2 billion cups of coffee are drunk each day in the world. There is a major crisis however that needs to be dealt with. Coffee farmers end up making pennies on coffee that is sold for more than ten times its purchase price in the US and the rest of the western world. The price paid to coffee farmers is now at a 30 year low, but the prices are set in New York on the commodity market without much of a thought of the farmers.
Black Gold, a new documentary that is airing on PBS, uncovers the lack of fair coffee trade and the truth behind one of the world’s most traded commodities, second to oil. The film focuses on Ethiopia, the birthplace of coffee, where farmers voices are only heard by local co-operatives who fight for fair export prices. The Etheopian community’s economy is based solely on coffee production, nothing else. This is why it is so important that we buy fair trade coffee. I went right on over to Trader Joe’s and bought Ethiopian Fair Trade Coffee. It’s not only excellent coffee, it’s making a difference for the farmers who provide one of the most important products to the world.
>> And a note: Starbucks sells Fair Trade Certified Café Estima coffee but only has whole bean.
“The Ethiopian government has asked Starbucks to sign a licensing agreement that would allow the country to get legal control of the names of its coffees, thus setting an export price that would guarantee better wages for coffee farmers. Control of coffee name brands could increase Ethiopia’s export income by more than 88 million dollars each year. While Starbucks consumers might pay 20 dollars a pound for Ethiopian coffees, the farmers only earn less than ten percent of the retail value.”
View a preview and find air times at PBS.org.
3 Comments
18 Apr 2007 at 22:08
I’m thrilled that you used the correct past participle for the verb “drink” — that’s the kind of thing that makes me giddy!
23 Apr 2007 at 11:27
Ethiopia is pursuing a novel proposal created by Lightyears IP (http://www.lightyearsip.net/ethiopiacoffee.shtml ) in which the government of Ethiopia would trademark geographic names. These being the Sidamo, Harar, and Yirgacheffe coffee growing regions. After doing so, the government of Ethiopia would set up a global network of licensed distributors. The licensed distributors working with the government would then help determine the retail price of Ethiopian coffee and direct some portion of their proceeds to advertise and market the superiority of Ethiopian coffee versus say Colombian coffee. The goal of all of this being higher prices for coffee and happier, healthier coffee farmers.
I believe this novel approach, which is strongly supported by OxFam, is unworkable and that it will have the unintended consequence of harming the Ethiopian coffee industry, reducing demand for Ethiopian coffee, and thus hurt already poor coffee farmers and their families. The road to hell is paved with good intentions.
Geographic names are not trademarked. In fact it is not typically even possible to do so. We squeeze Florida oranges not Florida™ oranges and drink Burgundy not Burgundy™. NYC Mayor Bloomberg should move quickly to trademark “Brooklyn” to prevent Domino’s from further disparaging its fine history with their horrid new pizza. But, he won’t because the idea is absurd. Alas, the whole world is free to make New York cheesecake.
The government of Ethiopia has not succeeded at providing running water in more than 50% of its villages nor at paving many roads nor at much of anything actually. The country is a basket case, a disaster. It is laughable to suggest that this government is now ready to take on the task of setting up and managing a worldwide network of anything. In any event, it has more pressing issues that it should be focused on.
The government of Ethiopia is good at buying weapons including tanks and fighter jets.
http://en.wikipedia.org/wiki/Military_of_Ethiopia
It is also good at jailing, torturing and killing its opponents. It is corrupt and perhaps very, very corrupt.
http://www.amnestyusa.org/countries/ethiopia/document.do?id=ENGUSA20061116001
http://news.independent.co.uk/world/africa/article2251351.ece
http://en.wikipedia.org/wiki/Ethiopian_police_massacre
This corrupt government will now be managing coffee export and distribution. It is not hard to imagine that some of these coffee earnings could then be converted into more tanks, bullets, and bombs. Given the long history of corruption and theft in Ethiopia and most of Africa (see Nigeria), it is much harder to imagine any of the additional coffee earnings actually making their way to poor farmers. It would be extremely naïve to believe this.
OxFam and LightyearsIP must have this all figured out? Well, call me a pessimist but I don’t see a bunch of well armed military guys taking orders from some grad students at OxFam, 5,000 miles away. Does OxFam have a Mig or tanks?
The Lightyears/Oxfam scheme also injects another layer of cost and overhead into Ethiopia’s coffee sales. Costs that will need to be recouped before farmers even have the potential to benefit.
From a coffee buyer’s perspective, the plan makes Ethiopian coffee more difficult to purchase and sell than other coffees. Buyers are asked to sign a lengthy, onerous trademark licensing agreement. This makes buying other coffee easier and more attractive. This places Ethiopia at a disadvantage in the marketplace which is likely to lead to lower demand and lower prices. Not a good outcome for farmers.
Instead of the complex, unworkable and potentially lethal Oxfam/Lightyears scheme, I think Ethiopia should follow the tested and traditional approach of geographic certification. Florida oranges, Burgundy wines, Napa Valley wines, and Colombian coffee all have producers’ co-operatives that insure these products actually are grown and produced in their stated geographies. The co-operatives then pool some of their resources to promote their products to try and increase demand and thus prices. Juan Valdez, the Colombian coffee dude, and his burro are the creation of one of these co-operatives. Oxfam is essentially saying that all of these large, well established, proven co-operatives are wrong. I say their sales and the demand for these products prove they are right. The livelihood of Ethiopian farmers will hang on the outcome of this bet.
Creating new customers for Ethiopian coffee rather than attacking existing customers is likely to generate incremental demand and higher prices. Neither McDonald’s, Proctor and Gamble, Dunkin Donuts nor Kraft purchase any coffee from Ethiopia. They could. However, if you are the CEO of McDonald’s and you see the no win situation that Starbucks now has with Ethiopia are you really going to want to leap into the fray? This dispute is repelling demand. That is not good for farmers.
But hey Bush and Cheney are lovin’ it. OxFam is promoting a scheme that will in effect funnel money to a Bush ally in the horn of Africa with the funds coming from well intentioned liberal do-gooders while simultaneously attacking one of the most liberal companies in America and harming a major contributor to the Democrats.
http://largehamster.blogspot.com
Note that Starbucks is the world’s largest buyer of Fair Trade Coffee. It is also buys under the C.A.F.E. certification program. Fair Trade coffee prices include 9-10cents a pound that goes back to the Fair Trade organization rather than farmers. CAFE, which is more focused on sustainability and is an option for large coffee growers, does not have this feature.
The price paid by Starbucks for Ethiopian coffee in 2006 exceeded the $1.41 Fair trade price in 2006 (this is gross so farmers would see just $1.31 to $1.32).
14 May 2007 at 12:42
For those of you who are interested in the issue of Fair trade, there is a powerful documentary out called “Black Gold,” that documents the lives of Ethiopian coffee farmers and clearly demonstrates why all of us should be asking for Fair Trade coffee. The film was recently released in the theater but is now available to the public on DVD via California Newsreel. You can read more about the documentary or pick up a copy of it here at http://newsreel.org/
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