What Is Free Trade Coffee?

Why fair trade coffee is bad?

Fair trade attracts bad beans. Every crop contains some beans that are of higher quality than others. As the bad beans are drawn into the fair-trade market (what economics calls “adverse selection”), potential buyers eschew buying the coffee for fear of being stuck with the low-quality beans.

What is meant by the term free trade coffee?

Fair trade coffee is coffee that is certified as having been produced to fair trade standards by fair trade organizations, which create trading partnerships that are based on dialogue, transparency and respect, with the goal of achieving greater equity in international trade.

What does it mean if coffee is fair trade?

Farmers who grow fair trade coffee receive a fair price, and their communities and the environment benefit as well. Fair trade certified coffee directly supports a better life for farming families in the developing world through fair prices, community development and environmental stewardship.

Where does free trade coffee come from?

Coffee farmers can get Fair Trade certified by joining member-led co-operatives. Only 360 such co-operatives exist worldwide and most are based in Latin America. In 2011, the U.S. branch of Fairtrade International broke from its parent organization due to philosophical differences.

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Is Fairtrade unfair?

Fair trade is unfair. It offers only a very small number of farmers a higher, fixed price for their goods. These higher prices come at the expense of the great majority of farmers, who – unable to qualify for Fairtrade certification – are left even worse off. Fair trade does not aid economic development.

What are the disadvantages of Fairtrade?

Fair trade is an expensive niche market to maintain, because it needs constant promotion and requires educated consumers. High marketing costs are one reason why all those fair trade premiums don’t make it back to the producers. Retailers may take advantage of consumers’ social conscience.

What is the Fair Trade minimum price for coffee?

The price Fairtrade currently guarantees will be paid to certified coffee cooperatives is US$1.40 per pound, or US$1.70 for organic.

Does Starbucks use fair trade coffee?

Starbucks is one of the largest purchasers of Fairtrade-certified coffee in the world, bringing Fairtrade to coffee lovers across the globe.

Is coffee a Fairtrade product?

Coffee sold through a Fair Trade organization also makes its coffee grower and producers pay a minimum price, higher than the commodity price of coffee. There are several organizations (such as Fairtrade America, Fairtrade International, and Fair Trade Certified) that certify coffee as Fair Trade.

Why should we buy Fairtrade coffee?

When you choose Fairtrade coffee, not only can farmers build a better quality of life for their families and communities, they can invest in growing better quality beans too. Fairtrade coffee farmers invest at least 25 percent of their Fairtrade Premium in improving productivity and quality.

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Why is it important to buy Fairtrade?

The more sales, the more premium to invest in the community, the more produce is protected by the Fairtrade Minimum Price which guarantees the farm will at least get the cost of production in times of global price crash, and more money comes to the co-operative group that can be spent on projects to benefit the wider

Does Fairtrade actually help?

Fair Trade Helps Farmers, But Not Their Hired Workers: The Salt According to a new study of cocoa-producing cooperatives, Fair Trade certification boosts the income of small farmers, but those benefits aren’t shared with their hired workers.

Who controls the coffee trade?

Price Control and World Trade The world coffee market is dominated by four multinational corporations: Kraft General Foods (owner of Maxwell House and other brands), Nestle, Proctor & Gamble (owner of Folgers and other brands) and Sara Lee (owner of Chock Full O’Nuts and Hills Brothers).

Is fair trade coffee more expensive?

But the most important factor is price. Fairtrade is the only global sustainability label that guarantees a minimum price for coffee. Fairtrade certified coffee cooperatives currently earn the Fairtrade Minimum Price of $1.40 per pound – about 40 percent more than the current market price – or $1.70 per pound organic.

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