Some Thoughts on the Issue of Fair Trade for Coffee

While perusing the net today I decided to read up a little on the issue of fair trade for coffee growers. These coffee growers eke out a miserable existence producing coffee under market conditions that are far from easy. Recently coffee prices have fallen throughout the world, mainly because of over-production. The result is that many Third World farmers have to sell their land in an effort to maintain their standard of living, a standard that for most of them amounts to little more than a dollar or two a day.

What fair trade proponents advocate is the guarantee of a minimum price per unit of coffee, so that farmers can be assured of a yearly income that will help them break out of the cycle of endless poverty.

Although the intention behind the fair trade proposal is laudable, not everyone agrees that the idea will work. Some economists argue that fair trade proposals will only distort market forces by creating excess supply and reducing demand for coffee. This is a very real problem. If arable land is being used to produce inordinate amounts of coffee, what happens to other goods that could also be produced on that land, goods that could also provide the farmer and his family a living (and actually be put to use) if they were grown on the land?

It seems to me that while fair trade policies may be useful in the short run, they can do little to solve the longer-term problems of scarcity and plenty that rule economic conditions and set prices throughout the world. If it were up to me, I would look for ways farmers could become self sufficient by using their land to provide as many of their own goods as possible without having to resort to paying much-needed cash for those goods. Farmers could then sell whatever excess produce they have grown for extra cash.

This idea may sound simplistic, but it is the traditional way small-scale farmers have existed for centuries. And it might serve as a starting-off point for further investigation into the problem of integrating farmers like these into the world market.