A Cup of Justice
Coffee,
Fair Trade, &
Justice for
Farmers
in the
Global South
Many Small Farm Families
Depend on Coffee
Worldwide, 20 to 25 million
small farm households,
some 125
million people,
depend on
coffee for their
livelihoods.
Nicaragua
Costa Rica
Ethiopia
Small coffee farmers
receive 1% or less of the
price of a cup of coffee
sold in a coffee shop.
1%
5%
They receive roughly 5%
of the retail price of a
package of coffee sold in
a U.S. supermarket.
Small coffee farmers,
their families and
communities
are suffering
What Is
Happening in the
Global
Coffee Industry ?
Ethiopian coffee farmer
Prices Paid Coffee Farmers are Very Low
$6.00
per pound (2005$)
$5.24
$4.00
$1.86
$2.00
$0.89
$0.51
$0.00
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The price
farmers
receive for
their coffee
is at a
record low,
just 25% of
the price
in 1960.
World Price of Coffee,* 1976-2005
(adjusted for inflation)
* A djusted fo r inflatio n est. at 3% / year
So urce: Internatio nal Co ffee Organiz.
An excess supply of coffee has
driven down the price
Farmers try to offset
the falling price by
producing and
selling even more.
But this leads to
even lower prices
and earnings
continue to fall.
Small Farmers Earn too Little
Low coffee prices and small
farmers’ vulnerability
and disadvantage
mean they earn
too little for their
coffee.
Developing Countries Earn too Little
Exporters in coffee-producing
(usually poor) countries sell their
coffee to international buyers and
roasters. These large multinational firms seek
to pay as little as possible.
Just three roasters (Nestle, Kraft/
Maxwell House, and Sara Lee)
process 45% of the world’s coffee.
Just four companies
purchase 40% of the
world’s coffee.
The Impact of Low Coffee
Earnings On Coffee Farmers and
their Communities
Chiapas, Mex.
San Cristobal de las Casas, Mex.
Impact of Low Coffee Earnings
Worsening poverty
In Mexico, “as a result of the decline in
farmers’ income, about 20% of children were
taken out of school and
[farmers] were unable to
afford clothes, shoes,
basic medical attention,
and repayment of credit.”
-- Mexico: Coordinadora Nacional de
Organizaciones Cafetaleras
Chiapas, Mex.
Impact of Low Coffee Earnings
Loss of Farms
Farmers can lose their land, forcing families
to move to cities where living conditions may
be inhumane and jobs are scarce.
Indonesia
Brazil
Impact of Low Coffee Earnings
Migration
Farmers may leave their country, seeking
work elsewhere. Tens of thousands of
Mexican coffee farmers have left their land,
leaving behind grieving
families and weakened
communities. Some
come to the U.S.
without documents.
U.S.-Mexico border
What Can Be Done ?
Fair Trade, not “free” trade,
will improve the lives of
coffee farmers
Fair-trade importers provide
a vital link between small
farmers and consumers
who seek justice for small
coffee farmers.
A Fair Trade Coffee Importer
Agrees to:
Buy coffee grown
by small farmers
organized into
cooperatives (coops).
What is a Coop?
A cooperative (coop) is a business
that is owned and democratically
controlled by
its members.
Members, CIRSA Coop, Chiapas, Mex.
What is a Coop?
A coop operates for the benefit of its
members. It does not earn profits for shareholders. It elects its own leadership and does
not
answer
to an
outside
board.
Coffee coop members, Nicaragua
A Fair Trade Coffee Importer
Agrees to:
Pay a fair price currently set at $1.21 a
pound or pay the world price, whichever
is higher; and
Pay a 5 cent per pound
“social premium;” and
If organic, pay an
additional 15 cents a pound.
The Social Premium
The social premium of 5 cents per pound is
paid to the coop, not to farmers.
Coop members decide how this money is to
be used: for example, to
purchase needed
equipment such as a truck
to transport coffee, or to
build a school or clinic.
Truck purchased by Mexican coop
A Fair Trade Coffee Importer
Agrees to:
Purchase coffee directly from farmer
coops, eliminating many “middle men” and
opportunities for
exploitation,
providing higher
prices for farmers.
Warehouse, CIRSA Coop, Chiapas, Mex.
Benefits of Fair Trade
to Farmers and their Families
Better education, health, and opportunities
due to the social premium payment.
Higher incomes.
Greater access to
credit for investment
and other needs.
Benefits of Fair Trade
to Farm Communities
Enhanced community
opportunities such as
economic development projects, schools,
health clinics,
sanitation facilities,
clean water, and
fuel-efficient stoves.
Strengthened communities with less poverty,
more stability, and healthier and more
educated community members.
Fairly Traded Coffee
Certified fair-trade coops
produce seven times more
coffee than fair trade buyers
purchase. They cannot sell
all their coffee to fair trade
purchasers.
So we need to expand sales
of fairly traded coffee.
Fairly Traded Certified Coffee
The nonprofit
organization
TransFair USA
certifies coffee,
tea, chocolate,
rice, sugar
and a few
fresh fruits.
WATCH FOR & BUY PRODUCTS WITH THIS LABEL
Where to Buy Fairly Traded Coffee
There are a number of Fairly
Traded coffee traders and
roasters.
Coffee, tea, and cocoa may
be purchased through the
UCC-Equal Exchange Coffee Project
(www.ucc.org/justice/issues/coffee-project/)
Where to Buy Fairly Traded Coffee
Starbucks, Dunkin' Donuts, Procter & Gamble,
and other large corporations have also agreed
to sell Fairly Traded coffee. However,
consumers report
it is often unavailable
when they request it.
The Bottom Line:
Watch for the Fair
Trade Certified logo
Produced by
Edith Rasell
Minister for Workplace Justice
Justice and Witness Ministries
United Church of Christ
700 Prospect Ave
Cleveland, OH 44115-1100
216-736-3709
raselle@ucc.org
2006
,
God is Still Speaking