Redefining fair trade coffee

When you buy a pound or a mug of fair trade coffeesignified by its logo depicting yin and yangyou expect that somewhere in Africa, Central America or Indonesia, a small farmer is benefiting from your choice. But can you be sure?

A division over the definition of fair trade has sparked an international disagreement over the requirements of fair trade coffee. Supporters of the change, including two local coffee roasters, Counter Culture Coffee and Carrboro Coffee Company, say the overly rigid standards penalize larger farmslarger meaning 50 or 100 acres, not the 10,000-acre tracts associated with American agribusinessthat are as environmentally and economically sustainable as their smaller counterparts. Opponents say the change dilutes the meaning of “fair trade.”

Fair trade coffee certification offically began in 1988. In general, the original standards were meant to foster a thriving livelihood for small-scale farmers in developing countries. In theory, fair trade cuts out a middle man and provides a floor price of $1.26 per pound, with a 5-cent premium above market prices. Fairtrade International then funnels part of this money into economic development programs for the coffee communities with which it does business.

The standards require that all fair-trade certified small-scale farmers belong to a cooperative. Ideally, fair trade with co-ops ensures small farmers reap larger profits for smaller amounts of beanstoo small for a full business order. (These co-ops typically mix beans from various farms into one cargo container.) Another requirement is that farms rely solely on farm-owner labor and their families, not outside employees.

But in September, Fair Trade USA (FTUSA) split from Fairtrade International and proposed new standards that expand fair trade to include some larger farms and estate plantations. The move has been scrutinized by the Institute of Agriculture and Trade Policy, which founded FTUSA. In an official statement released Dec. 1, IATP wrote: “We are deeply concerned that Fair Trade USA’s unilateral approach will fracture the fair trade movement, and reduce the overall credibility and value of the fair trade ‘brand’ for farmers and consumers.”

However, that may not be the case. Carrboro Coffee and Counter Culture still buy from Fair Trade Certified co-ops. They prefer to work directly with farms, regardless of their co-op membership.

Kim Ionescu, Counter Culture’s coffee buyer and sustainability manager, recognizes the economic and social distinction between co-ops and independent farms. But she says the latter, as described as “large” or “estate” by FTUSA’s new program, are not corporate farms that the classification may suggest.

Ionescu cites Counter Culture’s most consistent client, Finca Mauritania in El Salvador, which is a family-operated, fifth-generation farm. “They’re too large to qualify to participate in a fair trade cooperative because they produced enough coffee to market it to buyers,” she says. “We struggled in how to approach everyone in the same way. It always came up in a consumer’s mind, ‘Does this mean that these coffees aren’t fair?’ No. We have to figure out a way to put these farms and coffees on a level playing field. In the scale of American agriculture, those are not gigantic farms. But they produce enough coffee on a 50-acre farm to produce a container, 275 bags, without combining it with anyone else’s coffee.”

Aida Batlle owns Finca Mauritania, which has been in her family since 1969. For each harvest Batlle hires the same farmers to thoroughly pick the ripest coffee cherries on the 38-acre farm; by using these non-family employees, Finca Mauritania doesn’t meet Fairtrade International’s requirements. But Batlle says she can pay her workers “three times what everybody else is paying, which includes transportation and food. A lot of farms will provide transportation or food, but they’ll deduct it from their wages.” She also says she reinvests in the community, including supporting schools and health clinics.

“Our biggest complaint with fair trade certification when we created direct trade certification was that we couldn’t apply it to Aida’s farm; that there was no way that we could say this is fair too, but just different,” says Ionescu, Batlle’s biggest customer. Counter Culture pays at least $3.60 per pound for coffee from Finca Mauritania because the workers are treated well and the quality of the coffee is high.

“We always felt like the message of fair trade being about co-ops wasn’t something the consumer connected to. Consumers think that fair trade was about minimum wage. That wasn’t really what it represented. It’s also the workers’ ability to organize, working conditions. I think there are some positive things about it. Some disadvantages are the critical reviews of fair trade. It seems like it’s been portrayed as a decision by Fair Trade USA to weaken the standard to cater to larger buyers.”

Miguel Zamora, FTUSA’s director of coffee innovation and producer relations, told the Indy that the organization’s new approach doesn’t change the essentials of fair trade. This new model is already used with other fair-trade agricultural products, such as bananas and tea. “Right now, many roasters buy from larger farms because of the specific quality characteristic, relationships for their products and can’t have all their supply chain Fair Trade Certified (independently of how sustainable the practices of those farms are),” Zamora says. “With the certification opening to more farmers willing to meet the environmental, social, economic and labor standards of Fair Trade, roasters will have more Fair Trade options for their products.”

Zamora meets with farmworkers, he says, “one on one, directly with farmworkers and without the presence of management,” he says. “For the next visit, the conversations actually happen outside the farm, in the workers’ communities.”

Carrboro Coffee and Counter Culture agree that FTUSA has helped consumers distinguish between what is and isn’t ethically traded. However, they say the terms are broad, which prompted them to develop their own standards. Scott Conary, co-founder of Carrboro Coffee, defines his methods as a direct relationship, with a focus on family farms and personal relationships with the farmers. Counter Culture has created its own model and logo, using the term “direct trade” to signify fair price, quality and transparency.

The labels that Counter Culture and Carrboro Coffee use are substantiated by their own research and methodology. For 17 years Conary has worked with small farms in Central America to import high quality coffee while paying the farmers a price that exceeds a living wage. Fairtrade International’s certification system doesn’t specifically define a minimum, fair or living wage, but bases figures on each country’s average.

“I’m not bashing Fair Trade [certification],” Conary says. “It’s done a lot for awareness. I just get worried that people think because the certification exists, that the problems aren’t still there. We go to great risks to do this. It’s about making sure that there’s equity in the economic structure and that people aren’t only getting paid what they deserve, but that it’s disseminated appropriately [within the community].”

Correction (Jan. 6, 2012): Counter Culture pays a fixed minimum price of $1.60 per pound for green coffee (see counterculturecoffee.com/direct-trade-faq). However, the lowest price they paid Finca Mauritania in 2011 was $3.60 per pound (not $1.60 per pound, as the story originally stated). See comments below.