let alone “relationship coffee” — would be important.
In any case, I’ll let Sean know about this discussion — Maybe he’ll weigh in :) I have my fingers crossed for the 2006 crop!
Comment by Siel — November 8, 2005 @ 5:06 pm
Our coffee is not fair trade certified. Why? Because our co-op simply cannot afford it. It costs 2000 dollars to get a co-op fair trade certified. Our co-op has about 10 members, and the cost they would have to pay would mean more than a month’s income each.
Another thing to note is that they grow premium coffee. Starbucks paid them 3-3.50 a kilo for their coffee. We paid 5.25! That’s nearly three times the minimum price fair trade guarantees. Now try to explain to the farmers why they should get certified. I didn’t quite understand this anomaly, but it makes sense when you think about it. Land prices in Atenas are extremely high which means high taxes, the co-op is very small so it loses on economy of scale, and the co-op had just undergone a conversion to organic so their yields were some of the lowest ever since it takes a while to build up production using organic farming. The only problem with this whole project is that you as a buyer have no idea if I’m lying.
And consider this: Starbucks paid 3.50 a kilo, yet it uses the statistic that its average cost per pound is 1.20 (2.50 a kilo w/ a rough conversion). It makes me wonder what the minimum they pay farmers is to get an average like that.
I read David Griswold’s article on relationship coffee: http://www.sustainableharvest.com/press_06.htm and I’m fond of it because it’s true to exactly what we’ve done. It isn’t just a fuzzy ideal either, it makes business sense and everyone wins. I’ve met one of our farmers. I toured his farm, saw his coffee plants. I shook his hand and he told our whole group thank you…because we paid a fair price, and it made his life better. I doubt a Starbucks representative ever shook that man’s hand, and that’s what makes it relationship coffee. David has also taken buyers to visit farmers in the fields of Rwanda and lists the origins of all his coffee. Cindy, where does Starbucks buy all of its coffee from? I would love a list of every supplier Starbucks has so I can go meet each farmer personally and say, “So, how is putting food on the table going for you?â€? just so I can hear their response. I know for a fact that Starbucks once bought our coffee through a middle-man, known as a coyote, so Starbucks didn’t even know where that coffee came from, let alone the fact that the farmers weren’t receiving nearly enough for their product.
Siel does, however, have a good point. How can responsible coffee providers be trusted anymore than Starbucks? Starbucks has a number of programs for giving credit to small farmers as well as a couple conservation programs. A lot of good stuff really. The big difference is that sustainable coffee only represents a small part of Starbucks – I read about 3 percent when I did my business ethics presentation on them. Sustainable meaning organic, fair trade, or shade grown. In comparison, Ric said 70% of Groundworks coffee is organic and will soon be 90%. And don’t get me wrong, buying only organic leaves out a lot of farmers, which is why Groundworks also works with farms in transition. It’s all about building a relationship that supports responsible business decisions on both ends so farmers who make a commitment to switching over to more sustainable cultivation will be supported in the process. The problem with relationship coffee is that there is no watchdog guarantee that a company is not “green washing.� So, it’s an idea in development, but it definitely deserves consideration because fair trade certainly isn’t the end all solution since some farmers are left out.
And while I have the power of the blog in my hands, I’d like to point out that having Starbucks fair trade at USC is a good step, but a baby step. If anyone is wondering why Starbucks is so gracious about setting USC up with fair trade, it’s because it’s policy to offer fair trade to campuses on request. Sadly, the last time I read about this, only 25% of all Starbucks contracted campuses were fair trade campuses. And I believe the motivation behind this program may have something to do with the fact that Starbucks is losing market share to more socially responsible businesses like Pura Vida Coffee (http://www.puravidacoffee.com) on college campuses. As long as there is no need to appease, it won’t happen. Same with the “on request� fair trade French press, only at least there wasn’t the same break down with this program.
As long as you’re not sick of reading good articles, here’s another one for the library: http://www.theeagleonline.com/media/paper666/news/2005/04/04/News/Starbucks.Defends.FreeTrade.Position-911215.shtml It is about a university where the students had a choice between Starbucks and Pura Vida Coffee as the new campus supplier. There are a lot of better choices than Starbucks out there when it comes to social responsibility and it makes me wonder why there aren’t more student campaigns to banish Starbucks from campuses completely. I know I’m leaving a lot of important talking points out here and the last time I saw someone criticize Starbucks’ policies in the campus newspaper, a SB rep replied with an overwhelming amount information. I suspect the same will happen here, so if you’re reading this, please do your own research! Don’t take either side for face value.
I will say this, however. Pura Vida Coffee is non-profit and its mission statement is to improve the lives of coffee farmers. SB is a for-profit business that is designed to make investors money. If you’re going to buy fair trade, buy it at Pura Vida Coffee. If you’re a campus looking for socially responsible supplier, look at Pura Vida Coffee. If you want to guarantee your campus sells coffee that is as beneficial to personkind and the planet as possible, start a petition for your campus to switch to Pura Vida Coffee when the Starbucks contract expires. Even at USC this is easier than you think. All you have to do is get a student senate resolution passed that says the students want USC to end its affiliation with Starbucks as soon as it is contractually possible. It’s as easy as it gets. We can all learn something from American University about taking control of our campuses. Afterall, we pay for them. We should be use our voice to say which businesses we believe in.
One last thing: Bring your travel mug to Starbucks! Apparently they’ll give you 5 cents off your coffee. It should be part of the Starbucks challenge because it’s another case where corporate policy doens’t trickle down to individual stores.
Comment by Sean — November 8, 2005 @ 9:02 pm
One thing I wonder is — Could USC Costa Rica offer the co-op a higher price on the condition that they get fair trade certified? Meaning that USC CR could maybe offer a price higher than whatever Starbucks or any other company/org is offering them, even after the $2000 for the certification fees. The argument for the farmers: It would make the coffee a helluva lot easier to market in the US for USC Costa Rica.
With certification, I’d be more than happy to promote it on green LA girl. I’ll even go so far as to say that — based on my reader demographics — we’d sell at least 300 lbs of FT certified USC Costa Rica coffee via the blog. I’d pledge to buy the remainder if 300 lbs isn’t reached.
I would love for people to research where their coffee comes from, but I do feel that for many working parents — even the ones who do care about these issues — this is simply not an option that corporate America allows, timewise. Which makes the FT sticker vital.
Cindy, if you get a moment — What is Starbucks’ minimum payment to farmers for their coffee? We all know the average is $1.20 an lb, but it’s clear many farmers do not receive even that sum. For Starbucks to make a “all our coffee’s fairly traded” claim, I’m guessing the company must have some numbers to back up the claim?
I’m also wondering if Starbucks would be willing to put up the CAFE stats on their website. As of 2004, less than 15 percent of Starbucks’ coffee was bought that met CAFE standards — yet this information isn’t avaliable on the website — which I believe can be very misleading for customers.
And regardless, I’d love to hear from Starbucks about the meetings taking place about the “break down in customer service” — a breakdown that has yet to be fixed.
Hope to hear from you soon.
Comment by Siel — November 10, 2005 @ 9:25 pm
Hi Sean,
Thank you for responding in detail about USC Costa Rica. I apologize for my late response, but I was out of town.
First of all, I think your program is amazing. It is so important for people, especially the American consumer, to learn about where their coffee comes from. And you and your fellow students had the privilege of meeting some of these farmers and shaking their hands. I am sure it was a life changing experience as it is for me when I visit coffee farms and farmers.
You are correct that it would not make sense for your coop to become a Fair Trade Certified coop for the reasons you stated. It is very expensive to join the Fair Trade registry, and they would have to pay an annual fee to remain on the registry whether or not they sold their coffee at Fair Trade prices. And if they did sell their coffee at Fair Trade prices, they would have to pay an additional fee per amount sold.
I think it is excellent that your group outbid Starbucks! It is this type of “competition” between coffee buyers that will allow the farmers to earn the most they can for their premium coffee. Maybe next time, Starbucks will bid more for the coffee. The coop is actually lucky they were not FT certified, because if they were, they would not have received the 5.25/kilo you all were willing to pay. Most likely, Starbucks or another comapny would have paid them the $1.26 per pound.
You talk about the “relationship coffee” model being a sustainable model. ABSOLUTELY!! The article you referenced by Karen Foley highlights the importance of personal relationships and transparency through out the coffee supply chain. Because just as the article mentioned, the role of the intermediaries such as the mills and exporters are very important, but transparency is key. I am excited to hear about any coffee company that practices transparency, and I hope more join the movement.
You mention that Starbucks bought coffee from a “coyote”. I can’t deny that may have happened in the past. As you know, coyotes are a big problem in the coffee industry, and unfortunately in some cases, are the only ones who can reach the more remote farmers. And because some farmers do rely on coyotes for their livelihoods, the question is how do we (the coffee industry) force ethical business practices by the coyotes? Or how do we better reach the remote farms without them?
You know from your experience that transparency is extremely difficult in the coffee industry. And this is why one of the prerequisites for C.A.F.E. Practices is transparency. Anyone we buy coffee from (exporters, mills, trading houses, coops) has to keep records and show us how the money we paid is distributed through the supply chain. So if we are buying from coyotes, they too will have to provide documentation to us. They will be forced to keep records, and they will be audited by an independent third party. Thank you for informing me that we may have purchased coffee from a coyote. We will contact that particular coop; find out what happened and take steps to correct the problem if it hasn’t been addressed.
Siel mentioned that last year Starbucks only purchased 14% of its coffee under C.A.F.E. Practices. In a conversation with Siel, I told her that the 14% was not purchased under the current C.A.F.E. Practices, but under the pilot program, Preferred Supplier Program (PSP). Starbucks reworked PSP from the lessons learned and feedback from farmers, activists, etc. The new guidelines were renamed C.A.F.E. Practices.
So will all of Starbucks coffee be purchased under C.A.F.E. Practices? We hope so. That is our goal, but it is a slow and long process. We are asking some farmers to completely re-evaluate they way the grow coffee for better quality and environmental standards. In all fairness to the farmers, we can not ask them to do it over night. These farms have been in their families for generations. The folks from our Farmer Support Center are working to get them up to speed on the guidelines. We can not cut off the farmers who may need more time. We need to give them enough time and support to make the necessary changes.
Our coffee buyers travel all over the world visiting coffee farmers. We even opened a Farmer Support Center in Costa Rica which employs local agronomists and sustainability experts. Their sole purpose is to work with coffee farmers one on one to develop best practices for high quality coffee and environmental conservation. We even work with farmers who do not sell their coffee to Starbucks. I would be more than happy to give you the names of our suppliers, and you are more than welcome to visit them the next time you are in Costa Rica.
I know there are questions around the $1.20 Starbucks paid per pound last year. Prices vary by regions and according to quality. For example, we paid $1.25 for our Shade Grown Mexico. And Fair Trade pays $1.26 in Latin America and $1.05 in Africa. And it is important to note that the $1.26 goes to the cooperatives not the individual farmers. Some FT coops such as Cooperativa Café Timor in East Timor has over 17,000 farmers. According to TransFair USA, last year the Fair Trade farmers we bought from received between $.47-.97 per pound. We are asking TransFair USA for the same transparency and documentation we are asking from our other suppliers. Because, unfortunately, not all coop leaders are honest or fair. Please don’t get me wrong. This is still far better than the typical price on the C-market. And the Fair Trade movement has done an incredible job of bringing the plight of the coffee farmer to the consumer. Fair Trade certified coffee is an absolute must for the coffee providers whether small coffee shops or big corporations who do not have visibility into the coffee supply chain. Fair Trade is essential for the companies who are purchasing their coffee from the C-market.
Of course, the most intriguing question is how can responsible coffee providers be trusted without the certification? And does coffee without a certification such as organic, fair trade, or shade grown mean that it was not grown and purchased in a sustainable fashion? My question is (completely independent from Starbucks) from my own research. Are all these certifications best for the farmers or is it to alleviate our consumer guilt because we are all too busy to learn about the products we purchase? Bottom line - are the certifications serving the coffee farmers or serving us?
Sean - I completely agree when you said, “Please do your own research! Don’t take either side for face value.” There are many coffee companies or buyers doing great things for the farmers either with or without the certifications. I believe consumers should put their money where their heart is. I would never tell someone to purchase Starbucks coffee over anyone else’s. I just ask that they make informed decisions and follow their heart.
I know Starbucks will always be a target. Someone will always have a problem with the way we do business. I guess that is the price Starbucks pays for addressing the issues; engaging with our critices and trying to be a leader in the industry. As the saying goes, “It is usually the second mouse that gets the cheese.” Starbucks is not perfect. We have a lot of work ahead. Also, we sometimes have the best intentions that are not the reality in our stores. But we will keep on trying.
Sean - your passion, commitment and knowledge of coffee would serve the industry well. I hope you decide to pursue a career in this field. You would be an important and vital asset to ANY coffee company, because we always need people who look out for the farmers. I would love to continue our conversation. Feel free to contact me - choots@starbucks.com. I would love to hear more about your experiences in Costa Rica. It is truly an amazing country with incredible people.
Thanks for the links you provided. I am also providing an interesting link to a graduate thesis written by Ruth Fend from Tufts University. It gives a very balanced view of Fair Trade. Hope you find it interesting.
fletcher.tufts.edu/research/2005/Fend.pdf
I apologize for my long comment. I guess it shows the complexity of the issues.
Best of luck,
~Cindy
Comment by Anonymous — November 15, 2005 @ 1:38 pm
If Cindy is talking about the CCT co-op in East Timor, they have 19,600 members. Furthermore, farmers ARE the COOP. I don’t understand the point of saying that the $1.26 goes to the co-op instead of the farmers unless you want to falsely imply that something is wrong with the Fair Trade Certified co-op system and farmers are getting a raw deal because of it.
Like any business, a co-op has operational costs and other expenses. The benefit of a co-op is that the farmers have a say on what these costs are and how to deal with them. Moreover, the farmers have a voice not only in how profits are re-invested, but also in how the money given back to themselves.
I do know of one case of a corrupt leader of a FTC co-op. When missing funds were discovered by FLO at a yearly inspection, the co-op was de-certified and taken off the register. The co-op leader was also fired by the members. There is acountability in the Fair Trade Certified system.
To finish, the Fair Trade Certified model certifies PRODUCT, not companies. A corporation may offer FTC product, but the fact that they do is in no way a validation or certification of their own corporate practices. That is up for the consumer to decide. So, it is up to a company to convince their customers that their own practices are sustainable. For some consumers, a company declaration is enough, for others, an independent third party certification is better.
Comment by Anonymous — November 15, 2005 @ 3:38 pm
My apologies, Anon. I was not implying that there is something wrong with the FT coops. I was just clarifying a misconception I hear over and over again that $1.26 goes to the individual farmers.
I know FT does great things. I have seen it myself. FT empowers farmers and that is always a good thing. I just don’t think there is a “one size fits all” solution to something as complex as the coffee industry. Many models need to work together to better serve the farmers.
And I do agree that consumers should look into a company’s business practices even if they do offer all Fair Trade. Thank you for that clarification.
CCT is one of our favorite coops. Starbucks has been buying coffee from them for more than 10 years. And we underwrite their mobile health clinics. The last time we visited the coop a couple of months ago, we were told the membership was 17,600. If you would please give me your source for the 19,600 number, I would like to correct our records.
Keep an eye on this website as we will be including a great story from CCT.
http://www.closeupproductions.com/coffeestories/
Thank you responding to my comment. I was happy to hear that a corrupt FT coop leader was fired.
~Cindy
Comment by Anonymous — November 16, 2005 @ 3:31 pm
Hey Cindy — Thanks for trying to clarify your comments. I’m still wondering, though, why you feel it’s important to point out that $1.26 goes to the co-op, not the individual farmers — especially now that you say you weren’t implying there’s something wrong with the FT co-ops. Considering the FT co-ops are owned by the farmers, I’m still not sure why you feel this is a “misconception” — one that you seem to consider a troubling one. Wondering if there’s a detail I’m missing?
Comment by Siel — November 18, 2005 @ 8:58 am