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Fair trade, fairly traded

Written by Sherwin, published on April 3, 2010

Fairtrade certification

I drink a lot of coffee. And sometimes I like to have a well made coffee. And sometimes I’ll drink any ole’ gas station coffee. But generally speaking, it matters to me if coffee is grown organically. Even more so, it matters to me if coffee is certified as Fair Trade coffee.

And it’s not just me. Fair Trade is an important part of coffee culture in Victoria, and beyond. Of course, there are many people who don’t care about these things. There are even those that think that the price controls of Fair Trade coffee is a ruthless attack on market capitalism.

But the vast majority of people that think about Fair Trade coffee, think it’s cool. On my view, you have to understand the coffee trade in the context of four hundred years of colonization to really see why it’s so important. Coffee grown in South America, for example, is grown as a cash crop by regions that have suffered centuries of invasion, debt incurred by corrupt regimes imposed by colonial interests, civil war caused by the resultant political instability, disease, genocide, religious persecution, and human rights atrocities that still continue to this day. So desperate communities will grow coffee beans at great social and environmental cost and sell them for very little. Four centuries of colonial abuse has taken away the ability of many communities to negotiate a better price.

Years ago, some clever do-gooders thought they might be able to help some coffee growing communities to negotiate a better price for their coffee.1 These do-gooders wanted to get a price for these communities that allowed them to save and build and to do more than live in abject poverty. They reasoned that if some coffee buyers shared the same values they did, that they would pay a little more so that others could live a better life. But how would customers know whether they could trust that the extra money was actually going to the farmers?

The solution was to create an arm’s length third party to assess and approve trade scenarios to certify that communities were actually getting a fair price. Now the term, “fair price,” is an interesting one. Free market purists will scoff at the term, arguing that a price is set by demand and supply and the willingness of individuals to pay. Free market purists will argue that there is no such thing as a “fair price.” But pretty much every other sane human will agree intuitively about the fairness of pricing, and this is all that counted.

So here we are in Victoria, years later, and there are many coffee shops that will serve only certified Fair Trade coffee. The certifications come from Transfair or, I think, a variety of twenty other international certifying bodies. And most coffee drinkers have heard of fair trade coffee. And this idea, “fair trade,” has become a valuable part of the brand of any company doing business in coffee.

And here’s where it gets interesting. It gets interesting because every coffee shop wants to be thought of as community oriented, and socially responsible and a good global citizen.

Starbucks, for example, will take out one page ads in the Globe and Mail telling readers about the way they serve Fair Trade coffee. And when I find myself at a Starbuck’s and the barista asks me whether I want dark or medium, I say, “oh, just give me the Fair Trade one.” The barista will inevitably say that they’re both Fair Trade. Now, inwardly, I’m smiling when this happens. Because I know that Starbucks only brews certified Fair Trade coffee one day a month.2 So then I say ask them to show me the label and what certifying body says its actually Fair Trade. And the poor embarrassed, and someone surprised, barista has to admit that it’s just Starbucks that says it’s fairly traded.

And that’s the difference between certified Fair Trade and fair trade or fairly traded. See, any free market capitalist can say the price they pay to cash crop exporters is fair. Anyone can say they serve fairly traded coffee. Yup, we bought this stuff from a family who couldn’t make the mortgage payments and were going bankrupt from medical costs and whose child was born deformed from the pesticides and fertilizers they are required to use, in order to pay the militia that was trained by the CIA – but don’t worry, we payed them a fair price.

This is why the third body certification process is so important. This is why I ask the barista to look for the TransFair logo. See Starbucks may very well pay all of their suppliers a good price. But unless they get certified, I don’t trust it. And I think they’re creating an illusion when their ad has the TransFair logo on it because they brew the certified Fair Trade coffee one day a month. This is pretty effective branding because most consumers don’t pay enough attention to see through this. This is also effective internal branding, since most of their employees even believe that all of their coffee is FairTrade. It’s a very convenient omission.

Now, in their defense, it’s not just Starbucks that does this. Actually that’s not a defense. But it is a dispersal of guilt. Well whatever. The point is that lots of coffee shops serve fairly traded coffee. When pressed on this issue, many coffee shops train their employees to say that they don’t serve certified Fair Trade coffee in order to pay the farmer more. The reasoning goes like this: since the certification body has infrastructure costs to pay, the certification process is more expensive, and that cost takes money away from the farmer.

I think this is unfortunate. I think it’s a fancy way to undermine people’s confidence in the certification process, while getting the benefits of the brand value that the very same certification process created. It sounds to me like the very same argument put forward by companies that claim governments shouldn’t regulate, because it costs the consumer.

  1. More than just a fair price, there are several criteria for Fair Trade including directness of trade and others. You read more here.
  2. I should add that even serving Fair Trade coffee one day a month is better than nothing. And because Starbucks is so large, this amounts to a lot of coffee. So at least this much is good.
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Archived comments

  1. […]  Sherwin’s recent blog about coffee is a great primer for this coffee dialogue. I encourage all caffeine addicts out there to read it. […]

  2. sherwin says:

    Yeah, it’s tricky because some coffee shops do have fairly traded coffee that actually is fairly traded, it’s just not certified by an independent third party. So it becomes a trust issue. I was at the Black Stilt on the weekend and they don’t have certified Fair Trade coffee. But the barista claimed that the owner goes on vacation from where he buys the coffee from to make sure he’s giving a fair price. Is it fairly traded? I don’t know.

  3. tim irvin says:

    Excellent and important dialogue here. Thank you for providing some clarity. Companies have confused the fair trade idea with their own clever marketing schemes. I will pass this on to my Dad and others.