How Fair Trade is Transforming the Coffee Industry
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By Community Contributor
February 24, 2016
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Coffee is one of the top commodities in the entire world, and has been near the top of the food chain in terms of international trade for over a century. Because of coffee's rapidly growing popularity in the 19th and early 20th centuries, coffee was an enormous cash crop during the colonial era. As a result the coffee market grew up in an extremely competitive environment.
The Old Coffee Industry
Today we're privileged to finally witness the decline of "Big Coffee". Today's major coffee exporters can trace their roots back to the oppressive plantation-style systems of british colonialism, and modern coffee production hasn't greatly diverged from that model in more than a superficial way.
Coffee growers all over the world, even those growing world famous beans like Jamaican Blue Mountain Coffee, were forced to sell to the same few enormous coffee exporters at ludicrously low prices (30 - 50 cents per pound). In the case of Blue Mountain Coffee, this would be less than 5% of the price that the end user pays for the same coffee.
The Beginning of Change
The rise of the fair trade movement alongside organic foods has put immense pressure on this antiquated and exploitative system. Fair trade is designed to directly combat this exact issue, while organic coffee roasters simply need to be able to communicate directly with coffee growers to ensure the quality of their product.
In both cases, big coffee companies are today simply being bypassed. More conscientious consumers are driving demand for more conscientious business practices, and they're willing to pay the price for it.
What About Price?
Cheap coffee will probably always have a market with people who just don't care, or businesses that want to pay as little as possible for the free coffee in their break rooms. However, it might not always have a supply. As more businesses reach out directly to coffee growers, and as improving technology makes it easier and more practical for growers to communicate across the globe, growers are likely to adopt higher quality farming practices in order to attract better-paying customers.
To stay in business, big coffee companies might, in the next few years, find themselves forced to follow the lead of smaller roasters.
The Old Coffee Industry
Today we're privileged to finally witness the decline of "Big Coffee". Today's major coffee exporters can trace their roots back to the oppressive plantation-style systems of british colonialism, and modern coffee production hasn't greatly diverged from that model in more than a superficial way.
Coffee growers all over the world, even those growing world famous beans like Jamaican Blue Mountain Coffee, were forced to sell to the same few enormous coffee exporters at ludicrously low prices (30 - 50 cents per pound). In the case of Blue Mountain Coffee, this would be less than 5% of the price that the end user pays for the same coffee.
The Beginning of Change
The rise of the fair trade movement alongside organic foods has put immense pressure on this antiquated and exploitative system. Fair trade is designed to directly combat this exact issue, while organic coffee roasters simply need to be able to communicate directly with coffee growers to ensure the quality of their product.
In both cases, big coffee companies are today simply being bypassed. More conscientious consumers are driving demand for more conscientious business practices, and they're willing to pay the price for it.
What About Price?
Cheap coffee will probably always have a market with people who just don't care, or businesses that want to pay as little as possible for the free coffee in their break rooms. However, it might not always have a supply. As more businesses reach out directly to coffee growers, and as improving technology makes it easier and more practical for growers to communicate across the globe, growers are likely to adopt higher quality farming practices in order to attract better-paying customers.
To stay in business, big coffee companies might, in the next few years, find themselves forced to follow the lead of smaller roasters.
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