More on the Issue of Fair Trade Coffee

We use the term "fair trade coffee" quite often, but it might be a good idea to explore the idea in more depth. The following discussion is intended to do just that.

The international criteria for fair trade coffee consists of the following:

First, producer cooperatives are guaranteed a fair price: five cents above the prevailing market price for regular coffee or 15 cents above the market price for organically-grown coffee.

Cooperatives are those organizations made up of certified producers(not middlemen) that are controlled democratically by their members.

Importers must purchase their coffee directly from certified producers and agree to enter into long-term and stable relationships with them.

Such importers must also agree to provide upon request pre-harvest financing or credit to the producers.

Producers must also agree to implement environmental protection plans and are encouraged to adopt organic farming methods.

As of this writing, the fair trade movement is being threatened by an over-supply of coffee on the market. In 2001, the world supply of coffee was 115 million bags of coffee, while the demand was only 105 million. Of that, the amount of coffee that can be considered fair trade coffee is only about 0.05 per cent, a tiny fraction of the total amount of coffee available. In addition, most fair trade cooperatives sell most of their coffee at international market prices. There is in fact an over-supply of fair trade coffee of around 100 million pounds per year. In other words, international economic pressures continue to dominate more ethical considerations.