Changes to Fair Trade - Good News About the Coffee Industry!

Hi Everyone,
I found this interesting post on the Stone Creek Coffee Blog and for those of you interested in Fair Trade Coffee (which should be all of you since you're all a part of the Specialty Coffee Industry now!) I thought I'd post a little GOOD news about the coffee industry:

About a month ago an email popped into my inbox announcing some changes to the Fair Trade Certification for coffee. These changes went into effect on April 1 and have addressed several important factors of this certification.
Fair Trade standards are set by Fair Trade International (FLO), a sustainability organization based in Germany. Fair Trade USA is FLO’s certification partner here in the United States. After careful review of the old standards, the following changes have been made:
Pricing and Premiums
For many years, the minimum price paid to a producers for their coffee has been $1.26 per pound for a conventional (non organic) coffee and $1.41 for a certified organic coffee. Since these prices were set, cost of production has increased significantly. To address this, the new price floors will be $1.40 for conventional coffees and $1.70 for organic coffees.


These price floors are meant to provide a safety net for coffee producers when the market price of coffee drops below what is considered to be a sustainable minimum price. Currently, the market price for coffee is more than $2.87 per pound.


In addition to increasing the price floor, FLO has also increased the community development premium for Fair Trade Certified coffees from $0.10 per pound to $0.20 per pound. The community development premium is an allocation that must be set aside for projects that improve the social standards of the community where the coffee comes from. Under the new requirements, $0.20 from the negotiated price must be reserved for these types of investments.


Cooperative Capacity Building
In discussions with producer groups, the staffs of FLO and Fair Trade USA have learned of the continued need for technical assistance and capacity building. Over the past 5 years, more than $2 million has been invested in business capacity initiatives in Africa and Latin America. Based on the success of these programs, Fair Trade USA is in the process of creating a Cooperative Capacity Building Initiative that will enable more of these types of projects to happen. These projects will ultimately improve the quality and yields of coffee worldwide, effectively easing the pressure from the current low global supply.


In a difficult time of low supply and high prices, it is important to take note of the great work happening in the coffee industry.

Have a pleasant Easter Break everyone!