Comments on: Minimum price for fair trade certified coffee goes up http://greenlagirl.com/minimum-price-for-fair-trade-certified-coffee-goes-up/ Urban environmental lifestyle blog in Los Angeles Mon, 22 Mar 2010 06:16:09 +0000 http://wordpress.org/?v=2.9.2 hourly 1 By: mateotemprano http://greenlagirl.com/minimum-price-for-fair-trade-certified-coffee-goes-up/comment-page-1/#comment-200611 mateotemprano Sat, 12 Jan 2008 22:22:22 +0000 http://greenlagirl.com/2008/01/08/minimum-price-for-fair-trade-certified-coffee-goes-up/#comment-200611 Hello, Thanks Siel for the article and the props. A few quick comments: 1) We are currently talking with several of our producer partners to get a better handle on what individual farmers are getting from their co-ops when we buy coffee from them. We'll get that info to ya'll as soon as we get it. Keep in mind that where a traditional intermediary is just another hand in the supply chain outside of the grower communities, co-ops are owned and controlled by the producers themselves. Money staying with the co-ops is invested in their communities in several ways. 2) even better than JC single-handedly trying to push standards including price forward, the $1.61 a pound to paid this year is a Co-op Coffees policy that was set in Xela, Guatemala during a meeting with growers in 2005. This means that there are over 20 other roasters in the US and Canada that have also committed to raising the bar in this way. 3) J-Rod, thanks for all of the insightful comments. One thing I want to point out though is that coffee growers will never be pulled out of poverty by fair trade if their only activity to obtain cash is growing and selling coffee. I know that goes against what some of the FT marketing says, but it is true. The relationships that we are trying to build and (hopefully) money in social premiums from FT contracts can help farmers diversify out of dependence on coffee and get into some other cash generating strategies that they have better control of. Great discussion, as usual! -Matt Just Coffee Co-op Hello,

Thanks Siel for the article and the props.

A few quick comments:

1) We are currently talking with several of our producer partners to get a better handle on what individual farmers are getting from their co-ops when we buy coffee from them. We’ll get that info to ya’ll as soon as we get it. Keep in mind that where a traditional intermediary is just another hand in the supply chain outside of the grower communities, co-ops are owned and controlled by the producers themselves. Money staying with the co-ops is invested in their communities in several ways.

2) even better than JC single-handedly trying to push standards including price forward, the $1.61 a pound to paid this year is a Co-op Coffees policy that was set in Xela, Guatemala during a meeting with growers in 2005. This means that there are over 20 other roasters in the US and Canada that have also committed to raising the bar in this way.

3) J-Rod, thanks for all of the insightful comments. One thing I want to point out though is that coffee growers will never be pulled out of poverty by fair trade if their only activity to obtain cash is growing and selling coffee. I know that goes against what some of the FT marketing says, but it is true. The relationships that we are trying to build and (hopefully) money in social premiums from FT contracts can help farmers diversify out of dependence on coffee and get into some other cash generating strategies that they have better control of.

Great discussion, as usual!

-Matt
Just Coffee Co-op

]]> By: j-rod http://greenlagirl.com/minimum-price-for-fair-trade-certified-coffee-goes-up/comment-page-1/#comment-199104 j-rod Thu, 10 Jan 2008 15:21:21 +0000 http://greenlagirl.com/2008/01/08/minimum-price-for-fair-trade-certified-coffee-goes-up/#comment-199104 This is from the Just Coffee website where they map out the supply chain. It is pretty interesting. Because the coop is one that is receiving the 156 for organic and 135 for conventional. http://justcoffee.coop/map/supplychain This is from the Just Coffee website where they map out the supply chain. It is pretty interesting. Because the coop is one that is receiving the 156 for organic and 135 for conventional.

http://justcoffee.coop/map/supplychain

]]> By: David K http://greenlagirl.com/minimum-price-for-fair-trade-certified-coffee-goes-up/comment-page-1/#comment-198691 David K Thu, 10 Jan 2008 02:31:21 +0000 http://greenlagirl.com/2008/01/08/minimum-price-for-fair-trade-certified-coffee-goes-up/#comment-198691 Thanks for the info. I've always wondered what the actual price farmers received for coffee, fair and free trade. For fair trade the money gets filtered through the co-op, and for free trade through the middlemen. What do they actually get in the end? I've heard some farmers only sell a portion of their crops to fair trade roasters as there's not enough demand, and the rest on the open market. I'd be curious to know what an invidiual farmer makes from each source. That way you can compare the same coffee, same country, same farmer and see just how much more fair trade offers in the end. J-Rod, thanks for the reminder about the weak dollar. You're right, the dollar's lost more strength than the fair traders have increased their dollar prices. Thanks for the info. I’ve always wondered what the actual price farmers received for coffee, fair and free trade. For fair trade the money gets filtered through the co-op, and for free trade through the middlemen. What do they actually get in the end? I’ve heard some farmers only sell a portion of their crops to fair trade roasters as there’s not enough demand, and the rest on the open market. I’d be curious to know what an invidiual farmer makes from each source. That way you can compare the same coffee, same country, same farmer and see just how much more fair trade offers in the end.

J-Rod, thanks for the reminder about the weak dollar. You’re right, the dollar’s lost more strength than the fair traders have increased their dollar prices.

]]> By: j-rod http://greenlagirl.com/minimum-price-for-fair-trade-certified-coffee-goes-up/comment-page-1/#comment-198625 j-rod Wed, 09 Jan 2008 23:23:51 +0000 http://greenlagirl.com/2008/01/08/minimum-price-for-fair-trade-certified-coffee-goes-up/#comment-198625 The problem with talking about minimum pricing standards is that fair trade pricing is hardly helping the farmers make a fair wage. Studies suggest that a family farming full time in mexico, producing fair trade coffee has a net loss of 2,000 usd per year. So unless the minimum pricing structure addresses the fact that fair trade is failing farmers we might as well stop calling it fair (i know transfair has lots of anecdotal evidence of fair trade working but every study done on fair trade shows that it fails, just not as much as conventional). One study suggest that just to get a family to food security fair trade pricing would have to increase by 1 dollar per pound. To make this problem the USD is falling against almost every foreign currency and this is causing further problems for the farmers, the increase in FLO's pricing is basically making up for a week USD, which is really great for European Fair Trade Roasters who saw their price per pound shrink by 20 percent in the last few years. What Just Coffee is trying to do is create a new relationship based model that really helps farmers and pulls them out of poverty, FLO and Transfair on the other hand are really good at growing the label and making us feel better about the coffee we drink. I'm skeptical about Just Coffee's ability to influence change in the current Fair Trade system and some folks have suggested that they get out of Fair Trade completely and work on a new model, but for now it seems that they are at the forefront of pushing Fair Trade to actually mean something. I pulled most of my data from Dan Jaffee's book called 'brewing justice' which was published by UC Press. J-ROD The problem with talking about minimum pricing standards is that fair trade pricing is hardly helping the farmers make a fair wage. Studies suggest that a family farming full time in mexico, producing fair trade coffee has a net loss of 2,000 usd per year. So unless the minimum pricing structure addresses the fact that fair trade is failing farmers we might as well stop calling it fair (i know transfair has lots of anecdotal evidence of fair trade working but every study done on fair trade shows that it fails, just not as much as conventional). One study suggest that just to get a family to food security fair trade pricing would have to increase by 1 dollar per pound. To make this problem the USD is falling against almost every foreign currency and this is causing further problems for the farmers, the increase in FLO’s pricing is basically making up for a week USD, which is really great for European Fair Trade Roasters who saw their price per pound shrink by 20 percent in the last few years. What Just Coffee is trying to do is create a new relationship based model that really helps farmers and pulls them out of poverty, FLO and Transfair on the other hand are really good at growing the label and making us feel better about the coffee we drink. I’m skeptical about Just Coffee’s ability to influence change in the current Fair Trade system and some folks have suggested that they get out of Fair Trade completely and work on a new model, but for now it seems that they are at the forefront of pushing Fair Trade to actually mean something.

I pulled most of my data from Dan Jaffee’s book called ‘brewing justice’ which was published by UC Press.

J-ROD

]]> By: Siel http://greenlagirl.com/minimum-price-for-fair-trade-certified-coffee-goes-up/comment-page-1/#comment-198617 Siel Wed, 09 Jan 2008 23:03:48 +0000 http://greenlagirl.com/2008/01/08/minimum-price-for-fair-trade-certified-coffee-goes-up/#comment-198617 David K. -- You do bring up an important point re: the rising market price of coffee, but I also wanted to note that you're also comparing two different things here. The fair trade min price is the figure that goes to the farmer co-op, where as the $1.39 figure you're referring to is the sum that goes to someone or some company much higher in the supply chain. Outside the fair trade system, the farmer co-op would receive only a portion of that $1.39 once it trickles down. David K. — You do bring up an important point re: the rising market price of coffee, but I also wanted to note that you’re also comparing two different things here. The fair trade min price is the figure that goes to the farmer co-op, where as the $1.39 figure you’re referring to is the sum that goes to someone or some company much higher in the supply chain. Outside the fair trade system, the farmer co-op would receive only a portion of that $1.39 once it trickles down.

]]> By: scott p http://greenlagirl.com/minimum-price-for-fair-trade-certified-coffee-goes-up/comment-page-1/#comment-198536 scott p Wed, 09 Jan 2008 19:29:39 +0000 http://greenlagirl.com/2008/01/08/minimum-price-for-fair-trade-certified-coffee-goes-up/#comment-198536 David, Great question. The minimum is just that - a minimum. We write most if not all of our contracts above the minimum and our worker owned coop business model works with the modest goal of a 2-3% net income. The other key part that the minimum price discussion misses is pre-harvest financing. The pre-financing that we and other committed fair traders like Just Coffee provide is arguably more important than increases in the minimum price as it allows farmers to hold onto more of their coffee to turn into their coop and thereby gain more income and for buyers it means sharing the risk - the true spirit of fair trade. David,

Great question. The minimum is just that – a minimum. We write most if not all of our contracts above the minimum and our worker owned coop business model works with the modest goal of a 2-3% net income. The other key part that the minimum price discussion misses is pre-harvest financing. The pre-financing that we and other committed fair traders like Just Coffee provide is arguably more important than increases in the minimum price as it allows farmers to hold onto more of their coffee to turn into their coop and thereby gain more income and for buyers it means sharing the risk – the true spirit of fair trade.

]]> By: David K http://greenlagirl.com/minimum-price-for-fair-trade-certified-coffee-goes-up/comment-page-1/#comment-198312 David K Wed, 09 Jan 2008 10:40:32 +0000 http://greenlagirl.com/2008/01/08/minimum-price-for-fair-trade-certified-coffee-goes-up/#comment-198312 Another nickle? I just checked the International Coffee Organization website, they say the market price for Colombian arabica is $1.39. So the free trade price is still higher than the fair trade price, even with the increase? Since fair trade coffee sellers sell for a couple bucks more per pound than the rest, why don't they make the price $2.35, send an extra dollar to farmers and still skim a buck off the top for themselves. Another nickle? I just checked the International Coffee Organization website, they say the market price for Colombian arabica is $1.39. So the free trade price is still higher than the fair trade price, even with the increase? Since fair trade coffee sellers sell for a couple bucks more per pound than the rest, why don’t they make the price $2.35, send an extra dollar to farmers and still skim a buck off the top for themselves.

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