The best coffee in the world grows in a specific climate that can be found in regions near the equator. Unfortunately, many of the countries where this climate exists face economic uncertainties due to governmental issues or other factors.
Second only to oil, coffee is the commodity with the highest volume being exported to the developed world. The high demand for coffee in North America and Europe creates an opportunity for farmers in developing countries to export their coffee. But it also means that is up to us as consumers to be aware of where our coffee comes from.
Fair Trade Coffee Pricing
Many times, farmers join together and form cooperatives in their communities. These cooperatives can sell their product to coffee companies based in North America and Europe. Fair trade coffee companies work directly with farmers to agree on a price that will work for both parties, taking into account factors such as market value and operation expenses. Once a sustainable price is agreed on, the company will pay the farmers a portion of the order cost upfront. This helps the farmers cover their expenses until the order is complete, at which time they receive the remaining balance of their order price.
How Much Money Goes Back to Farmers?
A common misconception is that a portion of the price a customer pays for a fair trade item goes directly to the farmer. But really, the farmer will already have been paid in full by the time the product reaches shelves. The importance of buying fair trade commodities is that customers make it possible for fair trade organizations to continue placing orders from the developing world.
Often, coffee farmers will invest their earned profits in their communities for education, healthcare, the environment, or for improving living and working conditions. In order for these improvements to continue, it’s important that farmers receive consistent orders from distributors. But of course distributors can only buy as much as they can sell. So it’s a cycle that’s largely controlled by consumers’ choice to buy fair trade.
Why Buy Fair Trade Coffee?
Why is fair trade so popular? As people become more aware of problems in the developing world and the issues that arise as a result of unethical trading practices, more people are becoming conscious of where they spend their money. Consumers have the power to make a positive change through their purchasing decisions, because if more people support fair trade coffee brands, companies will be pushed to embrace ethical business practices. By providing fair wages to farmers, prohibiting child labor, and mandating sustainable regulations, fair trade associations promote healthier, happier lifestyles for communities in the developing world.
While the focus of fair trade is to improve the lives of people, the coffee produced under fair trade conditions is often of better quality than standard trade alternatives. This is because corners are not cut at any step of the process. For example, protecting the environment not only protects farmers against harmful chemicals, but it also yields a healthier coffee plant with more flavorful berries. So not only does fair trade coffee support farmers in the developing world, but it tastes great too.
When your company chooses to buy fair trade certified coffee brands, it is choosing to support equality for coffee farmers, sustainable business practices, and environmental responsibility. The purchase of fair trade coffee enables communities to become self-sufficient as they use their earnings to contribute to local education and healthcare.