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An Ever-Changing Fair Trade Landscape in North America
01 December 2012

The Fair Trade movement in North America has been entwined in on-going and often heated debate since the beginning of 2012, with the split by Fair Trade USA from the Fairtrade International standards and certification system and the USA office launch of their new marketing banner “Fair Trade for All.”

One of the main driving points of the separation revolves around “FT for All” wanting to change rules and operations to include large scale coffee plantations as well as individual small-scale farmers as Fair Trade.

According to Merling Preza, General Manager of Prodecoop and historical leader in CLAC says FT USA had confirmed their commitment to respect small-scale farmer place in Fair Trade time and again and once more as recently as June 2011. When FT USA announced its split from FLO and the plans to include not only plantations, but also independent (unorganized) small farmers in November 2011, Merling says, “The news hit us like a bucket of cold water.”

 Peru table votes 'yes' for the 2013 slogan "Pequenos Productores Construyendo
 un Mundo Justo y Solidario"(roughly translates to: Small-Producers Building in
 Solidarity a Fair World) during a Caribbean-Latin American producers meeting 
 this year.
                                                                                     Photo: Coop Coffees

On the one hand, Fair Trade for All proponents claim that their initiative will make “fair trade” accessible to more producers and traders. But small-farmer coop leaders and dedicated Fair Traders alike respond that this move has fundamentally distorted and diluted the core essence of what Fair Trade historically has attempted to accomplish as a trading tool to supporting sustainable, community development.

FT for All would like consumers to believe that theirs is a more inclusive and charitable approach. But for anyone who understands what actually happens to small-farmers in coffee-growing countries, the flaws and blemishes of this approach become quickly apparent.

The Example of Coffee

Coffee is the single most important tropical commodity. In economic terms, coffee is second only to crude oil, and is the primary export of many developing countries. According to the International Coffee Organization (ICO), worldwide exports of coffee reached an estimated US$ 15.4 billion in 2009/10 and some 5.6 million tons shipped. With recent increases in international coffee prices, the market annual value of coffee exports is now hovering around US$ 30 billion.

But despite the money in coffee, most coffee producers wear the desperate face of poverty.

  Map of coffee producers.                                                Photo courtesy: Coop Coffees

The coffee industry is dominated by a handful of companies, who set the rules of the game and influence national politics to their benefit. Plan Nestle, is a classic example: the Mexican government subsidizes Nestle giving public funds to incentivize Mexican farmers to re-plant their fields with Robusta coffee… a low-grade, low-price coffee that is good for Nescafe, but which will never fetch premium prices for farmers.

Historically, governments of coffee-producing countries favor economic policies that support large-scale production and traders – but leave small-scale farmers to struggle for market share on a rigged playing field. Left “to compete” without access to adequate credit, inputs or technology, the only hope small-farmers have to succeed is to join together in cooperatives and gain some economies of scale.

And THAT inequality is precisely what Fair Trade set out to address.

Today with the launch of “Fair-Trade-for-All” – placing plantation and small-scale farming operations back into the same basket - we have lost a fundamental differentiation in Fair Trade, with very confusing information presented to consumers and with small-scale farmers struggling to hold onto the hard-won gains they have made over the past decades.

To unravel how we got to this place, we need to look at a history of the FairTrade Labeling Organization (FLO) influenced and often dominated by “growth strategies” that shifted both its thinking and eventually the face and the focus of what Fair Trade intended to accomplish as a values driven enterprise. Take this to its current extreme and you have Fair Trade USA -- now re-baptized “Fair-Trade-for-All” – focused on easier access to Fair Trade products for large companies and the resulting lower standards.

In producer countries we are already seeing the impact, with buyers believing they can get away with pressuring farmer cooperatives to accept lower differentials on contracts. This will have negative impact as well on 100% dedicated Fair Traders – as heavily marketed, yet less expensive product is showing up on the shelf. Meanwhile, many coffee roasters and consumers have no idea what’s happening in the fields or on store shelves.

For us at Cooperative Coffees, these changes will not affect the way we contract. We are committed to upholding highest standards of Fair Trade, because we believe that change will only happen when we empower farmers who have successfully organized themselves in cooperatives to confront the endless challenges they face in their communities. However, this changing landscape will certainly make our jobs a little more difficult!

  Group photo of CoopCoffees roasters and producers during an assembly meeting in Chiapas,
  Mexico in January 2012.                                                              Photo: CoopCoffees

Cooperative Coffees is a cooperative green coffee importer owned by 23 roaster members and specialized in importing high quality, organic coffees. As a member of both Fair Trade Federation and WFTO, of course those purchases are also 100% Fair Trade! We expect to purchase 3.5 million pounds of green coffee in the coming harvest year, or an estimated $11 million in contracts paid directly to small-farmer cooperatives. In the coffee industry that makes us a “small player” – which motivates us all the more to make every gesture count. We strive for maximum, positive impact on the lives of small-scale farmers – whom we consider the true backbone of this industry.

In the meantime, we attempt to create positive and forward-looking impact at every subsequent step along the way. The road to economic justice and sustainable development is simply too long for us to waste time with “one-step forward, two-steps back” strategies!

For more information about our position on Fair Trade, visit:

By Monika Firl
Cooperative Coffees

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