While enjoying a fantastic cup of coffee courtesy of the Kuranda Coffee Republic up near Cairns, I remembered that I wanted to write something about the various “socially responsible” trade organisations, specifically those that have a strong association to the coffee trade. Of late, there are two main socially responsible trade systems vying for your conscience and your dollar: Fair Trade and Rainforest Alliance.
Fair Trade is really a movement consisting of a number of principal organisations: Fairtrade Labelling Organizations International (FLO), World Fair Trade Organization, Network of European Worldshops and European Fair Trade Association. While Fair Trade refers to the overall movement, Fairtrade refers to the certification given by FLO. In the rest of this article, I refer to Fairtrade, because when you’re in the supermarket shopping for coffee, that’s the label you will see. One of the defining features of Fairtrade is that it guarantees the coffee grower (or whatever the product happens to be; we’ll just be dealing with coffee in this article) a predetermined minimum price for his/her coffee.
You can look at Fairtrade as being just like free trade, except that the coffee being sold has been sprinkled with a range of “socially responsible enhancements”. As mentioned, chief among these enhancements is the knowledge that the farmer who grows the coffee beans that end up in your mug gets at least an agreed minimum price for the coffee, and his/her farm workers are similarly guaranteed a minimum wage. The idea is that the consumer is paying a premium for a superior product, because the coffee has been produced in a way that yields greater benefits for the farmers who grow the coffee. So, in this respect, the price of Fairtrade coffee is set by supply and demand, just like non Fairtrade coffee. There is an ethical dilemma here, however. An important criticism of Fairtrade, and one that I believe is completely valid, is that Fairtrade artificially inflates the price of coffee, encouraging more people to grow coffee, thereby increasing supply and, in the long run, placing downward pressure on coffee prices (non-Fairtrade coffee). This, of course, results in farmers receiving less and less for the coffee they grow. The ethical dilemma is that Fairtrade coffee is marketed as being socially responsible and fair, but the question must be asked “fair to whom?” Certainly not to the farmer who sees the price of his coffee going down because all his mates have decided to try to get a piece of the action. The already oversupplied coffee market becomes even further oversupplied. Consumers with a social conscience, I believe, ought to think twice about Fairtrade – it might not be as fair or as socially responsible as you think. Besides, I wonder just how many consumers of Fairtrade coffee take the time to find out what this minimum wage is, and what this minimum wage could buy in the given farmer’s country.
Rainforest Alliance has different goals to that of Fairtrade. Its mission is to
…conserve biodiversity and ensure sustainable livelihoods by transforming land-use practices, business practices and consumer behavior.
Rainforest Alliance certification means that goods (coffee in our case) are produced in an environmentally sustainable fashion, in adherence to the Sustainable Agriculture Network standards. These standards set down criteria relating to water pollution, erosion, environmental and human health, wildlife habitat protection, waste, water efficiency, farm management and working conditions. An important distinction from Fairtrade is that there is no artificial minimum price set for the product. As such, there is no artificial incentive introduced for more farmers to produce coffee, and therefore no distortion of production levels and prices. For these reasons, I’d be more comfortable buying Rainforest Alliance Certified coffee than Fairtrade Certified coffee. Rainforest Alliance certification is gaining momentum, with some big corporations, no doubt trying to improve their image, serving up or packaging up Rainforest Alliance Certified coffee. These include McDonald’s and Kraft.
Of course, there are other kinds of certification as well, including UTZ and various organic certifications. There’s also direct trade, whereby a coffee roaster or boutique coffee shop establishes a relationship directly with a coffee grower. This allows the buyer to select a grower who meets their own set of ethical criteria. Because the buyer knows first hand how the coffee is produced, there is no formal certification required. See the Cooperative Coffees site for a good explanation of the most common kinds of certifications.
Meanwhile, back at the Kuranda Coffee Republic, Mike just serves cups of great coffee, which are each
works of art and feats of engineering, with an ample helping of banter. His differentiation is that he sells only direct to people, spurning lucrative approaches by corporations. I guess you could call this extreme direct trade, so his coffee requires no further certification. It’s not about capitalism or not capitalism, he claims. It’s that he wants all of the beans he grows to be served with a “Hello, how’s it going” and a “Thanks for coming.” Sell to corporations, he argues, and you can’t be guaranteed that the shop assistant or barista will respect the beans and the experience. And here’s a tip: engage Mike in good conversation, say thanks for your coffee, and for your next cup he might just give you the discount he reserves for locals. Even at the standard price of $3 for a large cup, you’ll be hard pressed to find a better value coffee anywhere in Far North Queensland, or all of Queensland for that matter. Will I be going back to the Kuranda Coffee Republic next time I’m in Cairns? You bet.