Fair Trade Coffee Offers a Solution to the Coffee Crisis Essay

Threat of Substitutes: There are various substitutes for fair trade coffee in the industry such as regular coffee, tea etc but not only coffees but in the general beverages market e.g. Coca Cola, Water etc. As a result of this there is a very high threat of substitutes.

Coffee is not just a drink. It’s a global commodity. Multinational coffee companies now dominate the industry worth over $80 billion, making coffee the most valuable trading commodity in the world after oil. While we continue to pay for our lattes and cappuccinos, the price paid to coffee farmers remains so low that many have been forced to abandon their coffee fields. This conundrum is most evident in no place other than Ethiopia, the birthplace of coffee.

2. Most successful companies like Starbucks have started programs to oversee and make sure their farmers are treated well. C.A.F.E.( Starbucks ' program) is Coffee and Farmer Equality this program ensures the farmers safety and the quality if the product. This program has shown to boost productivity between the company and the grower and between the workers and the owners of the plantations. Even though this program is in place the workers are still paid poorly. An expert picket can collect about 6-7 baskets of coffee berries a day, yet they are paid very little. 71% of farms in Brazil are less than 10 lectares, 25% of them are less than 50 lectares and 4% are more than 50 lectares.*

Coffee has played a major role in the lives of many people around the world. “Yet, poetic as its taste may be, coffee’s history is rife with controversy and politics…[becoming a] creator of revolutionary sedition in Arab countries and in Europe” (Pendergrast xvi). After reading Uncommon Grounds, it is apparent that the history of coffee is intertwined with the aspects of the globalization process, the role of Multi-National Corporations, and global economic issues.

In “Free Trade, Fair Trade, and Coffee Farmers in Ethiopia,” written by Daniel Lee and Elizabeth Lee, they discuss the hardships that Ethiopian coffee farmers face. Ethiopia, being one of the poorest countries in the world, depends heavily on their production of coffee. With a population of 78 million, over 15 million participate in the world coffee production. Despite Ethiopian coffee being labeled as one of the best in the world, there is no substantial protection for farmers when the price of coffee

The documentary Black Gold, is about the world coffee market and an Ethiopian fair trade cooperative. Ethiopia being the birthplace of coffee is the largest producer of coffee in the world, producing some of the highest quality of coffee beans in the world, like Harar, Yuban and Sidamo types of coffee. The significant problems pointed out in this documentary show what is wrong in the global trading system. Mainly, while most of us continue have our lattes and specialty coffees, the amount paid to the Ethiopian coffee farmers is so low that a lot of them have been forced to chop down some of their coffee fields and rely on other crops to help them survive. The Ethiopian people are malnourished; they have no clean water, no healthcare, and no schools for their families. As quoted in the film, “They are living hand to mouth”.

I feel as though since the coffee shop is locally owned they will have a solid reputation and have the loyalty of all the locals. Café Campesino currently works with 18 small farmer organizations in 9 distinct, coffee producing countries. Their trading partners are farmer cooperatives, local organizations founded and democratically governed by the farmers themselves. These trading partners include Bolivia, Colombia, Democratic Republic of Congo, Ethiopia, Guatemala, Mexico, Nicaragua, Peru, and Sumatra. There is a high demand for coffee. Statistics show that household ownership of single-cup brewers reached an all-time high of 27% in 2015, that is almost double of what is was in 2014. The younger generations are more likely to go out to purchase coffee than brew it their self. The coffee consumption for ages 18-39 is 45-46%. 34% of those drink at premium places such as Starbucks, Coffee Bean, and would also include Café Campesino, and the total amount of money spent on specialty coffee in the U.S is $18 billion dollars. Most purchased coffee certifications (exclusive purchase, regular, or occasional purchase) are organic at 25%, fair trade at 18%, and rainforest alliance at 16%. Coffee is typically wanted more in the mornings, but is also wanted throughout the day by some. There are many direct competitors such as Starbucks and Coffee Beans which are more specialty coffee shops such as Café Campesino. These coffee shops will have the same premium price as Café Campesino

Perhaps if we open a direct line from the U.S to coffee producing farms, allowing the major companies here to choose which source they get their beans from and who produces them. Coffee is “the second largest world

Mexico is one of the world's largest producers of coffee with over 45 Fair Trade coffee producers, the second largest number of producers in Latin America, which makes it one of the biggest centers of Fair Trade (Kilpatrick 2013, 68). For those in the industrialized north, Fair Trade is a way for consumers to identify where products originate, allowing people to make choices that have positive impacts on the world. For producers living Mexico, Fair Trade not only provides social benefits, but also brings many environmental benefits, as these two aspects are often tied together. Through the examination of both the environmental and social gains, this paper will argue that Fair Trade coffee production in Mexico is having a positive impact on both small scale producers, and on the communities as a

Following Meskela’s journey, the film demonstrates the power held by multinational corporations (MNCs) in setting the price of coffee. He wants a solution, but what happens with commodity traders, the international coffee exchanges, and the World Trade Organization (WTO), he is faced with challenges in finding that. Meskela worked diligently to eliminate the players who tend to come in between the buyers and the sellers. Instead, he went directly to the buyers to ask for a fair price. The fair-trade movement embraced his cause as they work to bring supposedly fairly-traded commodities to grocery stores in America.

Fair Trade Coffee Fair Trade promotes socially and environmentally sustainable techniques and long-term relationships between producers, traders and consumers The world coffee industry is in crisis. A flood of cheap, lower-quality coffee beans have pushed world market prices down to a 30-year low. Many now earn less for their crop than it cost them to grow. Many coffee farmers around the world receive market payments that are lower than the costs of production, forcing them into a cycle of poverty and debtWithout urgent action, 25 million coffee growers' face ruin.

Thus, Starbucks exploits the situation brought about through globalisation, as their "Workers earn two cents a pound for picking berries," says Eric Hahn of the Chicago-based U.S./Guatemala Labor Education Project, whilst ”Starbucks turns around and sells a pound of Guatemalan coffee beans for nine dollars” (Zielinski, 1995). However, Alex Singleton, a fellow at the Adam Smith Institute claimed that 'Starbucks has done more to lift coffee farmers out of poverty than almost anyone else - including Oxfam and the do-gooders,’ (Davis, 2008). Believing that "the answer to development is not large amounts of foreign aid [rather] it’s getting these countries to engage in the global market, and Starbucks helps that’ (Davis, 2008). Certainly, Starbucks has provided work for farmers living in poverty. Although, Starbucks relationship with the farmers was solely developed for the purpose of exploiting and using these farmers and their workers to gain maximum profit by paying $0.57 per pound of coffee sold to the farmers, that’s 2.2 per cent of the $26 per pound it sells for in the United States (Davis, 2008). Thus, not only are Starbucks exploiting the poverty stricken farmers of Guatemala through underpaying them, but they are also forced to work in virtual slave conditions in an unsafe and unsanitary environment. Hence, Starbucks uses the Globalised world to

Many Canadians start their day with a cup of coffee, taking for granted how the coffee bean was grown, harvested, packaged and shipped to their coffee provider to then roast and prepare for us to purchase for as little as $1.50 per cup. Today coffee is the most important product in the Fair Trade market affecting over five hundred thousand producers and workers. The Fair Trade label can be traced back to 1988 originating from a church based Non Governmental Organization (NGO) from the Netherlands that began an initiative to ensure coffee growers and pickers would receive sufficient wages for their work. The NGO created the fair trade label called Max Havelaar. Following this, similar organizations followed

Being a conscious consumer currently is no small task, with multiple choices of mega stores filled with products that our most time often than not filled with products that are cheaply produced. Moreover, the big company’s give little regard to the producer. This is where the concept of fair trade comes from. In a piece of Harvard’s Journal of Economic Perspectives states that “Fair Trade is a labeling initiative aimed at improving the lives of the poor in developing countries by offering better terms to producers and helping them to organize.” (Dragusanu, Giovannucci, Nunn, 2014) The article continues to say that “…Fair Trade-certified coffee exports were 1.8 percent of global coffee exports in 2009…” (Dragusanu, Giovannucci, Nunn, 2014) A reason why this percent maybe so small could be due to peoples who make the argument that Fair Trade is not economically sustainable. This meaning that if these producers are underneath the

According to the Cambridge Dictionary (2014), fairtrade is ‘ a way of selling or buying a product that makes certain that the people who produce the goods receive a fair trade’. Coffee producers’ products are not necessarily produced to organic standards (Global fairtrade, 2010). Nowadays, coffee is one of the most popular beverages in the world. Eighty-percent of the coffee products in the world market are made by twenty-five million small holders (fairtrade, 2012). Around one hundred and twenty five million people worldwide depend on coffee for their livelihood. There are seven million and nine hundred thousand tonnes of coffee produced per year and six million and two hundred thousand of these are for import (fairtrade, 2014).