The Problem With Fair Trade Coffee

Europe and the US account for about 88 percent of the world’s coffee consumption, while most beans are grown in developing nations. Some industry representatives try to ensure what’s become known as “fair trade,” by certifying producers who meet specific labor, environmental and production standards. “Retailers explain that neither FLO – the Fairtrade Labelling Organization’s International umbrella group – nor Fair Trade USA, the American standards and certification arm of FLO, has sufficient data showing positive economic impact on growers,” writes Colleen Haight for the Stanford Social Innovation Review. “Among the concerns are that the premiums paid by consumers are not going directly to farmers, the quality of Fair Trade coffee is uneven, and the model is technologically outdated.” Some farmers sell lower grades of beans at guaranteed fair-trade prices, reserving higher quality product for specialty buyers willing to pay premium prices. Greater transparency and more information among consumers and producers could eventually ease imbalances. – YaleGlobal